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HomeMy WebLinkAbout2014-02-26 HAC Agenda Packetousin2 Advisory Commission Notice is hereby given that the Housing Advisory Commission of the City of Chula Vista has called and will convene a Special Meeting on Wednesday, February 26, 2014 in Conference Room. C103, located at 276 Fourth Avenue, Building A, Chula Vista, California to consider the item(s) on this agenda, SPECIAL, ME' ETINC OF THE HOUSING ADVISORY COMMISSION OF THE CITY OF CHULA VISTA Wednesday, February 26, 2014 4.00 p.m. CALL TO ORDER Conference Room 0103 276 Fourth Avenue, Building A Chula Vista ROLL CALL: Commissioners Minas, Quero, Tone, Chair Uy, and ulcer CONSENT CALENDAR The BoardlCommission will enact the Consent Calendar staff recommendations by one motion, without discussion, unless a Board/Commission Member, a member of the public, or staff requests that an item be removed for discussion. If you wish to speak on one of these items, please fill out a `Request to Speak" form and submit it to the Secretary prior to the meeting. Items pulled frons the Consent Calendar will be discussed immediatelyfollowing the Consent Calendar. i 1. APPROVAL OF MINUTES FROM November 13, 2013 Staff recommendation: Review Attachment 1 and approve minutes. PUBLIC COMMENTS Persons speaking during Public Comments inza address the BoardlComnaission on any subject matter within the BoardlCommission's jurisdiction that is not listed as an item on the agenda. ,Mate lair, generally prohibits the Board/Cominission froirz discussing or taking action on any issue not included on the agenda, but, if appropriate, the Board/Commission mo}, schedule the topic for future discussion or refer the matter to staff. Comments are limited to three minutes. ACTION ITEMS The .Item (s) listed in Hhis sec?ton of the agenda will be considered -individually by the BoordlCommission and are expected to elicit discussion and deliberation. If you wish to speak on any item, please- fill out a "Request to Speak" form and submit it to the Secreiaiy prior to the meeting. 2. CONSIDERATION OF AN APPLICATION FROM SOUTH BAY COMMUNITY SERVICES FOR 192-196 LANDIS AVENUE Staff recommendation: Review Attachment 2 and provide an advisory recommendation that the City Council conditionally appro),e up to $450,000 of Community Development Block Grant (CDBG) funds for the financing of a proposed 7 -unit permanent supportive residential project. 0TIW1 R Bl[151NESS 3. STAFF COMMENTS 'update on the following projects/programs: ® Lofts on Landis Green Homes for All 4. CHAIR'S COMTvMNTS S. COMMISSIONERS'/BOARD MEMBERS' COMMENTS ADJOURNMENT to the regular meeting on Wednesday, April 23, 2014 in Conference Room. 0101 at 276 Fourth Avenue, Building A, Chula Vista, California. Materials provided to the housing Advisory Commission related to any open-sessionitem on this agenda are available for public revie34i in. the Housing .Division, Chula lrista during normal business hours, In compliance i 4th the AAIEBICANS WITH DISABILITIES ACT The Cite of Chula r"ista requests individuals who require special accommodations to access, attend, and/or participate in a City meeting, activity, or service, contact the Human Resources Department at (619) 69.1-50.41 (California Relay Seri)ice is available for the hearing impaired by dialing 71 T) at least for7y-eight hours in advance of the meeting. ses� t.n� "t', E'r• l..if l: ;" ,>t7i1 ,Ky c"'r, po )—seer.' V:s?('?. 9 am - f �;� ,r '3.: ;',.�:r �.. tiv� ?� .�. � ! -;�: _.a c.. E, F .... ,c.•z.q � 1'�'.�W ", Page 2 1 HAC Agenda February 26, 2014 CITY OF CHULA VISTA DRAFT MINUTES HOUSING ADVISORY COMMISSION SPECIAL MEETING Wednesday, November 13, 2013 4:00 P.M. CALL TO ORDERIR©LL CALL -- 4:02 P.M. PRESENT: Mark Minas, Sergio Quero, Lillian Uy ABSENT: Mauricio Torre (excused) STAFF: Stacey Kurz, Senior Project Coordinator ,Jose Dorado, Project Coordinator Leilani Hines, Housing Manager ATTACHMENT I CITY HALL CONFERENCE ROOM C101 276 FOURTH AVENUE APPLICANT: Colin Rice, Rice and Healing Development Group 1. APPROVAL OF MINUTES e.- 7124113 - Chair Uy motioned to approve the minutes from the meeting of 7124113. Member Minas second the motion and alf members agreed 3-0. 1 2. KIKU GARDENS APARTMENTS (1260 THIRD AVENUE) REHABILITATION Staff Dorado provided a summary of the staff report, Exhibit 1 and brief presentation, Exhibit 2 of the request by the applicant Rice and Healing Development Group for the Housing Authority to issue $12M in tax exempt bonds for the rehabilitation of Kiku Gardens senior affordable rental housing. He further introduced the applicant as being available for questions and Colin Rice added that they anticipate closing in June and taking 6-8 months for the rehabilitation with an anticipated finish in December 2014. Chair Uy asked if any conservation measures/energy upgrades would be included in the rehabilitation and how that would impact tenants rents? The applicant replied that they would be doing energy upgrades including the installation of solar, however utilities are paid by the owner and therefore no financial savings will be seen by residents however they will have a healthier environment. Staff Dorado explained that the complex is a Section 8 Project Based Development and therefore all residents do not pay more than 30% of their income. The development will be restricted by HUD regulations for an additional 55 years through this refinance and the project based Section 8 assistance is locked for an additional 20 years. Chair Uy further inquired about how tenants will be relocated during the i ,rehabilitation. The applicant indicated that -the rehabilitation will be phased, that they did not anticipate any tenant being out of their unit fbr Longer than 4 days. They will be providinG vouchers for hotels or financial stipends if they have other housing preferences and that they were being sensitive to the conditions tenants return to. Vice Chair Quero inquired whether local contractors would be used for the rehabilitation. The applicant indicated that they had a general contractor that would be soliciting local subcontracting. Vice Chair Quero further inquired as to whether any new programming for tenants would be provided and the applicant replied that the existing services such as on-site activities and shuttle services to cultural and shopping venues would continue and the on-site service coordinator would continue to engage tenants. Member Minas inquired as to whether the common areas would also receive a facelift and the applicant replied yes. Member Minas asked staff about a previous development that came before the commission z and had Radon issues that prevented the project from moving forward. Staff Kurz indicated that complex was Sriarpatch and the environmental issue was with the primary lender and not the City funding. He Housing Advisory Commission Minutes 'Page 2 of 2 followed up by asking the applicant if they had completed their due diligence and whether a situation could occur to prevent the project from moving forward and they replied that they had been doing their due diligence and they did not anticipate any issues. Member Minas further asked if tenants have been resistant to the rehabilitation. The applicant indicated that the residents have not been opposed to the rehabilitation and that the owners have been and will continue to meet and involve residents including posting the materials boards with tenants for them to be parlay to the rehabilitation. Chair Uy asked for greater clarification on the common areas and unit rehabilitation. The applicant indicated that the property was built in the mid .1980's and therefore needs a complete facelift including the kitchen and living space common areas which will be one of the first renovated. He added that all units and spaces will be ADA compliant, new art will be added and computers and books to the library. Member Minas motioned to recommend conditional approval of a $12M tax exempt bond for the rehabilitation of Kiku Gardens. Vice Chair Quero second the motion and all members agreed 3-0, 3. RESOLUTION CHANGING THE TIME OF REGULAR MEETINGS Member Minas motioned to approve the Resolution changing the regular meeting time to 4:00 p.m. Vice Chair Quero second the motion and all members agreed 3-0. 4. STAFF REPORTS Project Updates: .,> Lofts on Landis — Staff Kurz indicated that the project received the tax credit financing in late September and is anticipated to submit for building permit in the next few weeks. Groundbreaking will occur in February/March 2014 and should be completed by May 2018, 4+. Congregational Towers — Construction has begun on the rehabilitation project and should be completes in summer 2014. None. 6, ORAL COMMUNICATIONS None, 7. ADJOURNMENT -- HAG Meeting was adjourned at 4:47 p.m. when Chair Uy motioned to adjourn with a second from Vice Chair Quero and all members agreed 3-0, to the next regular meeting of January 22, ' 2013. Recorder, Stacey Kurz <i Fxhibit 1 — Kiku Gardens Staff Report Exhibit 2 — Kiku Gardens Presentation I ATTACHMENT 2 The City of Chula Vista Developrnent Services Housing Division ADVISORYA REPORT TO THE HOUSING Item No. 2 Staff. Tose Dorado, Project Coordinator Development Services Department, Housing Division DATE: February 26, 2014 SUBJECT: 192-196 LANDIS - RECOMMENDATION OF APPROVAL TO THE CITY OF CHULA VISTA CITY COUNCIL TO CONDITIONALLY APPROVE AN AMOUNT NOT TO EXCEED $450,000 FOR THE FINANCING OF A PROPOSED 7 -UNIT PERMANENT SUPPORTIVE RESIDENTAL PROJECT AT 192-196 LANDIS 1, IE�ECONII��EN�ATION That the Housing Advisory Commission recommend APPROVAL to the City of Chula Vista City Council to conditionally approve up to $450,000 for a proposed 7 -unit affordable permanent supportive housing project at 192-196 Landis Avenue. The City of Chula Vista has receivedia request from South Bay Cornmunity Services ("Applicant") to consider financial assistance to support the rehabilitation of a seven (7) affordable housing rental housing development ("the Project) at 192-196 Landis Avenue (Exhibit 1 - Locator Map). The Applicant is preparing applications to the Cooperation for Supportive Dousing, the County of San Diego, Youth Build, and to AHP for additional financial assistance. The applicant has identified a funding gap and is requesting that the City of Chula Vista conditionally approve financial assistance in an amount not to exceed $450,000. The other funding sources will be used to substantially finance the Project. 111. PROJECT DESCRI-PTION The App icant With over 435 units in its portfolio, South Bay Community Services (SBCS) 'has significant experience in developing affordable rental housing. SBCS'm.ost recent development in Chula Vista was Muncey Manor for youth aging out of the foster care system. SBCS is qualified and has demonstrated a desire and commitment to partner with the City in the development of another affordable housing project. In reviewing their qualification and past experience, 10 out of their 12 projects serve homeless clients and demonstrates their ability to successfully complete and manage this type of special needs project. February 26, 2014 192-196 Landis Avenue - Page 2 The Propert�T The site at 192-196 Landis is close to public transit and neighborhood services and facilities, including health facilities and commercial areas due to its close proximity to the Third Avenue Village. The property is on a 4,900 square feet lot located near the corner. of Landis Avenue and E Street in the V-3 (West Village) district of the Urban Core Specific flan (UCSP). Although the site is currently being used as office space for SBCS, the project will convert the use back to residential, to include 7 studio units. The project will be affordable for 55 -years and guarantees the availability of such housing and services for the long term. The Proposal In 2013, the local Regional Continuum of Care Council (RCCC) released a Notice of Funding Availability for Developers who could serve the chronic homeless. One of the requirements of that application was to demonstrate site control and to have a reasonable development budget. If awarded, operation funds would be available, SBCS was notified that its application was successful and would be included in the RCCC's final application to the U.S. Department of Housing and Urban Development. This project will receive the South Bay's fair share of these HUD funds. With the success of the application, SBCS is now securing additional funding sources to complete the rehabilitation needed to convert the office space into seven (7) studio units, Income and Rent Restrictions It is proposed that all 7 -units will be affordable to and restricted for occupancy by extremely low income households. As submitted in the RCCC application, the population to be served is the chronic homeless. The unit breakdown, restrictions and estimated rents are summarized in the table below: This project model assumes continued funding from the Regional Continuum of Care to cover the operations costs. The most restrictive rent and income limits of the applicable funding source is applied for the Project for a period not less than fifty-five (55) years and ensures long term affordability. The income and rent restrictions are to be incorporated into the Affordable Housing Regulatory Agreement, which Nvill be recorded against the property. Compliance with the income and rent restrictions will be subj ect annually to a regulatory audit and certification by all of the funding sources. Compliance with strict property management policies and procedures will ensure that income and rent restrictions will be maintained for the full 55 -Near compliance period. IV. FINANCIAL ASSISTANCE February 26, 2014 192-196 Landis Aveiiue Page 3 Foran of Assistance Financing and development of the Landis Studios project is proposed as a joint private -public partnership. With rents restricted at the 30% AMT affordable levels for the 55 -year time period, the net operating income is insufficient to support a loan large enough to cover all the project costs. SBCS is proposing to obtain ether financing to support the majority of the estimated $1,271,905 million ($181,701 per unit) cost of constructing the project (Exhibit 2 - Proforma). Tine development costs are consistent with significant rehabilitation and conversion proj ects, particularly with the small size of the project. To close the financing gap, SB CS has requested direct financial assistance of$450,000. The City's funds would be used to restrict a117 units. This equates to a per unit subsidy of $75,000. Staff is recommending that the City conditionally approve financial assistance in an amount not to exceed $450,000. Community Development Block Grant funds is the most flexible funding source that can be used to provide financial assistance to this type of special needs project. CDBG funds were also used to finance the Murncey Manor project due to the flexibility of the funding terms and conditions that come along with the use of the these HUD funds. The City's financial assistmice will be subject to obtaining the following: 1. Secure additional funding sources, (2) complete architectural plans (3) submit and receive building permits, and (4) negotiation of satisfactory terms of the Regulatory Agreement and Loan Agreement and the approval of such terms and documents by r: the City Council at a later date. Article V: 4 Article V of the California Constitution (Article 34) requires that voter approval be obtain �ed j before any "state public body" develops, constructs or acquires a "low rent housing project". The City of Chula obtained voter approval on April 11, 1975 and subsequently on November 6, 2006 with the passage of Proposition C, which authorizes the development, construction and acquisition of housing for persons of low-income. With the addition of these 33 -units, this leaves 1,578 units wander the City's current authority to facilitate these activities. V. Exhibits 1. Locator Map 2. proforma EXHIBIT 1 Locator Map SOURCES AND USES OF FUNDS Project Name: Project Address: Number of Units (Studios): Total Square Footage: Sources of Funds CSH Predevelopment Loan HUD C o C Program Y Cit of Chula Vista CDBG 2013-14 y County 9 of San Diego HOME 2014 AHP Funding Total Sources of Funds Uses of Funds Development, Soft Costs Construction Hard Costs Total Uses of Funds Total Sources in Excess of Uses EXHIBIT 2 Landis Studios 192196 Landis Ave. Chula Vista CA 91911 7 4,900 0% interest for 24 months (to be 20,000 paid off by sources be)ow) 272,800 450,000 300,000 249,105 1,274 1,905 205,855 1,066,050 1,271,905 0