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HomeMy WebLinkAboutReso 2016-041 ORESOLUTION NO. 2016-041 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA APPROVING AN AGREEMENT WITH BALD\�'IN AND SONS. LLC ("DEVELOPER") FOR THE DEVELOPMENT OF A 100 BED ATHLETE HOUSING PROJECT AT THE OLYMPIC TRAINING CENTER IN SATISFACTION OF A PORTION OF DEVELOPER'S OBLIGATIONS UNDER THE CITY'S BALANCED COMMUNITIES POLICY WHEREAS. in 1981 the City adopted the Balanced Communities ("Inclusionary") Policy of the Housing Element of the General Plan; and WHEREAS. the City's Balanced Communities Policy (Inclusionary Policy) requires 10 percent of any new subdivision in excess of fifty (50) units to be made affordable for low and moderate-income families (5% low and 5% moderate) (the "Affordable Housing Obligation"); and WHEREAS, on September 26. 2012 and December 15. 2015 the City Council adopted Guidelines to Implementing the Balanced Communities Policy (the "Guidelines") which provides for alternative methods to meeting the Affordable Housing Obligation; and o WHEREAS. the `Balanced Communities Affordable Housing Agreement" [Otay Ranch Village 2] by and between the City of Chula Vista and Baldwin R. Sons LLC," (the "Developer") recorded February 1. 2011 as Document No. 2012-0059874 of Official Records of the San Diego County Recorder ("Affordable Housing Agreement"), requires. as a condition to issuance of certain building permits to the land covered by the Otay Ranch, Village 2 Sectional Planning Area (SPA) Plan, an Affordable Housing Regulatory Agreement be entered into between the City and Developer whereby Developer agrees to provide for a specified percentage of the residential units as low income housing and moderate income housing.. Furthermore. Section 5 of the Affordable Housing Agreement and the Guidelines allow for alternative methods of compliance for meeting the Affordable Housing Obligation; and WHEREAS. Developer is proposing, in partial satisfaction of its Affordable Housing Obligations for Otay Ranch Village 2 and Otay Ranch Freeway Commercial ("PA-12"), to develop and construct a 100 bed housing project for student/amateur athletes with fixtures. appliances, meeting rooms, storage lockers, and associated facilities, along with a stand-alone day-user shower, restroom and locker facility (at a to be determined location at the OTC), and attendant landscaping (collectively, the "Project") at a different site and to be located at the Olympic Training Center (OTC); and WHEREAS. the City has reviewed the Developer's request to build an off-site housing project at the Olympic Training Center and determined the Project is consistent with the terms of the City's adopted Balance Communities Policy, its Guidelines, and the Developer's Affordable Housing Agreement_; and O Resolution No. 2016-041 Page No. 2 WHEREAS; the Project will provide housing to meet the special needs of national level student/amateur athletes, who in pursuit of their athletic careers, are typically only employed part time and in need of more affordable housing; and WHEREAS, with limited housing opportunities available at the OTC, athletes seek affordable housing within the community and often times in distant areas due to the lack of such choices within closer proximity; and WHEREAS, the location of the Project at the OTC will provide athletes affordable and appropriate housing and immediate access to the OTC facility and its training amenities; and WHEREAS, the OTC provides a valuable asset and an economic driver to the City and the Chula Vista community will benefit from the increased capacity of the OTC, as a result of the additional beds and the day-visit facilities, and enhancement of the long-term feasibility of the OTC; and WHEREAS, the Project offers greater feasibility and/or cost effectiveness by delivering a 100-bed unit housing facility by the summer 2017, well in advance of the requirements of the existing Affordable Housing Agreement where fulfillment of the affordable housing obligation is not anticipated until 2021 based upon market demand and the building permit thresholds; and WHEREAS, affordable housing is typically financed leveraging multifamily housing revenue bonds issued by the City's Housing Authority, Low Income Housing Tax Credits, other Federal or State of California financing programs, and financial assistance by the City, with ' ownership of the housing maintained by the Developer; and WHEREAS, greater feasibility and cost effectiveness is achieved for this Project as the Developer is solely responsible for financing the development costs, with ownership of the Project by the City of Chula Vista and Developer forgoing any financial benefit of retaining ownership in a real estate asset; and WHEREAS, the City, therefore, finds that the Project advances and is consistent with the specific goals and objectives of the Housing Element, Inclusionary Policy, and Guidelines in providing for housing to meet the special needs of national level student/amateur athletes and provides a more effective and feasible means of satisfying the requirements for affordable housing within Otay Ranch Village 2 and PA 12 and greater public benefit; and WHEREAS, in accordance with California Environmental Quality Act (CEQA), the Director of Development Services has determined that the project was adequately covered in previously adopted/certified Final Environmental Impact Report (EIR 89-11) for the Olympic Training Center Sectional Planning Area (SPA) Plan and no further action by the City Council is necessary. Resolution No. 2016-041 Page No. 3 • NOW. THEREFORE, BE IT RESOLVED by the City Council of the City of Chula Vista that this Council does hereby approve the development and construction of a 100 bed housing project for student/amateur athletes with fixtures, appliances, meeting rooms, storage lockers, and associated facilities, alone with a stand-alone day-user shower, restroom and locker facility (at a to be determined site on the OTC), and attendant landscaping (collectively, the "Project") to be located at the Olympic Training. Center (OTC) in partial satisfaction of Baldwin and Sons, LLC's Affordable Housing Obligations for Otay Ranch Village 2 and PA 12. BE IT FURTHER RESOLVED that the City Council of the City of Chula Vista finds, based upon the recitals in this Resolution and the evidence presented at the meeting of the City Council by staff and the public, that the public benefit, feasibility and cost effectiveness of providing the Project at the Olympic Training Center outweighs, when balanced against, the need for providing all of the required affordable housing for low income persons or households within Otay Ranch Village 2 and PA 12. BE IT FURTHER RESOLVED by the City Council of the City of Chula Vista, that it • directs and authorizes the City Manager, or their designee, to prepare all necessary documents and any actions, as may be required for the development and construction of the Project and authorizing the City Manager, or their designee, to execute a Housing Development Agreement and all other associated documents, consistent with the terms reviewed by the City Attorney's office and satisfactory to the City that outlines the Developer's Obligations to deliver the Project O in order to receive credits to offset existing Affordable Housing Obligations in Otay Ranch Village 2 and PA 12 and at a minimum and in substantial form subject to the terms and conditions set forth in the attendant Term Sheet, which is on file with the City Clerk's Office as Exhibit 1 to this Resolution, with such minor modifications, as may be recommended or approved by City Manager and the City Attorney's Office. 144.4)./44..)/gsa. Presented by Appro d as to form by Kelly . roughton, FASLA Glen R. G4ogihs )\\(.4 Director of Development Services Gits-A omey O Resolution No. 2016-041 Page No. 4 PASSED, APPROVED, and ADOPTED by the City Council of the City of Chula Vista California, this 8th day of March 2016 by the following vote: AYES: Councilmembers: Aguilar, Bensoussan, McCann, and Salas NAYS: Councilmembers: None ABSENT: Councilmembers: Miesen Sai J5,41Y Mary as, Mayor ATTEST: SA-- L4A,Ii;) Donna R. Norris, CM C, Cit y Clerk STATE OF CALIFORNIA ) COUNTY OF SAN DIEGO ) CITY OF CHULA VISTA ) 1, Donna R. Norris, City Clerk of Chula Vista, California, do hereby certify that the foregoing Resolution No. 2016-041 was duly passed, approved, and adopted by the City Council at a regular meeting of the Chula Vista City Council held on the 8th day of March 2016. Executed this 8th day of March 2016. J. :_ w Donna R. Norris, CM , ity Clerk Resolution No. 2016-041 Page No. 5 • ATTACHMENT 1 Affordable Housing Agreement Term Sheet [Otay Ranch Village 2] For Negotiation Purposes Only March 3,2016 The following terms are proposed: 1. Parties 1.1 Baldwin & Sons LLC("Developer") 1.2 City of Chula Vista, a chartered municipal corporation("City") 2. Definitions 2.1 Property. That certain property located at the Chula Vista Olympic Training Center(`OTC")as shown on the attached Exhibit A. 2.2 Project. 100 bed athlete housing project with fixtures, appliances, meeting rooms, storage lockers, and associated facilities, along with a stand-alone day-user ® shower, restroom and locker facility(at a to be determined location at the OTC), and attendant landscaping (collectively, the "Project"), as generally shown in attached Exhibit B. 2.3 Developer's Existing Affordable Housing Obligation. Based on the maximum "build-out," Developer's current inclusionary housing obligations are estimated to be as follows: (1) Village 2 consists of 165 Low Income units and 172 Moderate Income units and (2) PA 12 consists of 30 Low Income Units and 30 Moderate Income Units, totaling 195 Low Income and 202 Moderate Income Units. 3. City Provision to Developer of Affordable Housing Credits. 3.1 Affordable Housing Credits. Upon completion of the Project as provided in Section d. below, Developer shall receive credit against Developer's Existing .Affordable Housing Obligations, described in Section 2.3. as follows: 100 Low Income Housing Units(the"OTC Housing Credit"). 3.2 Developer's Residual Affordable Housing Obligation. After offsetting the OTC Housing Credit against Developer's Existing Affordable Housing Obligation, Developer shall still be obligated to provide or pay in-lieu fees for 95 Low Income Housing Units and 202 Moderate Income Housing Units (the "Residual Affordable Housing Obligation"). Developer shall be obligated to satisfy its Residual .Affordable Housing Obligation in accordance with the triggers and otherwise consistent with the terms of the previously executed inclusionary housing agreement for Village 2. Such . 1 Resolution No. 2016-041 Paee No. 6 - obligation shall be secured by a recorded covenant with respect to Village 2, on a parcel (to be identified) reasonably approved by City and adequate to support the development of housing units equivalent to the Residual Affordable Housing Obligation. 3.3 Additional Requirement. The City's approval of the Project and credit towards the Developer's Affordable Housing Obligation is based upon the assumptions and information presented by the Developer and filed with the Affordable Housing Review Application for the Project as submitted and reviewed by the City's Development Services Housing Division. it is expected that any substantive revisions in such assumptions and information which would lead to a material change in the Project (for example, material changes in amenities, unit count, or development costs), may therefore proportionally reduce or increase the level of credit towards Developer's existing Affordable Housing Obligations. 4. Developer's Provision to City of OTC Affordable Housing Project. 4.1 Developer shall obtain all required City permits, construct and deliver the Project to City fully ready for occupancy and use by OTC athletes by on or before July 1, 2017. City agrees to work with developer to expedite the Project permitting process in order to achieve this Project delivery date. Developer shall secure all financing necessary for the development and construction of the Project, including payment of any applicable City building fees and a proportionate amount of the development component of the City's PAD fee. The completion of the Project shall also be secured by Developer to the satisfaction of the City. 4.2 Developer shall diligently pursue and exercise its best efforts to complete the Project by July 1, 2017. Developer shall agree to terms that secure and ensure timely completion of the Project, including, in substantial form, the following: "In order to ensure that the Developer can timely complete the Project, Developer shall submit its design building plans for review by the City in order to allow for issuance of the Project building permits by July 1, 2016. Provided the timely submission of the aforementioned design documents by Developer and timely issuance of building permits by the City as stated herein, the following shall apply: If the Project is not delivered on or before July 1, 2017, Developer's credits will be reduced five (5) credits each month (including partial months) and until full Project delivery occurs, but the total credit loss shall not exceed twenty (25) credits. Once the loss of 25 credits has occurred, then Developer shall provide 100 off-site and ready for occupancy beds within a file mile radius of the OTC ("Off-Site Beds") for OTC resident athlete use until the Project is delivered to the City. Developer may also, in lieu of a loss of credits, opt to provide the Off-Site Beds for the period after July 1,2017 until the Project is delivered to the City. 4.3 Developer will construct the Project using high quality designs and materials approved in advance by City. The Project will be owned and operated by City. Upon 7 Resolution No. 2016-041 Pale No. 7 • transfer to the Cir". Developer shall have no further responsibility for the operation or the maintenance thereof, provided however, Developer shall provide warranties consistent with City requirements or practices for City facilities, including "Bumper to Bumper" and patent/latent construction defect warranties. The completed project shall be free of any encumbrances, liens or any outstanding costs or debts arising from or related to the Project. 4.4 The City and Developer will work together and use their reasonable and good faith efforts to ensure timely completion of the Project. The City and Developer shall also meet and confer to establish protocols to ensure that impacts of construction of the Project to OTC operations, including OTC resident's training, are minimized as much as reasonably possible. 4.5 In the event the City and OTC agreement is terminated, the Project may be terminated by the City. In this case. the City and Developer shall meet to reach mutual agreement to provide Developer a pro-rated inclusionary housing credit for work they have completed on the Project and, if appropriate, provide additional time for developer to implement its residual affordable housing obligations. Developer shall also undertake steps to ensure the Project is secured and rendered safe should it not be completed. • 110 3 Resolution No. 2016-041 Page No. 8 - • EXHIBIT A Property Description Location • Exhibit Resolution No. 2016-041 Pace No 9 • ___..,', .r- .. .e j C�Yr�. ix�-• c' ;"'�- s,fs s �r-i' fFS �1 { y -.f .sy-• a =� .::.1C-‘114 ". 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