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HomeMy WebLinkAboutcc min 2001/02/20 RDA MINUTES OF AN ADJOURNED REGULAR MEETING OF THE CITY COUNCIL, A REGULAR MEETING OF THE REDEVELOPMENT AGENCY, AND A SPECIAL MEETiNG OF THE HOUSiNG AUTHORITY OF THE CITY OF CHULA VISTA February 20, 2001 6:00 p.m. An Adjourned Regular Meeting of the City Council, a Regular Meeting of the Redevelopment Agency, and a Special Meeting of the Housing Authority of the City of Chula Vista were called to order at 6:16 p.m. in the Council Chambers, located in the Public Services Building, 276 Fourth Avenue, Chula Vista, Califomia. ROLL CALL PRESENT: Agency/Housing Authority/Councilmembers Padilla, Rindone, Salas, and Chair/Mayor Horton ABSENT: Agency/Housing Authority/Councilmembers: None ALSO PRESENT: Executive Director/City Manager Rowlands, Agency/Authority/City Attomey Kaheny, City Clerk Bigelow CONSENT CALENDAR 1. APPROVAL OF M1NUTES OF FEBRUARY 6, 2001 Staff recommendation: The Agency/Council approve the minutes of the Adjourned Regular Meeting of the City Council and Regular Meeting of the Redevelopment Agency of February 6, 2001. 2. AGENCY RESOLUTION NO. 1714, RESOLUTION OF THE REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA AMENDiNG RESOLUTION NO. 1673 REGARDiNG CONDITIONAL APPROVAL OF A RESIDUAL RECEIPTS LOAN FROM THE LOW/MODERATE INCOME HOUSING FUND NOT-TO-EXCEED $1,060,000 TO AVALON COMMUNITIES LLC, FOR THE DEVELOPMENT OF A MIXED USE PROJECT, INCLUDING 106 AFFORDABLE HOUSING UNITS On June 13, 2000, the Agency conditionally approved financial assistance in support of "Main Plaza", a mixed-use residential]commercial project involving 106 affordable units. The developer, Avalon Communities, has requested amendments to the terms and conditions of the proposed Agency loan. (Community Development Director) Staff recommendation: The Agency adopt the resolution. CONSENT CALENDAR (Continued) ACTION: Agency/Anthority/Councilmember Rindone offered the Consent Calendar, headings read, texts waived. The motion carried 4-0-1 on Item #1, with Agency/Authority/Councilmember Salas abstaining, and 5-0 on Item #2. ORAL COMMUNICATIONS There were none. ACTION ITEMS 3. a. HOUSiNG AUTHORITY RESOLUTION REGARDING ITS iNTENTION TO ISSUE TAX EXEMPT OBLIGATIONS FOR A PROPOSED AFFORDABLE SENIOR AND MULTIFAMILY HOUSiNG PROJECT KNOWN AS HERITAGE TOWN CENTER WITHiN THE OTAY RANCH MASTER PLANNED COMMUNITY b. AGENCY RESOLUTION CONDITIONALLY APPROVING FiNANCIAL ASSISTANCE, SUBJECT TO FUTURE APPROPRIATION, IN THE FORM OF A RESIDUAL RECEIPTS LOAN FROM THE LOW AND MODERATE INCOME HOUSING FUND iN AN AMOUNT NOT-TO-EXCEED $4,330,000 TO SOUTH BAY COMMUNITY VILLAS, L.P. FOR THE DEVELOPMENT OF THE PROPOSED 271 UNIT HERITAGE TOWN CENTER The City of Chula Vista received a request from South Bay Community Villas, L.P., a partnership between the Otay Ranch Company and South Bay Community Services, to consider the issuance of tax exempt obligations to finance the development of a 271-unit complex for low and moderate income households, 91 units for seniors and 180 units of multi-family housing, within the Otay Ranch master planned community. The project is to be known as "Heritage Town Center," located on 9.3 acres of vacant land in the Otay Ranch Village 1 tentative map R47 and C1 sites, on East Palomar Street between Santa Rita and Santa Andrea Avenues in Chula Vista. Additionally, the Redevelopment Agency received a request for financial assistance for the project, and the City is being asked to waive certain City fees and to grant additional credits for units based upon affordability levels and large bedroom sizes. (Community Development Director) Community Development Director Salomone presented the proposed Otay Ranch Village 1 affordable housing project, highlighting such areas as Housing Element requirements; concentration issues; west-side mitigation; financing; and affordable housing credits. He discussed the policy issue of whether concentration of the low-income units warranted an off-site mitigation for all or a portion of the proposed units. He stated that the primary objective was to increase low-income housing opportunities within the eastern communities of the City, since those are where projects of over 50 units generally occur. The developer is required to meet fifty percent of its low-income housing obligation and has done so by providing a mix of senior and four-bedroom units. Mr. Salomone explained that (1) moving the units to the western side of the City would provide an Page 2 Council/RDA/Housing Authority Minutes 02/20/2001 ACTION ITEMS (Continued) opportunity to revitalize the Broadway contidor, a Council goal established in 1998; (2) certain development fees on the east side of the City do not occur on the west side, and, therefore, some economies would accrue to the development of low-income units on the western side, particularly with regard to the Trans DIF and 125 DIF fees; (3) there is potential for other opportunities within Otay Ranch holdings to mitigate this obligation, particularly in Building 6, and these obligations could be integrated into a larger project or at a different site and still occur in the eastern part of the City. He asked Council to provide staff with direction to determine the feasibility of alternative proposals, other than the one presented, and to give direction on off-site mitigation in the western part of the City or mitigation in another part of the Ranch. Staff recommends that the current proposal be allowed to proceed for the next funding cycle, however, the developer would prefer that the project either be approved or not approved, since the developer would not want to take the proposal to SDLAC at the state level and then have to turn down tax credit financing. Housing Coordinator Arroyo summarized the proposed project, including the project design and financing. Agency/Housing/Councilmember Salas stated that the City should either commit to the project as it stands or not, rather than approving it for the purpose of submitting a funding application and then later trying to change the project or policy direction. Kathryn Lembo, 315 Fourth Avenue, representing South Bay Community Services, stated that an opportunity exists to offer low-income families the possibility of eventually owning a part of a project. She asked the Council/Agency to consider moving part of the obligation to the west side to benefit those who will live in the units as well as the entire community. She also mentioned that a new school with 600 available seats will open on Broadway and K, and new projects built on the west side of the City will pay school and park fees, so new cooperatives could be designed to accommodate green space and tot lots. Agency/Housing/Councilmember Salas asked if such a cooperative could be built on the east side. Ms. Lembo replied that the issue was cost and that such projects worked better with smaller projects of about 50 units. Agency/Housing/Councilmember Padilla expressed concern that a small percentage of initial tenants would remain long enough to become part owners in a cooperative. He felt there were other ways to assist people with a low- or moderate-income status to attain home ownership. Ms. Lembo explained that in a current project, the ownership percentage during the first 15 years is low because the tax credit investor owns 99% of the project. In year 16, residents would share 90% ownership with South Bay Community Services. She also agreed that a cooperative was not the only way to homeownership and that other benefits, such as living close to the trolley, would be a factor, since many clients who leave transitional housing to move to low-lncome communities do not have vehicles. Agency/Housing/Councilmember Padilla asked whether the geographical location of the units was a legitimate issue of concern. Ms. Lembo replied that clients of South Bay Community Services desire a quality of life for their families that would include ownership, and it may mean living near transportation or in a rural community. Page 3 Council/RDA/Housing Authority Minutes 02/20/2001 ACTION ITEMS (Continued) Agency/Housing/Councilmember Salas expressed concern with the projects' massive size and the density of units that would be concentrated in one area. She stated that a balance of all types of housing needs to be integrated into projects on the east side, as well as on the west side, and developers in other areas have proven that it can be done effectively. Agency/Housing/Councilmember Davis stated that an opportunity to mitigate housing on the west side would be very positive because property values are lower, and new infrastructure, community services and amenities would be provided for residents on the west side. She pointed out that the state is allocating large sums of money for "smart growth" areas, and the state looks at "smart growth" in terms of areas in close proximity to transit lines. The City also needs to encourage higher density in the older parts of the City to revitalize the downtown area. She supported the cooperative concept and pointed out that when the bayfront is developed, property values on the west side of the City will increase tremendously. She suggested that the Council keep its options open and consider mitigation on the west side on a project-by-project basis. Mayor Horton expressed concern with the high number of units located in a small area, which could lead to management problems, and also with parking issues, since many of the units may have two or three cars. She stated that there were existing projects on the west side of the City in need of renovation, and she felt it was Council's responsibility to make the fight planning decision and assist as many families as possible in achieving home ownership. Agency/Housing/Councilmember Salas pointed out that the City's past investments on the west side were starting to pay off; and there is healthy competition among developers competing to build good projects on the west side. She added that it was Council's responsibility not only to replace low-income housing, but also to add new housing to the community. The City also needs to keep its commitment to have a variety of housing, including low to moderate income housing on the east side, and not concentrate it all on the west side. Agency/Housing/Councilmember Padilla stated the Council needs to defend its policy incorporated into the Housing Element adopted only last December of integrating low and moderate-income housing into development on the east side of the City and to proceed with delivering the proposed products to serve families in Chula Vista who need them. He explained that if the Council did not support the proposed project, the developer would face a situation wherein the present financing cycle would be missed, the developer would have to go back to the drawing board to find a way to meet its obligations, which could not be done in time, and then have to be prepared to come up against the City's threshold, which would ultimately bring the development in Otay Ranch to a standstill. Mayor Horton stated that Council did have some flexibility within its own policy, and the Council, at its sole discretion, could make alternative suggestions based on the different unique developments that occur within the community. Page 4 Council/RI)A/Housing Authority Minutes 02/20/2001 ACTION ITEMS (Continued) ACTION: Mayor Horton moved to approve allowing the 91 low income senior units to be built; have the developer be responsible to provide half of the remaining units in the next village or next phase, and allow the remaining number of units to be built on the west side of the City; and to direct Staff to come back with a report that would allow that scenario to happen in the future, with a solid commitment and a timeframe, and the remaining units should be in the two, three, and four bedroom category for families. Agency/Housing/Councilmember Salas stated that she would support the motion only if the units to be developed on the west side would add significantly to the community in terms of social services, cultural activities, and parks. ACTION: Agency/Housing/Councilmember Padilla offered a friendly amendment to the motion that staff be directed to bring back various options and alternatives for Council consideration. Kent Aden, representing the Otay Ranch Company, spoke in support of the motion, but requested clarification that the Otay Ranch Company would still be able to negotiate and bring back, as part of the proposal, some of the density bonus issues that were previously discussed with staff relative to providing the higher bedroom count, and that Council would be recommending some type of relief from the current threshold relative to Otay Ranch Company's present inability with having to defer on submitting the 90 units to SDLAC. Mayor Horton agreed that Council would have to make those adjustments. City Manager Rowlands stated that since a good faith effort had been made by the developer with City staff to solve the issues, staff could waive the August 1st cap. Mr. Aden stated that he was excited about the mixed use project and felt it to be the best project that Otay Ranch had done to-date. Agency/Housing/Councilmember Salas expressed concem about allowing additional building permits and emphasized that one of the flexibilities in the city's housing element was that there must be a finding that new construction within a project creates an unreasonable hardship on the developer. She felt there was too much room for a developer to get out of its obligation, and she wanted stronger assurances that the developer intends to follow through with its obligations on the rest of the villages. Deputy City Attorney Hull stated that staff would work with the developer to secure the future development of the obligations in other villages. Agency/Housing/Councilmember Rindone felt that there were two policy issues to be considered, density and the equitable distribution of housing to the west side. He indicated that he would not support moving the obligations from the east to the west side, and added that the City needs to ensure that opportunities and mixed uses exist throughout the city. ACTION: The motion carried 4-1, with Agency/Housing/Councilmember Rindone opposing. Page 5 Council/RDA/Housing Authority Minutes 02/20/2001 OTHER BUSINESS 4. EXECUTIVE DIRECTOR'S REPORTS There were none. 5. CHAIR/MAYOR REPORTS There were none. 6. AGENCY/AUTHORITY COMMENTS There were none. CLOSED SESSION 7. CONFERENCE WITH REAL PROPERTY NEGOTIATOR - Pursuant to Government Code Section 54956.8 a. Property: Assessor Parcel Nos. 568-270-03; 568-270-11 (approximately 2.85 acres located at the southeast comer of Fourth Avenue and F Street) Negotiating Parties: City Council / Redevelopment Agency (Sid Morris / Chris Salomone) and Chula Vista Center (Robert Caplan) Under Negotiation: Price and terms for acquisition No action was taken. b. Property: Assessor Parcel Nos. 568-270-30; 344 "F" Street (approximately .25 acres located at the southeast comer of Fourth Avenue and Garrett) Negotiating Parties: City Council / Redevelopment Agency (Sid Morris / Chris Salomone) and Park Centre (Richard Zogob) Under Negotiation: Price and terms for acquisition No action was taken. ADJOURNMENT At 8:20 p.m., Mayor Horton adjourned the meeting to the Adjourned Regular Meeting of the Redevelopment Agency on March 6, 2001 at 4:00 p.m., immediately following the City Council meeting. Respectfully submitted, Susan Bigelow, CMC, AAE, City Clerk Page 6 Council/RDA/Housing Authority Minutes 02/20/2001