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Home My WebLink AboutItem 1 - Attachment 2 - Appendix D 13Ri"'I'" HOUSING ELEMENT 2021-2029 Vista APPENDIX D vimun. 2020 1.0 AT RISK AFFORDABLE HOUSING State law requires that the City identify, analyze, and propose programs to preserve existing multifamily rental units that are eligible to convert to non- low-income housing uses due to termination of subsidy contract, mortgage prepayment, or expiring use restrictions during the next ten years. �f Consistent with State law, this section r identifies publicly assisted housing units in Chula Vista, analyzes their potential to convert to market rate housing uses,and analyzes the cost to preserve or replace those units. 1.1 Publicly Assisted Housing The City maintains programs to provide quality housing affordable to different income groups for a healthy and sustainable community. Local affordable housing funds have been used to assist in providing affordable housing. Table D-1 lists those projects in Chula Vista that are required to be evaluated in the Housing Element.The Development Services Department Housing Division staff monitors tenant and landlord compliance with affordability requirements that stem from the City of Chula Vista's (City) Balanced Communities ("Inclusionary Housing") Policy, Affordable Housing Density Bonus program, and financial support, including bond financing, from the Chula Vista Housing Authority. Two projects are eligible to convert to market-rate units due to expiring affordability restrictions within 10 years and are considered to be "at risk." Park Village Apartments for families and Rolling Hills Garden apartments for seniors will be expiring within the next ten years. At-risk units were developed under a State of California Housing and Community Development Family Page AD-1 CHULAVISTA [) I"'I'" HOUSING ELEMENT 2021-2029 APPENDIX D Demonstration Program,with financial assistance from the City's former Redevelopment Agency, and another under the City's Balanced Communities Policy. .... .... .... .... .... .... .... Table D-1 .... .... .... .... .... .... .... .... Summary of Affordable Housing Developments Development Name Type Affordability Funding Source Restricted Expiration Units Date Park Village Apts Family 6/4/2021 LIHTC/RDA/HCD Family Demonstration 28 Program .... Rolling Hills Ranch Garden Senior 55+ 3/22/2022 Inclusionary 104 Apts Tavera Family 3/11/2033 Inclusionary 10 Village of Escaya Residences Family 9/25/2039 Inclusionary 30 Kingswood Manor Family 9/12/2049 Density Bonus 10 Casa Nueva Vida II Special Needs 11/14/2049 HOME and LOW MOD 12 Villa Serena Apts Senior 55+ 5/1/2051 LIHTC/Bond 131 Trolley Trestle Special Needs 12/7/2054 HOME/RDA 17 Sun rose Apts Family 12/1/2056 LIHTC/Bond 89 Harvest Ridge Apts Senior 55+ 12/1/2056 LIHTC/Bond 179 Brisa del Mar Family 5/12/2058 LIHTC/Bond/RDA/HOME/Joe Serna 105 Rancho Buena Vista Family 10/1/2058 LIHTC/BOND/Inclusionary 149 Teresina Apts Family 4/1/2061 Bond 90 oxford Terrace Apts. Family 11/1/2062 LIHTC/Bond/Project Based Section 8 105 Vouchers Seniors onBroadway Senior 62+ 1/15/2063 LIHTC/HOME 40 The Landings I Family 10/1/2063 LIHTC/Bond/MHP/HOME/Inclusionary 91 Los Vecinos Family 4/13/2064 LIHTC/RDA/Density Bonus 41 Colorado Apts Special Needs 3/30/2065 NSP 2... Glover Apts Special Needs 4/10/2065 NSP ¢... Muncey Manor Special Needs 7/28/2065 CDBG Palomar Apts Family 2/16/2066 LIHTC/Bond 0.... The Landings II Family 6/30/2066 LIHTC/Bond/HOME/RDA/Inclusionary 141 Congregational Tower Senior 62+ 3/13/2068 Bond/LIHTC 184 Garden Villas Apts.... Senior 62+ 6/1/2069 LIHTC/Bond 99 Lofts on Landis Family 1/15/2071 HOME and NSP 31 Trolley TerraceTownhomes Family 1/18/2074 LIHTC/Bond/HOME 17 CordovaApts Family 1/18/2074 LIHTC/Bond 39 Page AD-2 City of Chula Vista General Plan 13Ri"'I" HOUSING ELEMENT 2021-2029 Vista APPENDIX D vimun. 2020 .... .... .... .... .... .... .... Table D-1 .... .... .... .... .... .... .... .... Summary of Affordable Housing Developments Development Name Type Affordability Funding Source Restricted Expiration Units Date St. Regis Apartments Family 6/27/2074 Bond/LIHTC/RDA 118 Duetta Family 12/31/2087 LIHTC/BOND/Inclusionary/HOME/RDA 86 Volta Senior 62+ 12/31/2087 LIHTC/BOND/Inclusionary/RDA 121 Casa Nueva Vida I Family 08/17/2023' 13. Regency Special Needs 11/10/2028' HOME 1.... Concord Special Needs 11/10/2028' HOME and LOW MOD 1.... Dorothy Street Manor Family Perpetuity Public Housing 0 Town Center Manor Senior 62+ Perpetuity Public Housing 0 L Street Manor Family Perpetuity Public Housing 0 Melrose Manor Family Perpetuity Public Housing 0 Source:City of Chula Vista DSD Housing Division(2019) M ■ N 1.2 Resources for Preserving Affordable Units Available public and non-profit organizations with funds available to preserve assisted �r housing developments include San Diego 4 �f County, the City of Chula Vista and its Housing Authority, and various non-profit developers, including Wakeland Housing and Development, �� " .0 Community Housing Works, and Habitat for Humanity. Financial resources available include bond financing, as well as CDBG and HOME '' ' funds, and Balanced Community funds. These options depend on the availability of resources at the time the development is eligible to convert to market-rate. 1 Agreements provides for the extension of the restrictive covenants in additional 5 year increments. ��t11 Page AD-3 CHULAVISTA [)I"I" HOUSING ELEMENT 2021-2029 APPENDIX D Lastly, the State of California Housing and Community Development Department regulates the process that owners of assisted housing developments must follow when units are at risk of converting to market-rate. In accordance with State Law, if an owner of an assisted housing development decides to terminate a subsidy contract, dispose of the assisted housing development, or if the rental restrictions will expire, the owner must first contact an entity that is qualified to preserve at-risk housing and provide a notice of an opportunity for that qualified entity to offer purchase of the property, in an effort to preserve affordability of the property. The State maintains a list of Qualified Entities who are interested in purchasing assisted multifamily housing projects. The current list of Qualified Entities, HCD's current list of Qualified Entities, HPD 00-01 (XLS) , is periodically updated. For more information related to preservation of multifamily affordable housing stock, please visit the HCD's website at https://www.hcd.ca.gov/policy-research/preserving-existing-affordable-housing.shtml. M ■ N 1.3 Preservation Strategies The appropriate preservation options depend largely on the type of project at risk and the type of financing used to make the units affordable. Options to preserve units could involve providing financial incentives to the project owners to extend low-income use restrictions, purchasing affordable housing units by a non-profit or public agency, or providing local subsidies to offset the difference between affordable and market rate. Local Rental Subsidy An option for preserving the 130 units at-risk during the planning period is to provide a local rental subsidy to residents. This method would be utilized to retain the affordability of the units via the provision of assistance to residents when their affordable units convert to market rate. State or local rent subsidies can be utilized to maintain the affordability of these units. Such subsidies can be a in a form of a voucher or payment similar to the Section 8 program. To determine the need subsidy, Fair Market Rates were compared to "affordable rents", as defined by California Health and Safety Code Section 50053. Table D-2 provides an estimate of the required subsidy by unit type. Page AD-4 City of Chula Vista General Plan 13Ri"'I" HOUSING ELEMENT 2021-2029 Vista APPENDIX D vimun. 2020 Table D-2 ESTIMATED LY SUBSIDY TO PRESERVE "AT-RISK" UNITS Unit Size FMR Affordable Difference Number of Monthly Annual Rentz Units Subsidy Subsidy Studio $1,404 $973.00 $431.00 0 $0 $0 1-Bdrm $1,566 $1,112.00 $454.00 96 $43,584 $523,008 2-Bdrms $2,037 $1,251.00 $786.00 27 $21,222 $254,664 3-Bdrms $2,894 $1,390.00 $1,504.00 9 $13,536 $162,432 TOTAL 132 $78,342 $940,104 55 year subsidy $51,705,720 Notes: I Units are assumed as occupied by low income households with affordable rent calculated at 30%of income. Source:HUD Income Limits and FIVIR(2020) M E N 1.4 Replacement Cost Analysis A general rule of thumb suggests that the cost of preserving existing units is more cost effective than replacing units through new construction. Replacement of these units with rehabilitated units may be cost effective in some instances. Based upon information provided by the local development community, brokers and housing developers, replacement costs for multi-family units have been estimated. Construction cost - estimates include all hard and soft cost associated with construction in addition to per '+ , unit land costs. The analysis assumes the replacement units are garden style apartments with parking provided on-site. Square footage R has been estimated as the average unit size per the prevailing sales in the region. Land costs have been determined on a per unit basis. Table D-3 provides a summary of estimated replacement costs per unit. Page AD-5 CHULAVISfA [)RAI"I" HOUSING ELEMENT 2021-2029 APPENDIX D Table D-3 REPLACEMENT COSTS BY UNIT TYPE Unit Size Cost per Square Avg Sq Replacement Number of Total Replacement Foot($)' Ft/Unit Cost per Unit' Units Cost Studio $385 500 $192,500 0 $0 1-Bdrm 1 $385 700 1 $269,500 96 $25,872,000 2-Bdrms $385 900 $346,500 27 $9,355,500 3-Bdrms $385 1,100 $423,500 9 1 $3,811,500 132 $39,039,000 Notes: I Cost Analysis based on average total development cost per unit for projects financed by the Chula Vista Housing Authority during 2019- 2020. Source:City of Chula Vista DSD Housing Division(2020) Page AD-6 City of Chula Vista General Plan