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HomeMy WebLinkAboutReso 2001-401 RESOLUTION NO. 2001-401 (,tGENCY RESOLUTION NO. 1760) RESOLUTION OF THE CITY COUNCIL AND THE REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA [A] APPROVING A LOAN AGREEMENT AND RELATED RESTRICTIVE COVENANTS AND THE AFFORDABLE HOUSING AGREEMENT BY AND BETWEEN THE REDEVELOPMENT AGENCY AND SOUTH BAY COMMUNITY VILLAS, L.P. AND AUTHORIZING THE CHAIRMAN OF THE REDEVELOPMENT AGENCY TO EXECUTE SAID AGREEMENTS; [B] APPROPRIATING $4,400,000 FROM THE UNAPPROPRIATED BALANCE 1N THE LOW AND MODERATE-INCOME HOUSING FUND FOR FINANCIAL ASSISTANCE TO SOUTH BAY COMMUNITY VILLAS, L.P.; lC] APPROVING A TEN YEAR DEFERRAL OF THE PUBLIC FACILITIES DEVELOPMENT IMPACT FEE AND WAIVER OF THE PARK FEE AND RESIDENTIAL CONSTRUCTION TAX; AND [D] APPROVING A DEFERRAL AGREEMENT FOR THE PUBLIC FACILITIES DEVELOPMENT IMPACT FEE, AND AUTHORIZING THE MAYOR TO EXECUTE SAID AGREEMENT FOR THE DEVELOPMENT AND OPERATION OF HERITAGE TOWN CENTER WHEREAS, Califomia Health and Safety Code Sections 33334.2 and 33334.6 authorize and direct the Redevelopment Agency of the City of Chula Vista (the "Agency") to expend a certain pementage of all taxes which are allocated to the Agency pursuant to Section 33670 for the purposes of increasing, improving and preserving the community's supply of low and moderate-income housing available at affordable housing cost to persons and families of low and moderate-income, lower-income, and very low-income; and WHEREAS, pursuant to applicable law the Agency has established a Low and Moderate-Income Housing Fund (the "Housing Fund"); and WHEREAS, pursuant to Health and Safety Code Section 33334.2(e), in carrying out its affordable housing activities, the Agency is authorized to provide subsidies to or for the benefit of very-low-income and lower-income households, or persons and families of low or moderate-income, to the extent those households cannot obtain housing at affordable costs on the open market, and to provide financial assistance for the construction and/or rehabilitation of housing which will be made available at an affordable housing cost to such persons; and WHEREAS, pursuant to Section 33413(b), the Agency is required to ensure that at least 15 percent of all new and substantially rehabilitated dwelling units developed within a project area under the jurisdiction of the Agency by private or public entities or persons other than the Agency shall be available at affordable housing cost to persons and families of low or moderate-income; and WHEREAS, South Bay Community Villas, L.P., a partnership between The Otay Ranch Company and South Bay Community Services, ("Developer") proposes to construct a multi- family housing development consisting of 91 units for senior citizens and 180 units of family Resolution 2001-401 - Page 2 housing, within the Otay Ranch master planned community. The residential units will consist of 30 units affordable to very-low-income households at or below 50 percent of the Area Median Income ("AMI"), with 10 of those units for senior citizens, 101 units affordable to low-income households at or below 60 percent of AMI, with 33 units for senior citizens, and the remainder of the units affordable to moderate income households at or below 120 percent of the Area Median Income, with 47 of these moderate income units for senior citizens, to be located on East Palomar Street between Santa Rita Avenue and Santa Andrea Avenue within a multi-family and commercial area identified in the Otay Ranch Village 1 tentative map as R47 & C1 ("Project"); and WHEREAS, the Developer requires assistance to reduce the development costs for the construction of the residential units in order to make the Project feasible; and WHEREAS, Chula Vista Municipal Code §17.10.070 provides that the City Council may waive all or any portion of the park lands dedication or fee requirements upon finding that said waiver will stimulate the construction of housing for low and moderate-income families; and WHEREAS, in accordance with Chula Vista Municipal Code §3.32.050, the Planning Commission may recommend that the City Council waive all or a portion of this tax for any dwelling-unit types constructed which would serve as housing for low and moderate-income families; and WHEREAS, the Planning Commission approved a recommendation to waive the applicable Residential Construction Tax for the Project, estimated at $74,200; and WHEREAS, the City of Chula Vista (the "City") wishes to defer for a ten year period the applicable Public Facilities Development Impact Fee (PDIF) for the 91 senior housing units ($238,238) and waive the Park Fee ($355,466 for land and improvements) and Residential Construction Tax ($74,200) to assist in reducing the development costs for the construction of the residential units of the Project; and WHEREAS, in order to carry out and implement the Redevelopment Plan for the Agency's redevelopment projects, the City's Consolidated Plan and the affordable housing requirements and goals thereof, the Agency and City propose to enter into an Agency Loan Agreement and Related Restricted Covenants (the "Agency Loan Agreement") and the City PDIF Deferral Agreement (the "Deferral Agreement"), respectively, with the Developer, together with an "Affordable Housing Agreement" which would be recorded as an encumbrance to the Project, pursuant to which the Agency would make a loan to the Developer (the "Agency Loan"), and the Developer would agree to develop and operate the Project in accordance with the requirements of the Agency Loan Agreement, restrict occupancy of 131 of the apartment units in the Project to very-low and lower-income households and 140 of the apartment units to moderate-income households, and rent those units at an affordable housing cost; and WHEREAS, the Agency Loan Agreement will leverage the investment of the Agency by requiring the Developer to obtain additional financing for the construction and operation of the Project through a combination of a loan obtained from the proceeds of multi-family mortgage revenue bond financing and an equity contribution by a limited partner investor in consideration for the "4% Tax Credits" to be generated by the Project; and Resolution 2001-401 Page 3 WHEREAS, in carrying out its affordable housing activities, the Agency may subordinate its affordability covenants or restrictions to the lien, encumbrance, or regulatory agreement of a lender or from a bond issuance providing financing of rental units if certain requirements, as specified in Health and Safety Code Section 33334.14(a), are met; and WHEREAS, the Project is located outside of the Agency's redevelopment project areas, but the acquisition, construction and operation of the Project pursuant to the Loan Agreement would benefit the Agency's redevelopment project areas by providing affordable housing for persons who currently live and work within those redevelopment project areas; and WHEREAS, the Agency has adopted an Implementation Plan pursuant to Health and Safety Code Section 33490, which sets forth the objective of providing housing to satisfy the needs and desires of various age, income and ethnic groups of the community, and which specifically provides for the development and operation of rental housing units through Agency assistance; and WHEREAS, the Agency Loan Agreement furthers the goals of the Agency to facilitate the creation of affordable housing which will serve the residents of the neighborhood and the City as set forth in the Implementation Plan and the Consolidated Plan; and WHEREAS, the Legislature declares in Health and Safety Code Section 37000, et seq., that new forms of cooperation with the private sector, such as leased housing, disposition of real property acquired through redevelopment, development approvals, and other forms of housing assistance may involve close participation with the private sector in meeting housing needs, without amounting to development, construction or acquisition of low-rent housing projects as contemplated under Article XXXIV of the State Constitution; and WHEREAS, Health and Safety Code Section 37001 provides that a low-rent housing project under Article XXXIV of the State Constitution does not include a development which is privately owned housing, receiving no ad valorem property tax exemption, other than exemptions granted pursuant to subdivision (f) or (g) of Section 214 of the Revenue and Taxation Code, and less than 49 percent of the units within the Project will be occupied by persons of low and very-low-income; and WHEREAS, the Project will not receive any ad valorem property tax exemption, other than exemptions granted pursuant to subdivision (f) or (g) of Section 214 of the Revenue and Taxation Code, and the Agreement restricts less than 49 percent of the units within the Project to persons of low and very-low-income; and WHEREAS, Health and Safety Code Section 37001.5 provides that a public body does not develop, construct, or acquire a low rent housing project under Article XXXIV of the State Constitution when the public body provides assistance to a low rent housing project and monitors construction and/or rehabilitation of the project to the extent of carrying out routine governrnental functions, performing conventional activities of a lender, and imposing constitutionally mandated or statutorily authorized conditions accepted by a grantee of assistance; and Resolution 2001-401 Page 4 WHEREAS, the Loan Agreement provide for assistance by the Agency to the Project, and the Agency's monitoring of construction of the Project to the extent of carrying out routine governmental functions, performing conventional activities of a lender, and imposing constitutionally mandated or statutorily authorized conditions accepted by a grantee of assistance; and WHEREAS, the Agency have duly considered all terms and conditions of the proposed Agency Loan Agreement and Affordable Housing Agreement and believes that the Loan Agreement and Affordable Housing Agreement are in the best interests of the Agency and the health, safety, and welfare of its residents, and in accord with the public purposes and provisions of applicable State and local law requirements; and NOW, THEREFORE, THE CITY COUNCIL AND REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA DO RESOLVE AS FOLLOWS: Section 1. The Agency hereby finds that the use of funds from the Agency's Low and Moderate Income Housing Fund pursuant to the Loan Agreement, for the development and operation of real property will be of benefit to the Agency's redevelopment project areas for the reasons set forth above. Section 2. The Agency hereby finds that an economically feasible alternative method of financing the Project on substantially comparable terms and conditions, without subordination, is not reasonably available and the Agency will receive written commitments reasonably designed to protect the Agency's investment in the event of default. Section 3. The Agency hereby determines that the Project is not a "low-rent housing project" within the meaning of Article XXXIV of the State Constitution, and that the assistance to be provided pursuant to the Loan Agreements does not constitute development, construction or acquisition of a low-rent housing project within the meaning of Article XXXIV of the State Constitution. This Resolution is hereby deemed to constitute a final approval of a proposal, which may result in housing assistance benefiting persons of low-income, within the meaning of Health and Safety Code Section 36005. Section 4. The Agency hereby IA] approves the Agency Loan Agreement and Affordable Housing Agreement in substantially the form presented to the Agency, subject to such revisions as may be made by the Agency Executive Director or his designee subject to the review and approval of the Agency Attorney, and the Chairman of the Agency is hereby authorized to execute the Loan Agreement and Affordable Housing Agreement on behalf of the Agency and [B] appropriates $4,400,000 from the unappropriated balance in the Low And Moderate-Income Housing Fund for financial assistance to South Bay Community Villas, L.P. for the development and operation of Heritage Town Center. A copy of the Loan Agreement and Affordable Housing Agreement when executed by the Agency shall be placed on file in the Office of the Secretary of the Agency and the City Clerk. Section 5. The City Council finds pursuant to Chula Vista Municipal Code §17.10.070 that the waiver of the Park Fee will stimulate the production of housing for low and moderate-income families. Resolution 2001-401 Page 5 Section 6. The proceedings and all evidence introduced before the Planning Commission at their meeting held on November 14, 2001, and the minutes and resolutions resulting therefi'om, are hereby incorporated into the record of this proceeding. Section 7. The City Council hereby [A] approves a ten-year deferral of the payment of the applicable Public Facilities Development Impact Fee for the 91 senior housing units in the approximate amount of $238,238, a waiver of the Residential Construction Tax in the approximate amount of $73,075, and a waiver of the Park Fee in the approximate amount of $355,466, to assist with reducing the development costs for the construction of the residential units of the Project subject to the Developer dedicating an additional 1.8 acres of land for a future community park and [B] approves the Deferral Agreement in substantially the form presented, subject to such revisions as may be made by the City Manager or his designee subject to the review and approval of the City Attorney, and the Mayor is hereby authorized to execute the Deferral Agreement on behalf of the City. A copy of the Deferral Agreement when executed by the Mayor shall be placed on file in the Office of the City Clerk. Section 8. The Executive Director of the Agency (or his designee) is hereby authorized, on behalf of the Agency, to make revisions to the Loan Agreement and Affordable Housing Agreement which do not materially or substantially increase the Agency's obligations thereunder or materially or substantially change the uses or development permitted on the Site, to sign all documents, to make all approvals and take all actions necessary or appropriate to carry out and implement the Loan Agreement and Affordable Housing Agreement and to administer the Agency's obligations, responsibilities and duties to be performed under the Loan Agreement, Affordable Housing Agreement and related documents. Any such revisions or modifications to the Loan Agreement or the Affordable Housing Agreement are subject to the review and approval of the Agency Attorney. Presented by Approved as to form by Chris S~Tomone v ~A~~.~ Community Development Director Resolution 2001-401 Page 6 PASSED, APPROVED, and ADOPTED by the City Council and the Redevelopment Agency of the City of Chula Vista, California, this 20th day of November, 2001, by the following vote: AYES: Agency/Councilmembers: Davis, Padilla, Rindone, Salas, and Horton NAYS: Agency/Councilmembers: None ABSENT: Agency/Councilmembers: None Shirley H°rt~, Chair/Mayor ATTEST: Susan Bigelow, City Clerk STATE OF CALIFORNIA ) COUNTY OF SAN DIEGO ) CITY OF CHULA VISTA ) I, Susan Bigelow, City Clerk of Chula Vista, California, do hereby certify that the foregoing City Council Resolution No. 2001-401/Redevelopment Agency Resolution No. 1760 was duly passed, approved, and adopted by the City Council and Redevelopment Agency at a regular meeting held on the 20th day of November, 2001. Executed this 20th day of November, 2001. Susan Bigelow, City Clerk