HomeMy WebLinkAbout2022-07-21; Windsor Pointe Update (District 1); Barberio, GaryTo the members of the:
CITY COUNCIL
Date 7 /'l.l /22.cA _i_ cc L
CM _j/_ ACM i/ DCM (3) V'
July 21, 2022
·Council Memorandum
To: Honorable Mayor Hall and Members of the City Council
From: Gary Barberio, Deputy City Manager, Community Services
Mandy Mills, Director of Housing & Homeless Services
Via: Geoff P�tnoe, Assistant City Manager @
Re: Windsor Pointe Update (District 1)
{cityof Carlsbad
Memo ID #2022082
This memorandum provides an update on the status of the Windsor Pointe affordable housing
project.
Background
In 2017 the City Council approved a financing package for the Windsor Pointe affordable
housing project (Attachment 1). The project, developed by Affirmed Housing, was initially
intended to be a permanent supportive housing project for homeless veterans and low-income
veteran families. The project consists of 48 units located on two non-contiguous sites in the
Barrio neighborhood, at 965 Oak Avenue and 3606 Harding Street.
Discussion
After obtaining the initial funding from the city, the developer made two unsuccessful attempts
to obtain Veterans Housing and Homelessness Prevention funding to finance the pr�ject.
Subsequently, the developer applied for and was awarded No Place Like Home funds. This state
funding source uses money collected under the state's Mental Health Services Act to develop
permanent supportive housing for people who are in need of mental health services and are
experiencing homelessness, chronic homelessness, or who are at risk of chronic homelessness.
The No Place Like Home funding changed the categories of people to be offered housing and
supportive services at Windsor Pointe. The change to No Place Like Home funding was reported
to the City Council in a staff report and presentation on Jan. 28, 2020, when the City Council
awarded the project additional funding (Attachment 2). The 2020 updated staff report and
resolution specify the changes to the project. At that time, the issue of a local preference and
the associated legal concerns were addressed. The City Council's approval of the additional city
funding included a provision that required a local preference be given to Carlsbad residents
and/or households with someone who works in Carlsbad to the extent consistent with
applicable law.
Community Services Branch
Housing & Homeless Services Department
1200 Carlsbad Village Drive I Carlsbad, CA 92008 I 442-339-2810 t
Council Memo -Windsor Pointe Update (District 1)
July 21, 2022
Page 2
Tenant Selection
The project had tenants move in during April and May. The selection of tenants for 24 of the 48
units at Windsor Pointe prioritize eligible veterans and/or local affiliation. Carlsbad residents
and veterans do receive priority order on the waiting list for these 24 units. This is a preference
and gives priority order for tenant selection, but there is no specific requirement that each
occupant is a veteran and/or from Carlsbad.
A summary of the current tenant demographics of these 24 units is as follows:
• Total veterans: 12 (3 Carlsbad veterans and 9 other veterans)
• Carlsbad residents: 6 (the 3 Carlsbad veterans previously noted and 3 other Carlsbad
residents)
• Other residents: 9
There were 11 additional veterans who applied to the waitlist, but either canceled their
application or were denied for various reasons.
Tenant selection for the other 24 units is based on the requirements of the No Place Like Home
funding. San Diego County identifies applicants with a severe mental illness diagnosis and who
are awaiting permanent housing. This is done through a Coordinated Entry System (CES) that is
administered by the Regional Task Force on Homelessness acting as the Continuum of Care for
the region. Coordinated entry processes are intended to help prioritize people who are most in
need of assistance. Because this project received State funds and requires the use of CES for
tenant selction, the units covered by the No Place Like Home guidelines cannot be prioritized
for local community members. Although the city owns the land and invested local funding
towards project development, there is no ability to give people experiencing homelessness in
Carlsbad a preference. Since January, 2022, city staff have raised concerns regarding this issue
to staff and the Advisory Board of the Regional Task Force on Homelessness. Mayor Hall raised
the concerns again at the Intergovernmental Roundtable on May 9, 2022. At the end of that
meeting Tamera Kohler, Chief Executive Officer of the Regional Task Force on Homelessness,
committed to working with cities at a policy level to address this issue. There is no additional
updated information on the CES issue at this time.
Security
A neighboring resident sent correspondence noting that a Registered Sex Offender individual
had listed the Harding Street address as his place of residence on the Megan's Law registry
website. The property management firm confirmed the individual is not, nor has he ever been,
an authorized resident of the complex. The fact that he listed the Harding Street address allowed
property management to pursue legal action against that individual. The address has been
removed from the registry list and property management will monitor any attempt by this
individual to occupy a unit at the property.
Council Memo -Windsor Pointe Update (District 1)
July 21, 2022
Page 3
A criminal background check is conducted for each applicant. To ensure compliance with
housing laws, the property management company uses a third-party vendor to perform tenant
background screening. A number of criminal background findings preclude occupancy. For
example, sex-related felony convictions would trigger a denial. In compliance with fair housing
laws, individuals with sex-related felony convictions within fifteen years would be allowed to
file an appeal and receive an individualized assessment of their background to be considered.
Lifetime registered sex offenders are not eligible for residency and will not receive an
assessment.
The safety of the community is very important to the city. The property management company
reports that both buildings have trained professional staff on-site during weekdays, and a
private security guard who patrols the buildings after hours, from 4 p.m. - 2 a.m., seven days a
week. Each building has a Property Manager living full-time on the premises, and security
camera systems are live monitored off site after hours.
Next Steps
City staff are working closely with the project owner and property management company so
that this project can provide a safe, quality living environment for the residents and
surrounding community. City staff will continue to raise the concern about the inability to give a
local preference through the Coordinated Entry System, and will report back to the City Council
if there is any new information.
Attachments: A. Feb. 14, 2017 City Council Staff Report
B. Jan. 28, 2020 City Council Staff Report
cc: Scott Chadwick, City Manager
Celia Brewer, City Attorney
Cindie McMahon, Assistant City Attorney
Mickey Williams, Chief of Police
Laura Rocha, Deputy City Manager, Administrative Services
Attachment A
CA Review 3 ;(
0 CI T Y COU N CI L
Staff Report
Meeting Date:
To:
i=rorn:
Staff Contact:
Subject:
February 14, 2017
Mayor and City Council c/
Kevin Crawford, City Manage~
Debbie Fountain, Housing & Neighborhood Services Director
Debbie.fountain@carlsbadca.gov or 760-434-2935
Resolution to provide $4,250,000 in financial assistance to Affirmed
Housing for construction of fifty affordable apartment homes restricted
for homeless veterans and lower income veteran families, including
homeless veterans.
Recommended Action
Adopt a Resolution to provide a residual receipts loan in the amount of $4,250,000 from the
Carlsbad Housing Trust Fund to Affirmed Housing to assist with the financing of construction of
fifty (50) affordable apartment homes for homeless veterans and lower income veterans and
their families on noncontiguous sites in the northwest quadrant of the City of Carlsbad.
Executive Summary
Affirmed Housing has submitted a request for $4,250,000 ($85,000/home) to the City of Carlsbad
for financial assistance for the construction of 50 apartment homes for very low and extremely
low income homeless veterans and veteran families within the City of Carlsbad. The developer
intends to request funding from the Veterans Administration and the Tax Credit Program as well
to finance the proposed development, which has an estimated total cost of $21.4 million. On July
14, 2016, the Housing Commission reviewed the financial request and recommended approval
to the City Council; the recommendation remained pending until the development received its
approvals. The development has received its approval from the Planning Commission, and the
financial assistance request is now being presented to the City Council for consideration.
Discussion
On January 18, 2017, the Planning Commission unanimously approved a 50-unit affordable
apartment development that will consist of development on two noncontiguous properties (3606
Harding Street and 965 Oak Avenue) within the historic Barrio Carlsbad neighborhood in the
Northwest Quadrant. The Harding Street development will consist of 26 studio, 1, 2 & 3 bedroom
rental homes. These rental apartment homes will be· available to veteran households at very low
and extremely low incomes. A portion of the homes will provide permanent supportive housing
for homeless veterans. The Oak Street development will consist of 24 studio, 1 & 2 bedroom
rental homes. These rental homes will be available to veteran households at very low and
extremely low incomes as well. Similar to the Harding Street development, a portion of the
homes will provide permanent supportive housing for homeless veterans.
All of the residents will have access to dedicated on-site services, including services intended to
improve housing retention, health, education and employment/career opportunities. A
dedicated case manager will work with the veterans on an individual case plan, offer assistance
in applying for benefits, and provide linkages to other community services. Affirmed Housing
(developer) has partnered with Interfaith Community Services to be the service provider.
Affirmed Housing (developer) will develop, own, and operate the veteran affordable housing
development. Affirmed Housing is experienced and has recognized expertise in developing high-
quality-affordable apartment communities within San Diego County. Affirmed Housing also
developed the Cassia Heights Apartments in Carlsbad, and owns and operates affordable housing
developments in other areas of San Diego and Los Angeles counties. Affirmed Housing has a
history of building top quality housing developments, and operating/managing them in an
outstanding manner. The developer has also developed, owns and manages other affordable
homes for special needs populations, such as homeless and lower income veterans.
In considering any financial assistance request for an affordable housing development, staff and
the Housing Commission reviewed several factors. The analysis of the developer request is noted
below.
Cost Reasonableness
Affirmed Housing provided a development proforma for review by staff and the Housing
Commission (Exhibit 2). Since development costs are one of the key variables determining the
need for subsidies, it is important that those costs be reasonable. At approximately $21.4 million
total development costs (including land), the average unit development cost of approximately
$428,000 is, in fact, high as compared to other city-assisted developments but reasonable when
consideration is given to the continuing high cost of land in Carlsbad, especially land in the
Northwest Quadrant of the city, and current costs of construction and related improvements.
This project is also being developed outside of a Master Plan and is not being developed to satisfy
the inclusionary housing requirements for any other housing development. This development, as
currently designed, is intended to be constructed specifically to provide affordable housing for
very low and extremely low income households as well as a special needs population -veteran
families and chronic homeless veterans which require specialized case management to
successfully maintain housing. The projected costs are reasonable for the very low and extremely
low income households and the special needs housing; the lower income affordability and the
service-enriched development exceed the typical benefit of <)ffordable housing developments in
Carlsbad, but also increases the per unit cost requiring additional subsidy from the city. In
Carlsbad's Housing Elerne'nt, "special needs housing" includes seniors, persons with disabilities,
large households, single-parent families, homeless, farmworkers, students and military
personnel; it is not simply considered housing for the disabled. These populations have special
needs for affordable housing for a variety of reasons.
Because the development will have no Master Developer to provide for the land at no cost and/or
additional equity, additional funds of $85,000 per unit are required from the city to provide for
the full financing. Affirmed Housing also intends to apply for tax credit revenue and funding from
the Veterans Administration. At $4,250,000, the city's contribution to the financing would
represent about 20% of the total funding required for the development which is consistent with
our general underwriting policies.
Undue Gain
It is important that any financial assistance from the city have the effect of making the units
more affordable and not creating undue gain for any party. lffunded, the Developer will receive
a 11Developer Fee" of $2 million, or approximately 10% of total project costs (including land). The
requested developer fee is consistent with the city's, policies and is reasonable considering the
complexity of the development/construction, financing and the long term ownership and
management of special needs housing. It is important to note an unusual capitalized reserve fund
of $2.1 million for the supportive services is included in the development proforma. This
capitalized reserve, to be funded by Veterans Housing Program Funds, is necessary to provide for
the supportive services which could not be otherwise supported given the deeply targeted
extremely low income units within the development.
Subsidy Analysis
Affirmed Housing is proposing to finance the project with a variety offinancing sources, including
· state and federal tax credit equity together with a loan of veteran funding and a residual receipts
loan from the City of Carlsbad in the amount of $4,250,000 (or $85,000 per home). The land costs
amount to approximately 15% of total costs, which is reasonable considering the location of said
properties. The properties were purchased at fair market value. Staff and the Housing
Commission are recommending that the direct financial assistance from the city be provided to
the project in the amount requested for predevelopment and/or project construction purposes;
it is a reasonable request and the rents will be restricted to households at 30% to 50% of the San
Diego County Area Median Income, which are in the very low to extremely low income categories
and necessary to serve the special needs populations of the homeless veterans and the lower
income veterans and their families. This provides a substantial public benefit to the lower income
community in Carlsbad, and to these special needs veteran populations.
Form of Assistance
City cash assistance will be in the form of a residual receipts loan secured by a note and deed of
trust. The loan will begin accruing after the completion of construction of the improvements.
The outstanding principal and accrued interest on the city loan will be amortized over fifty-five
years and repaid from cash surplus in equal annual installments of principal and interest. In the
event that there is not adequate cash surplus to repay the city loan, the outstanding balance shall
accrue with simple interest at 3% per annum. The loan becomes due in full (with interest) at the
end of the fifty-five year term. To date, the city has been very successful in receiving regular
annual payments on all of its residual receipt loan. If, however, for any . reason there is not
adequate surplus funds to repay the loan during the term of the loan, the developer will be
required to obtain additional financing at the end of the loan term to repay the city loan or the
city could exercise an option to have ownership of the development asset transferred to the city.
Fortunately, the city's history to date has been favorable and several of the affordable
development loans have been, or are expected to be, repaid in advance of the term expiration.
The loan proceeds will be provided from the City of Carlsbad's Housing Trust Fund, which may
only be used for the purpose of providing affordable housing within Carlsbad.
Summary of uses and sources of funds
The developer's detailed proforma is attached as Exhibit 2. Below is a summary of the proforma:
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USES OF FUNDS
TOTAL PER UNIT
Land Payment/Costs $3,368,000 $67,360
Direct Construction $8,950,000 $179,000
Financing Fees $366,175 $7,324
Architecture/Engineering $750,000 $15,000
Impact Fees $860,000 $17,200
Other indirect/soft costs (including $7,065,000 $141,300
developer fee of $2 million and the
capitalized. reserve account of $2.1
million that is explained above)
Total Sources $21,359,175 $427,184
PERMANENT SOURCES OF FUNDS
TOTAL PER UNIT
Tax Credit Equity (State) $1,690,740 $33,815
Tax Credit Equity (Federal) $9,478,435 $189,569
Veteran Funding Loan $3,250,000 $65,000
Veteran Funding-Capital Reserve $2,000,000 $40,000
Permanent Loan $690,000 $13,800
City Contribution $4,250,000 $85,000
Total Sources $Zl,3~9,175 $427,184
Security
The Developer will be required to provide completion bonds to the city and the permanent lender
to insure that construction is completed.
Risk
In its role as a lender to the project, the city is exposed to three risks inherent to real estate
development. These risks generally include 1) predevelopment (project does not get to
construction), 2) construction (project cannot be completed, cost overruns, contractor
problems), and 3) operation (revenues do not cover expenses). Adding to this risk, any city
financial assistance will be subordinated to conventional and other financing as may be necessary
to ensure project financing success.
A number of factors mitigate the identified risks. First, the development team has a strong track
record with similar affordable housing projects both inside and outside the City of Carlsbad. The
presence of other major financial commitments, such as a tax credit investment, is also key as
this means that other stakeholders depend on the success of the project both short and long
term. Finally, the position of city and other subordinated financing is a feature that helps attract
the necessary private, state and federal financing.
Fortunately, the city's history has been favorable and several of the affordable development
loans have been, or are expected to be, repaid in advance of the term expiration. Therefore, the
city is confident in its lending practices. To date, the city has provided approximately $40 million
in loans to various affordable developments and developers. As noted above, the city has had a
successful track record in receiving residual receipt loan payments annually from affordable
housing developers. As a result of the repayments, the Housing Trust F.und has remained well-
funded throughout its history and provided the city with the ability to continue to make new
loans to produce new affordable housing.
SUMMARY
The financial assistance request was reviewed by the Housing Commission. Based on its review,
the Housing Commission is recommending approval of Affirmed Housing's request for financial
assistance based on several considerations, which are:
• The proposal's effectiveness in serving the city and special population needs and priorities
as expressed in the Housing Element of the General Plan and the Consolidated Plan .
• The proposal's consistency with the city's affordable housing policies and ordinances as
expressed in the Housing Element.
• The proposal's development and operating feasibility, emphasizing the development
team capacity, financing sources and the role of the city in providing financial assistance
or incentives.
• The development will also provide for a $2.1 million capitalized reserve that will ensure
that there are adequate operational funds to assist with case management and special
needs of the veteran populations.
Fiscal Analysis
Based on thorough analysis, staff and the Housing Commission have found that the proposed
Veterans Housing project involves a capable development team (Affirmed Housing) that is
committed to lower income affordable and special needs housing (military personnel and
homeless). The financing structure of the project appears to be sound. The proposed city
assistance meets the city's three key underwriting goals of a strong borrower, reasonable, project
costs (considering the special circumstances) and a high degree of leveraging. The project is of
high quality and exhibits good design and is ideally located. City housing goals are supported by
the project's unit mix and affordability, and the fact that the development is intended to meet
the special housing needs of homeless veterans and veteran families.
Staff is recommending that the City Council approve a $4,250,000 residual receipts loan to
Affirmed Housing for the Veterans Housing developments on Oak Avenue and Harding Street
within the City of Carlsbad. The loan proceeds will come from the city's Housing Trust Fund, which
funds may only be used for the single purpose of funding affordable housing programs and
developments for lower income households. The Housing Trust Fund has a current,
unencumbered balance of $13,340,000.
Existing Fund Balance Requested Loan Funds Remaining Fund Balance
$13,340,000 $4,250,000 $9,090,000
Next Steps
With approval of the City Council, appropriate documents, including a Financial Assistance
Agreement, Regulatory Agreement, Promissory Note, and Deed of Trust, will be prepared and
executed to set forth the terms of the financial assistance (loan) and its repayment. The
approving resolution authorizes the Chief Operations Officer to execute the loan documents after
review by the City Attorney.
Environmental Evaluation (CEQA)
The City Pianner determined that the developments belong to a class of projects that the State
Secretary for Resources has found do not have a significant impact on the environment and is,
therefore, exempt from the requirement for the preparation of environmental documents
pursuant to Section 15194 (Affordable Housing) of the State CEQA Guidelines.
Exhibits
1. Adopt a Resolution to provide a residual receipts loan in the amount of $4,250,000 from the
Carlsbad Housing Trust Fund to Affirmed Housing to assist with the financing of construction
of fifty (50) affordable apartment homes for homeless veterans and lower income veterans
and their families on noncontiguous sites in the northwest quadrant of the City of Carlsbad.
2. Financial Assistance Request, including development proforma, from Affirmed Housing and
other information materials provided by the developer.
EXHIBIT 1
RESOLUTION NO. 2017-030
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD, CALIFORNIA, APPROVING A
RESIDUAL RECEIPTS LOAN IN THE AMOUNT OF $4,250,000 FROM THE CARLSBAD HOUSING TRUST
FUND TO AFFIRMED HOUSING TO ASSIST WITH THE FINANCING OF CONSTRUCTION OF FIFTY (50)
AFFORDABLE APARTMENT HOMES FOR HOMELESS VETERANS AND LOWER INCOME VETERANS
AND THEIR FAMILIES ON TWO NONCONTIGUOUS SITES IN THE NORTHWEST QUADRANT OF THE
CITY OF CARLSBAD.
WHEREAS, Affirmed Housing has proposed to construct 50 apartment homes to be affordable
to lower income households within the City of Carlsbad for homeless veterans and lower income
veterans and their families on two noncontiguous sites within the historic Barrio Carlsbad
neighborhood of the City of Carlsbad, and has requested financial assistance from the City of. Carlsbad
fo assist in the financing of said affordable housing project; and,
WHEREAS, the Planning Commission approved said affordable housing development on January
18, 2017; and,
WHEREAS, the request for financial assistance from Affirmed Housing to construct said units
was submitted to the City of Carlsbad's Housing Commission for review and consideration, and said
Commission recommended that the City Council approve the requested financial assistance in the
amount of $4,250,000 at their public meeting on the 14th day of July, 2016.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Carlsbad, California, as
follows:
1. That the above recitations are true and correct.
2. The request for financial assistance from Affirmed Housing is consistent with the goals
and objectives of the City of Carlsbad's Housing Element, Consolidated Plan, and the
Carlsbad General Plan.
3. The request for financial assistance will assist the affordable housing developer in
constructing a total of 50, studio, one, two and three bedroom affordable apartment
homes for homeless veterans and lower income veterans and their families on two
noncontiguous sites within the Northwest Quadrant of the City of Carlsbad which will
be affordable to households ranging from 30% to 50% of area median income for San
Diego County. The project, therefore, has the ability to effectively serve the city's
housing needs and priorities as expressed in the Housing Element and the Consolidated
Plan, and to meet the housing and service needs of the special needs population of
homeless military veterans and lower income military veterans and their families.
EXHIBIT 1
4. That the City Council hereby approves financial cash assistance in the amount of
$4,250,000 from Carlsbad's Housing Trust Fund to Affirmed Housing Corporation for the
construction of fifty (50) affordable apartment homes on two noncontiguous sites
within the Northwest Quadrant of the City of Carlsbad, and within the historic Barrio
Carlsbad neighborhood, for homeless military veterans and lower income military
veterans and their families.
5. That the City Council authorizes the Chief Operations Officer to prepare and execute all
documents related to provision of the city assistance in the form of a residual receipts
loan, including but not limited to a Financial Assistance Loan Agreement, Note, Deed of
Trust, and Regulatory Agreement, subject to review and approval by the City Attorney.
PASSED, APPROVED AND ADOPTED at a Regular Meeting of the City Council of the City of
Carlsbad on the 14th day of February, 2017, by the following vote, to wit:
AYES:
NOES:
ABSENT:
M. Hall, K. Blackburn, C. Schumacher.
M. Packard.
M. Schumacher.
(SEAL)
Attachment B
CA Review C/<H
C I TY CO U NC I L
Staff Report
Meeting Date:
To:
From:
Staff Contact:
Subject:
Jan.28,2020
Mayor and City Council
Scott Chadwick, City Manager
David de Cordova, Principal Planner
david.decordova@carlsbadca.gov, 760-434-2935
Authorization to negotiate with Affirmed Housing Carlsbad (dba Veteran
Housing, L.P.) to acquire property at 3606-3618 and 3630 Harding Street
and 965-967 Oak Avenue, and approving $4,043,392 in additional financial
assistance to construct fifty affordable apartment units restricted for
homeless and lower income veteran families, as well as people experiencing
homelessness with Severe Mental Illness (SMI).
Recommended Action
Adopt a resolution to: 1) authorize the real estate manager to negotiate with Affirmed
Housing (Carlsbad Veteran Housing, LP.) to acquire property it owns at 3606-3618 ancf 3630
Harding Street and 965-967 Oak Avenue and to execute all documents necessary to provide
$4,043,392 in additional financial assistance to Affirmed Housing for construction of fifty (SO)
affordable apartment units for homeless and lower income veterans and their families,
and for homeless people with SMI, on two noncontiguous sites in the northwest quadrant
of the City of.Carlsbad; and 2) appropriate and authorize expenditure of $50,000 from tbe
Housing Trust Fund for costs related to the property acquisition and execution of
documents, including market appraisal services, relocation consultant services, outside
legal counsel expenses and other related transaction costs.
Executive Summary
Affirmed Housing has submitted a request to the City of Carlsbad for additional financial
assistance of $4,043,392 for the construction of 50 apartments for very low and extremely
low-income homeless veterans and veteran families, and people experiencing
homelessness with SMI. The City Council previously approved $4,250,000 in financial
assistance to the project (Resolution No. 2017-030; Feb. 14, 2017) in the form of a 55-year·
residual receipts loan with simple interest of 3% annually. Combined with this additional
request, the city's financial assistance would total $8,293,392, or $165;868 per unit.
The developer has secured $10,140,000 of No Place Like Home (NPLH) funds through the
County of San Diego in the form of a zero interest loan. The developer has also requested
funding through the California Low Income Housing Tax Credit Program to finance the
proposed development, which has an estimated total cost of $33,147;916.
Jan.28,2020
\
Item #18 Page 1 of 65
Discussion
On Jan. 181 2017, the Planning Commission unanimously approved a SO-unit affordable
apartment development, now known as WlndsorPointe, that will consist of development on
two noncontiguous properties (3606-3618 and 3930 Harding Street and 965-967 Oak Avenue)
Within the Barrio Carlsbad neighborhood in the city's northwest quadrant. The Harding Street
development will consi~t of 26 studio, one, two, and three-bedroom rental units. These rental
unitswill be available to veteran households at very low and extremely low incomes. Twelve of
the units will provide permanent supportive housing for people experiencing homelessness
with SMI. The Oak Street development will consist of 24 studio, one and two-bedroom rental
-units. These rental units will be available to veteran households at very low and extremely low
incomes_as well. As with the Harding Street development, 12 of the units will provide
permanent supportive housing for people experiencing homelessness with SMI.
All of the residents at Windsor Pointe will have access to dedicated on-site services, including
services intended to improve housing retention, health, education and employment/career
opportunities. Further, residents in the NPLH units will receive intensive mental health services
through the County of San Diego. Dedkated case managers will work with the residents on an
individuatcase pfan, offer assistance in app-lying for benefits, and provide linkages to other
community services. Affirmed Housing-has partnered with the County of San Diego to be the
service provider.
Affirmed Housing will developJ own, and operate Windsor Pointe. Affirmed Housing is
experienced and nas recognized expert1se in developing high quality affordable apartment
communities throughout the state _and within San Diego County, including the Cassia Heights
Apartments in Carlsbad (Exhibit 4 ). Affirmeq Housing also owns and operates afforda,ble
housing developmen't? in other areas of 5an Diego and Los Angeles counties, aswell as the San
Francisco Bay Area. Affirmed H9using has a history of building top quality housing
developments and operating/managing them i,A cin outstanding manner. The developer has also
developed, owns and manages other affordable homes for special needs populations, such as
homeless and lower income veterans.
In considering any financial assistance request for an affordable housing development, staff and
the Housing Commission reviewed several factors. The analysis of the developer request is
discussed below.
Affirmed Housing provided for the city's review a development proforma (Exhibit 3), which
coincides with Affirmed Housing's Nov. 2019 federal four percent and state low income housing
tax credit application (4%tax credits). Should the 4%_ tax credits application he unsuccessful,
Affirmed Housing has stated their intent to applyforthe 9% tax credits when offered in Mardi
2020: While the amount of tax credits requested and er the 9%-program may vary from the
current application, the· amount of assistance requested of the city Would be the same. A_s of
Jan. 9, 2019, the California Tax Credit Allocation Committee (CTCAq staff have made a
preliminary recommendation to place the Windsor Pointe project on a waiting list for funding,
pending the completion of application scoring by the California Debt Limit Allocation
Committee (CDLAC). Once the CDLAC results are reported to CTCAC, final funding
Jan.28,2020 Item #18 Page 2 of 65
recommendations will be made. Therefore, the 4% tax credits proforma forms the basis of the
following analysis'.
Cost Reasonableness
Since development costs are one of the key variables determining the need for subsidies, it is
important that those costs be reasonable. At approximately $33.1 million in total developmerit
t:osts (including land), the average per unit development cost of approximately $663,000 is, in
fact, high as compared to other city-assisted developments. There are a number of re_asons for
this. First, is land cost. Because there is no master developer to underwrite the project to satrsfy
an inclusionary housing requirement, the properties were purchased _at market valuet
representing approximately 13% of total project costs. However, the cost is reasonable
considering the continuing high cost of land in Carlsbad, especially in the northwest quadrant of
the city.
Second, construction costs are increasing. For example, the Tern er Center reports that,
between 2011 and 2016, construction costs in the Los Angeles area rose 13.6%, compared to
11.8% nationwide.1 Regulations, market dynamics and construction efficiency are cited as the
three major influencers of construction costs. The residential construction labor force
contracted sharply duringthe Great Recession and is still recovering. Construction materials
costs increased 4.8% overall in the past year. In addition; the Windsor Pointe project will pay
prevailing wages for construction labor. .
Third, development design affects the project's cost. This development is intended to be
constructed specifically to provide affordable housing for very low and extremely low-income
households as well as a special needs population -Veteran families and chronic homeless.with
SMI which require specialized case management to successfully maintain housing. The project
will include a concrete podium to accommodate ground floor parking; with wood framing
construction on the second and third floors. The project will also provide ample community
space, accessible and adaptable ADA standards, and higher energy efficiency (Green Point
certified) than a typical apartment building.
Fourth, some of the.existing rental units on the project sites are occupied. Relocation assistance
is required by state and federal regulations due to the use of public fonds. As a project funder,
the city will ensure that relocation assistance is carried out in conformance with applicable
regulations and the City of Carlsbad Relocation Plan . Relocation assistance expenses of up to
$331,000 are included in the project proforma.
The per unit cost of this project, aJthough high, is within the range of similar projects recently
constructed by Affirmed Housing. For example, special needs apartments under construction or
completed Since 2017 have ranged between approximately $525,000 and $673,000 per unit
(Exhibit 4). A recent report from the City of Los Angeles city auditor estimated the median per
unit cost for permanent supportive housing in that city at more than $530,000.2
1 Terner Center for Housing tnnovati9n. https://ternen::enter.berkeley.edu/construction-costs
z As reported by CalMatters, 12/31/19. https://calmatters.org/explainers/californias-homelessness-crisis-
explained/
Jan.28,2020 Item #18 Page 3 of 65
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-1 I
l
The projected costs are reasonable for the very low and extremely low-income households and ·
the special needs housing; the. lower lncome affordability and the service-enriched
development exceed the typical benefit of affordable housing developments in Carlsbad, but
also increases the per unit cost warranting additional subsidy from the city. In Carlsbad's
Housing Element, "special needs housing" includes seniors, persons with disabilities, large
households, single-parent families, homeless, farmworkers, students and military personnel; it
is not simply considered housing for the disabled. These populations have special needs for
affordable housingfor a variety of reasons.
Since the development will have no mast.er developer to provide the land at no cost ·and/or for
additional equity, additional funds are being requested from the city to provide the remainder
oftbe full financing. The current request for $4,043,3~2, when combined with the previous
$4,250,000 commitment1 would provide a total city financial contribution of $8,293,392. This
woul~ .be the largest contribution of local affordable housing funds to a single project to date.3
On a per unit basis, the $165,868 subsidy would be near the upper end of the range for city-
assisted affordable housfng projects. The city subsidy woyld represent about 25% of the total
funding required for the development, which is at the high end of the range compared to other
city-assisted projects. However, for reasons discussed below, the-relatively large financial
request is reasonable in light of the relatively large public benefit that will result from the
project.
Undue Gain
It is important that any financial assistance from the city have the effect of making the units
more affordable ar\d not cr~ating undue gain for any party. If funded under the 4% tax credits
program, Affirrned Housing would be eligi•ble to earn a develober fee of$2,500,000. However,
to reduce the financing gap, Afflrmed Housing has committed to contribute $500,000 of the
developer fee backto the project. The net fee would be 6% of total projeGt costs (including
land}, which i:S consiste·nt wifh the city's policies and is reasonable consfderi □g the complexity of
the development/construction, financing and the long-term ownersh:ip and management of
special needs housing. A capitalized reserve fund of$5,679,000 as an operating subsidy is
included in the development proforma. This capitalized reserve, $4,875,000 of which will be
funded by the NPLH program, is necessary for operations which could not be otherwise
supported giventhe deeply targeted extremely low~income units within tbe development.
Given the complex nature of this type of project; tlS well as the contribution of a portion of the
earnec;f developer fee back to the prnject4, the city's financial assistance would not create an
undue financial gain.
Pub.lie Benefit
Another consideration in evaluating the merit of the financial assistance request is the level of
public benefit that will accrue. This can be examined in a number of ways: 1) the leveraging
3 The largest financial contribution made by the.city to date took place in 2013,a $7.4 million residual receipts loan
to acqulre 44 existing duplex units in the Barrio and redevelop the property into a 1argermulti~family project.
4 This assumes the developer receives 4%tax credit funding. The fee that could be earned woutd be less under the
9% tax credit program, and so would overall project costs. The city's total financial commitment would not change.
Jan.28,2020 Item #18 Page 4 of 65
. i
effect on other sources of public and private equity; 2) the housing need being served; and 3)
synergies with other city policies ahd priorities.
1.) In addition to this funding request of $4,043,392, Affirmed Housing proposes to finance the
project from a variety of sources, including proposed state and federal tax credit equity
{$14,214,524) together with awarded County of San Diego NPLH funds {$10,140,000) and the
previous city loan wmmitment {$4,250,000). Thus, every dollar of city assistance will leverage
three dollars in capital from outside sources. In addition, the County of San Dlego has
committed fa providing ease management and mental health services to the NPLH residents at
the Windsor Pointe project.
It is importantto note that Affirmed Housing has attempted to secure funding from other
sources. prior to making this supplemental request of the city. As stated in their Dec~ 2Q, 2019
r~q1.1est letter {Exhibit 3), Affirmed Housing made two unsuccessful attempts {February 2017
and July 2018) to secure competitive Veterans Housing and Homelessness Prevent}on (VHHJ>)
Program funds from tne California Department of Housing and Community Development (HCD)
and one-unsuccessful attempt to secure funding from the County of San Diego Innovative
Housing Trust Fund (March 2018).
2.) The project will provide housing and supportive services to some of the most vulnerable
members of our community,_narnely, very low and extremely low-income homeless veterans
and veteran families~ and people experiencing homelessness with severe mental illness.
Rents will be restricted to households at 25% to 50% of the San Diego County Area Median
Income, which are in the extremely low to very low-income categories. These rent levels are
necessary to serve the intended lower income special needs populations. According to the 2018
City of Carlsbad Annual Housing Element Progress Report, only 42 of the 912 units needed t.o
satisfy Carlsbad's share of regional very low (and extremely low) income housing needs have
been built since 2013. Furthermore, Carlsbad will need to plan to accommodate at least 1,311
very low-income housing units for the upcoming 2021-29 Housing Element cycle.
According to the 2019 regional Point-in-Time homeless count, there are 161 homeless
individuals living in Carlsbad, 102 of whom are unsheltered. In 2018~19, twenty-seven percent
of the 1,142 homeless men, women and children that were served in north San Diego county
shelters suffer from mental health problems.
3.) The proposed project meets a critical housing need as identified in the city's Housing
Element. In addition to helping meet the regional housi11g share discussed above, Housing
Element Progro:1ms 3.13 and 3.14 describe actjons the city will take to provide housing and
supportive services to homeless and special needs populations. Similarly, the city's
Consolidated Plan establishes high priority uses of housing funds, including increasing the
supply of affordable housing units and providing supportive services forthe homeless, lower-
income residents and persons with special needs.
In October 2017, the City Council approved the Homeless Response Plan (HRP), which is
intended to: 1) prevent, reduce and manage homelessness in Carlsbad; 2) support and build
capacity within the city and community to address homelessness; 3) encourage collaboration
within the city, community partnerships and residents; and 4) retain, protect, and increase the
Jan.28,2020 Item #18 Page 5 of 65
supply of housing. The HRP is being implemented under the leadership of the city's Police
Department in coordination with Housing Services and other city departments. Progress of the
HRP is monitored by the Housing Commission and City Council.
An ad hoc subcommittee of the Carlsbad City Council has been working with elected officials
from other north county cities, the County of San Diego, regional service providers, transit
agencies, local community colleges and university, and state legislative representatives to
develop an action plan to address homelessness in the north county region. The group has'
established a goal to reduce unsheltered homelessness 50% by January 2022 by, among other
things, increasing both short-term and long-term housing options for people experiencing
homelessness.
Based on the above, the city's financial assistance to this project will provide substantial public
benefit by leveraging additional capital resources, provide needed extremely low and very-low
income housing, and address the special needs of homeless veterans and their families, and
homeless persons with severe mental illness.
Form of Assistance
Staff and the Housing Commission recommend that $4,043,392 in financial assistance from the
city's affordable housing funds be provided to the Windsor Pointe project, which is in addition
to the February 2017 commitment of $4,250,000 in the form of a residual receipts loan.
However, rather than providing the entire subsidy in the form of a loan, staff recommends that
the City Council authorize staff to enter 1nto negotiations with Affirmed Housing {dba Carlsbad
Veteran Housing, LP.) to purchase the property at an agreed-upon price up to its market value
and lease back the land for a nominal amount, such as $1 per year. The balance ofthe financial
assistance would be in the form of a residual receipts loan secured by a note and deed of trust.
The loan will begin accruing interest after the completjon of construction of the improvements.
The outstanding principal and accrued interest on the city loan will be amortized over 55 years
and repaid from surplus cash (the amount of money left over, if any, after expenses are covered
by income and operating reserves) in equal annual installments of principal and interest. In the
event that there is not adequate surplus to repay the city loan, the outstanding balance shall
accrue with simple interest at 3% per annum. The loan becomes due in full (with interest) at the
end of the 55-year term.
Jan.28,2020 Item #18 Page 6 of 65
Summary of vses and.sources of funds
The developer's detailed proforma is included in Exhibit 3. Below is a summary of the proforma:
SUMMARY PROFORMA
USES OF FUNDS
TOTAL PER UNIT
Land Payment/Costs $4,245,791 $84,916
Direct Construction 15,046,752 300,935
Capitalized Reserves 5,679,000 113,580
Architecture/Engineering 950,000 19,000
· Impact Fees and Permits 962,000 19,240
Other indirect/Soft Costs {including $2.5 6,264,373 125,287
million developer fee)
TOTAL USES $33,147,916 $662,958
PERMANENT SOURCES OF FUNDS
TOTAL PER UNIT
Tax Credit Equity {State) $5,132,628 $102,652
Tax Credit Equity (Federal) 9,081,896 181,638
NPLH Capital 5,265,000 105,300
NPLH Capital Gperating Subsidy Reserve 4,875,000 97,500
Committed City Contribution 4,250,000 85,000
Additional City Contribution 4,043,392 801868
Contribution of Developer Fee Earned 500,000 10,000
TOTAL SOURCES $33,147,916 $662,958
Security
The developer witr be requir~d to provide c-ompJetion bonds to the city to. ensure that
construction is completed.
Risk
In its role as a lender to the project, the city is exposed to three risks inherent to real estate
development. These risks generally include 1) predeveJopment (project does not get to
construction); 2) coAstrucfion (project cannot be completedJ cost overruns, contractor .
problems); and 3) operation (revenues do not cover expenses). -Adding to this risk, any city
financial assistance will be s□bordinated to conventional and other financing as may be
necessary to ensure project financing success.
Several factors mitigate the identified risks. First, the development team has a strong track
reco'rd with similar affordable housing projects both inside and outside the City of Carlsbad. The
presence of other major financial commitments, such as the County of San Diego commitment
of NPLH funding, mental health and supportive services, and. tax credit investment, is also key
as this means that other stakeholders depend on the success of the project both short and long
term. Finally, the position of city and other subordinated financing is a feature that helps attract
the necessary private, state and federal financing,
Jan.28,2020 Item #18 Page 7 of 65
To further mitigate risk to the city's financial contribution, staff is seeking authority from the
City Council to negotiate purchase of the land for the project and lease back the land to
Affirmed Housing (dba Carlsbad Veteran Housing, LP.). Additionally, the balance of the
assistance will take the form of a residual receipts loan, secured by a leasehold deed of trust;
and other appropriate security interests in the project improvements. Additionally, staff
recommends that the city's financial commitment (both the previous commitment and any new
commitment) be maintained for only as long as the County of San Diego's NPLH commitment;
that is, 24 months from August 16, 2019, or three tax credit fonding rounds, whichever occurs
earlier. This way, the committed funds could be released and made available to other projects
in the city in the event the Windsor-Pointe project is ultimately unsuccessful in securing all
other funding.
General Plan Conformance
Acquisition of the property is in conformance with the Carlsbad General Plan in that the
proceeds from the acquisition will provide financial assistance to Affirmed Housing to construct
Windsor Pointe Apartments, a SO-unit residential project on two non-contiguous sites. The
property is designated for residential use by the Gener_al Plan Land Use map, and the citys
purchase of the property will not change its intended residential use. Furthermore, the
intended use of the property is consistent with the General Plan Land Use and Community
Design Element with respect to land use compatibility, residential density, and infill
development policies; and the Housing Element with respect-to goals to increase the supply of
affordable housing.
Housing Commission Review
The financial assistance request was reviewed by the Housing Commission on Jan. 17, 2020.
Based on its review, the Housing Commission recommends approval of Affirmed Housing's
request for financial assistance based on the findings contained in the Housing Commission
Resolution (Exhibit 2).
Fisca l Analysts
Staff is recommending that the City Council approve $4,043,3~92 in additional financial
assistance to Affirmed Housing for the Windsor Pointe housing developments on Oak Avenue
and Harding Street within the City of Carlsbad . This amount is in addition to the $4,250,000 in
assistance approved by the City Council in February 2017. The land purchase and supplemental
loan financing proceeds will come from the city's affordable housiflg funds (Affordable Housing
Trust Fund and St.Jccessor Agency Housing Trust Fund), which may only be used for funding
affordable housing programs and developments for lower income howseholds. The citys
affordable housing funds have an available balance of $21.7 million prior to making any
financial contributions to the Windsor Pointe housing developments.
CDBG funds, to the extentthey are available during the project's development timeline, may be
used to assist with the land purchase, thereby reducing the impact on the city's affordable
housing funds.
Jan.28,2020 Item #18 Page 8 of 65
Next Steps
The real ·estate manager will enter into negotiations to purchase the land and lease back to
Affirmed Housing (dba Carlsbad Veteran Housing, LP.), and prepare and execute all appropriate
documents, including, but not limited to: a Financial Assistance Agreement; Purchase/Sale
Agreement; Grant Deeds; Ground Lease Agreements; Regulatory Agreement; Promissory Note;
and Deed of Trust, necessary to provide for the financial assistance. The approving resolution
authorizes the real estate manager to negotiate the land purchase and ground lease, retain
professional services, and execute all necessary documents after review by the city attorney.
Environmental Evaluation (CEQA)
The city planner determined that the development belongs to a class of projects that the State
Secretary for Resources has found do not have a significant impact on the environment and is,
therefore, exempt from the requirement for the preparation of environmental documents
pursuant to Section 15194 (Affordable Housing) of the State CEQA Guidelines.
If the city provides CDBG funding towards the land purchase, environmental review pursuant to
the National Environmental Policy Act (NEPA) will be completed in accordance with federal
regulations.
Public Notification
This item was noticed in accordance with the Ralph M. Brown Act and was available for public
viewing and review at least 72 hours prior to the scheduled meeting date.
Exhibits
1. City Council resolution
2. Housing Commission resolution
3. Financial Assistance Request, including development proforma, from Affirmed Housing
4. Affirmed Housing company profile and representative projects
Jan.28,2020 Item #18 Page 9 of 65
RESOLUTION NO. 2020-032
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD,
CALIFORNIA, AUTHORIZING THE REAL ESTATE MANAGER TO NEGOTIATE
WITH AFFIRMED HOUSING (DBA CARLSBAD VETERAN HOUSING, L.P.) TO
ACQUIRE PROPERTY AT 3606-3618 AND 3630 HARDING STREET AND 965-
967 OAK AVENUE, AND APPROVING $4,043,392 IN ADDITIONAL FINANCIAL
ASSISTANCE TO CONSTRUCT FIFTY (50) AFFORDABLE APARTMENT UNITS
RESTRICTED FOR HOMELESS AND LOWER INCOME VETERAN FAMILIES, AS
WELL AS PEOPLE EXPERIENCING HOMELESSNESS WITH SEVERE MENTAL
ILLNESS
WHEREAS, Affirmed Housing has proposed to construct 50 apartment homes to be affordable
to for very low and extremely low-income homeless veterans and veteran families, and people
experiencing homelessness with severe mental illness (SMI), on two noncontiguous sites located at
3606-3618 and 3630 Harding Street and 965-967 Oak Avenue in the city's northwest quadrant, and has
requested financial assistance from the City of Carlsbad to assist in the financing of said affordable
housing project; and
WHEREAS, the first request for financial assistance was submitted to the City of Carlsbad's
Housing Commission for review and consideration at their public meeting on July 14, 2016, on which
date said Commission recommended that the City Council approve the requested financial assistance
in the amount of $4,250,000; and
WHEREAS, the Planning Commission approved said affordable housing development, now
known as Windsor Pointe Apartments, on Jan. 18, 2017; and
WHEREAS, at a public meeting on Feb. 14, 2017, the City Council reviewed the financial
assistance request and after considering staff and Housing Commission recommendations, and all
testimony of all persons desiring to be heard, approved the financial cash assistance in the amount of
$4,250,000 from Carlsbad's Housing Trust Fund (City Council Resolution No. 2017-030); and
WHEREAS, subsequent to the project and city financial assistance approvals, Affirmed Housing
has diligently pursued financing from other sources, which have been partly successful to date,
including the commitment offunding from the County of San Diego; and
Jan.28,2020 Item #18 Page 10 of 65
WHEREAS, despite the additional funding secured and anticipated, due to high construction
costs and the complexities of creating financially feasible supportive housing, there remains a funding
gap for the Windsor Pointe Apartments; and
WHEREAS, on Dec. 20, 2019, Affirmed Housing made a second request to the City of Carlsbad
for additional financial assistance in the amount of $4,043,392 to close the funding gap; and
WHEREAS, the Housing Commission held a special meeting on Jan. 17, 2020 to consider the
financial assistance request, staff evaluation and recommendation, and the testimony of all persons
desiring to be heard on the matter, and upon which the Housing Commission recommended approval
of the additional financial request in the amount of $4,043,392.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Carlsbad, California, as
follows:
1. That the above recitations are true and correct.
2. That the request for financial assistance from Affirmed Housing is consistent with the
goals and objectives of the City of Carlsbad's Housing Element, Consolidated Plan, and
other priority policy initiatives such a$ the Homeless Response Plan.
3. That the city's acquisition of property located at 3606-3618 and 3630 Harding Street and
965-967 Oak Avenue is in conformance with the Carlsbad General Plan in that the
proceeds from the acquisition will provide financial assistance to Affirmed Housing to
construct Windsor Pointe Apartments, a SO-unit residential project on two non-
contiguous sites. The property is designated for residential use by the General Plan Land
Use map, and the city's purchase of the property will not change its intended residential
use. Furthermore, the intended use of the property is consistent with General Plan goals
and programs, including:
a. Land Use and Community Design Element Goal 10-G.3, "Promote infill development
that makes efficient use of limited land supply, while ensuring compatibility and
integration with existing uses. Ensure that infill properties develop with uses and
development intensities supportive a cohesive development pattern."
Jan.28,2020 Item #18 Page 11 of 65
b. Housing Element Goal 10-G.3, "Sufficient new affordable housing opportunities in
all quadrants of the city to meet the needs of current lower and moderate income
households and those with special needs, and a fair share proportion of future lower
and moderate income households."
c. Housing Element Program 3.4 City-initiated Development, "The city, through the
Housing and Neighborhood Services division, will continue to work with private
developers (both for-profit and non-profit) to create housing opportunities for low,
very low, and extremely low-income households."
4. That the request for financial assistance will assist the affordable housing developer in
constructing a total of 50, studio, one, two and three-bedroom affordable apartment
units for homeless veterans and lower income veteran families, as well as people
experiencing SMI, on two noncontiguous sites located at 3606-3618 and 3630 Harding
Street and 965-967 Oak Avenue in the city's northwest quadrant. The apartment units
will be affordable to households ranging from 25% to 50% of area median income for
San Diego County. The project, therefore, can effectively serve the city's housing needs
and priorities as expressed in the General Plan Housing Element and the Consolidated
· Plan, and to meet the housing and service needs of the special needs population of
homeless military veterans and lower income military veterans and their families, as
well as people experiencing homelessness with SMI.
5. That the City Council hereby approves the additional financial assistance in the amount
of $4,043,392 from the city's affordable housing funds to Affirmed Housing (dba
Carlsbad Veteran Housing, LP.) for the construction of fifty (50) affordable apartment
units on two noncontiguous sites located at 3606-3618 and 3630 Harding Street and
965-967 Oak Avenue in the city's northwest quadrant, for homeless military veterans
and lower income military veterans and their families, including homeless veterans, as
well as people experiencing homelessness with SMI. This additional assistance shall be
combined with the $4,250,000.previously approved on Feb. 14, 2017, for a total financial
assistance amount of $8,293,392. The assistance shall be provided as a combination of
property acquisition by the City of Carlsbad and lease-back of the Windsor Pointe
Jan.28,2020 Item #18 Page 12 of 65
Apartments sites to Affirmed Housing, and a residual receipts loan. The source offunds
shall be the city's affordable housing trust funds.
6. · That Community Development Block Grant (CDBG) funds, to the extent they are
available within the project development timeline, may be used towards the property
acquisition, with a corresponding reduction to affordable housing trust funds assistance.
7. That the deputy city manager, administrative services shall appropriate funds necessary
to purchase the land at an agreed-upon price up to its fair market value, and shall
appropriate $50,000 from the Housing Trust Fund for costs related to the property
acquisition and execution of documents, including market appraisal services, relocation
consultant services, outside legal counsel and other related transaction costs.
8. That the City Council authorizes the real estate manager to negotiate with Affirmed
Housing (dba Carlsbad Veteran Housing, L.P.) to acquire property at 3606-3618 and 3630
Harding Street and 965-967 Oak Avenue at an amount not to exceed the appraised fair
market value, and to lease back said property to Affirmed Housing (dba Carlsbad
Veteran Housing, L.P.) at $1 per year.
9. That the City Council authorizes the city manager or designee to execute all documents
related to provision of the city assistance in the form of a residual receipts loan,
including but not limited to a Financial Assistance Loan Agreement, Note, Deed of Trust,
and Regulatory Agreement, subject to review and approval by the City Attorney.
10. That this financial commitment is conditional and contingent upon Affirmed Housing
receiving all necessary third-party funding commitments, including tax credits and
successful negotiation of all required property transfers, loan documents and legal
instruments to effectuate the transaction and implement development. The city's
commitment of funds, including the previous commitment approved on Jan. 17, 2017,
shall be maintained until Aug. 16, 2021, or three tax credit funding rounds, whichever
occurs earlier, but may be withdrawn at any time if satisfactory progress is not
demonstrated.
Jan.28,2020 Item #18 Page 13 of 65
11. That, to the extent consistent with applicable law, a preference shall be given to
Carlsbad residents, and/or households with an individual that works in Carlsbad, for
tenancy at Windsor Pointe Apartments.
PASSED, APPROVED AND ADOPTED at a Regular Meeting of the City Council of the City of
Carlsbad on the 28th day of January, 2020, by the following vote, to wit:
I
AYES: Hall, Blackburn, Bhat-Patel, Shumacher
NAYS: None
ABSENT: None
~eclcr(;0mez/
BARBARA ENGLESON, City Clerk /)ep,v::J
(SEAL) Ci-:J
C!CIJI'"
Jan. 28, 2020 Item #18 Page 14 of 65