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HomeMy WebLinkAboutPlanning Comm Reports/1994/08/24 (5) City Planning Connnission Agenda Item for Meeting of August 24, 1994 2. PUBLIC HEARING: GPA-90-9(A): Consideration of State-mandated Revisions to the 1991 Housinl! Element of the Citv General Plan-- Chanter 1451. Statutes of 1989. Relatinl! to the Preservation of Subsidized Housinl! At Risk of Conversion. A. BACKGROUND On May 15, 1992, the State Department of Housing and Community Development (HCD) issued a letter finding the City's adopted Housing Element update in compliance with the State Housing Element Law. That same letter noted, however, that select portions of the Element would soon lapse from compliance given changes in the State Housing Element Law which were to become effective on July I, 1992. Those changes regard the preservation of existing subsidized low- income housing units which could be converted to non-low-income use. Staff of the Community Development and Planning Departments subsequently worked with HCD in the preparation and review of proposed revisions (please see Exhibit A). As a result, on September 25, 1992, HCD issued a letter indicating that the proposed amendments were found to be in compliance with the revised State law. As a matter of procedure pursuant to Section 65585 of the State Government Code, it is now necessary for the City to formally adopt the amendments as part of the Housing Element, and to subsequently forward the adopted amended Element to HCD. The Environmental Review Coordinator has determined that the proposed amendments will not have a significant impact upon the environment, and has issued an Addendum to Negative Declaration 1S-92-08 (please see Exhibit B). B. RECOMMENDATION: That the Planning Commission; 1. Consider the Negative Declaration (lS-92-08) and Addendum thereto (IS-92-08A), attached as Exhibit B; and, 2. Adopt Resolution GPA-90-09(A) reconnnending that the City Council approve and adopt the proposed amendments to the Housing Element of 1991 in accordance with the attached draft City Council resolution and the findings contained therein. City Planning Commission Agenda Item for Meeting of August 24, 1994 Page 2 C. DISCUSSION 1. Revisions to State Housing Element Law. Preservation of "At-Risk" Housing Units - Background Amendments in State Housing Element law brought about by Chapter 1451, Statutes of 1989, now require all housing elements to include additional needs analyses and programs to address the potential conversion of existing assisted housing developments to non-low-income uses during the next ten year period (Gov. Code Sections 65583 (a)(8) and (c)(6)). These expanded analyses and programs are required as of July I, 1992. The need for such efforts arises largely from the Federal Housing and Urban Development (HUD) Section 236 program conceived in 1968. The Section 236 program provided mortgage insurance and mortgage interest reduction to for- profit and non-profit developers who agreed to build low-income affordable units for families. Typically, the contracts for such projects included a 40 year mortgage which, in the case of for-profit developers, could be prepaid after 20 years. If such prepayment occurred, the project would no longer have the affordability requirement. As a result of not considering the potential consequences of such a prepayment option, in 1987 HUD found the nation facing a serious threat to its available stock of affordable housing. Congress subsequently passed the Emergency Low-Income Housing Preservation Act (ELIHPA), which precluded any prepayment until new permanent legislation was in place. In 1990, the permanent Low-Income Housing Preservation and Resident Homeownership Act (LIHPRHA) was passed. Consistent with the provisions of LIHPRHA, the State promulgated amendments to the State Housing Element Law requiring local jurisdictions housing elements to include needs analyses and programs to identify and plan for the preservation of these units at- risk of conversion to non-low-income affordability. 2. Proposed Amendments to the Chula Vista Housing Element of 1991 As noted in the Background section of this report, City staff has completed amendments to select sections in Part 2 and 3 of the General Plan Housing Element of 1991 as necessary to comply with the changes in State law. Those amendments (attached as Exhibit A) reflect a quantification and expanded analysis of existing local low-income affordable housing developments at such risk of conversion, along with suggested programs/efforts such as the utilization of Redevelopment Agency Set-Aside Housing Funds and Connnunity Development Block Grant Funds for rent subsidies, non-profit predevelopment costs, and City Planning Connnission Agenda Item for Meeting of August 24, 1994 Page 3 acquisition loans to preserve their affordability. The revisions are indicated in strike/underline format, with the proposed new text being underlined. Since an analysis and discussion of at-risk housing units had been included with the draft Housing Element of 1991 as originally reviewed and approved by HCD in May, 1992, the amendments requested by HCD to comply with the changed law essentially amount to an enhancement of the existing analysis and discussion. The more specific nature of the proposed amendments is sunnnarized as follows: For Part 2 (pages with II-# formaO- corrects the number of complexes and units involved. adds the complex's ages, and correspondingly denotes their rehabilitation needs. generally identifies potential funding sources to assist in preservation, and the likelihood of their availability. expands discussions to address the contract expiration conditions for select complexes, and to identify the estimated level of costs to retain affordability. For Part 3 (pages with III-# formaO- corrects quantified assistance objectives based on the revised number of units involved. presents more specific implementing actions / proposals for the preservation of those units most likely at risk of conversion to non-10w- income affordability over the 10 year period from 1991 - 2001. In overview, 8 projects involving 572 potentially at-risk units have been identified and addressed by the proposed amendments. 386 of those are focused upon for action over the next several years, as they are most likely at risk of conversion. In that regard, the Connnunity Development Department has been actively involved with the owners, local non-profit entities, and other resources to ensure the retention of those units. All totaled, the 572 potentially at risk units comprise a substantial amount of the City's existing low-income affordable housing stock. Also, as previously noted, these amendments have already been initially reviewed by State HCD, and found to satisfy the revised State law. The present proceedings are therefore, mainly a matter of procedure to formally incorporate the amendments into the City's Housing Element to obtain full legal compliance. City Planning Connnission Agenda Item for Meeting of August 24, 1994 Page 4 3. Timing for Adoption of the Proposed Amendments On August 3, 1994, the City received notification from State HCD of the availability of substantial housing assistance monies through the BEGIN Program. The BEGIN Program is an off-shoot of the Federal HOME Program of 1990, and provides funds to cities and counties for use as assistance for low-income first- time homebuyers. This assistance can be in the form of downpayment, closing cost and! or second mortgage assistance. Staff is currently in the process of preparing an application package to meet the State's September 9, 1994 filing deadline. One of the critical filing requirements is full legal compliance status for the City's Housing Element. As previously noted, local adoption of the proposed amendments, and subsequent re-filing of the amended Housing Element with HCD is necessary to obtain full compliance status. Staff has been in contact with key personnel at HCD, and has been assured that completion of local adoption hearings on the amendments by the Planning Connnission and City Council before the September 9, 1994 deadline will facilitate acceptance of the City's BEGIN application filing. A subsequent public hearing on the proposed amendments before the City Council has been scheduled for September 6, 1994, thereby allowing the City to meet with HCD's September 9, 1994 filing requirements. (M :\SHARED\HE-AM-PC .RPT) EXHIBIT A Ol'lrr- B.7 Student Poculation Chula Vista is the location of one community college named Southwestern College with an enrollment of approximately 9,602. The college director indicated that in times of recession, full and part-time enrollment is expected to increase as adults re-enter school to enhance employment skills needed in the work force. While most of these community college students commute from outside the area, some do compete for local housing along with other low-income groups. C. AT-RISK HOUSING There are three types of hous i ng potent i ally at ri sk of converting to market type rentals between 1991 and 2001 as shown in the following table: Potential At-Risk Housino Family Units - HUD 236 Family Non-236 Units Elderly Non-236 Units C.l Family Units - HUD 236 Contracts ~~~ 572 total units 386 units .IJi3 154 units 32 units The following table illustrates the required information for the City's HUD Section 236 units: a. Castle Park Garden Apartments 272 Kennedy Street Chula Vista, CA 91911 62 non-elderly, low income units Earliest Date of Conversion: December 1991 Aoe: 21 vears ~P~pJtJp~I//~~fl/~ppp Rehabilitation Needs: Minor b. Oxford Terrace Apartments 555 Oxford Street Chula Vista, . CA 91911 132 non-elderly, low-income units Earliest Date of Conversion: March 1993 (Owner may begin LIHPRHA process 18 months before the project's 20th birthday) Aoe: 19 years ~P~pJtJp~I//~~fl/~ppp Rehabilitation Needs: Minor c. Palomar Apartments 171 Palomar Chula Vista, CA 91911 168 non-elderly, low-income units Earliest Date of Conversion: March 1993 (Owner may begin LIHPRHA process 18 months before the project's 20th birthday) Aoe: 19 years ~P~pJtJp~I//~~fl/~ppp Rehabilitation Needs: Minor 11-18 d. Rancho Vista Apartments 1419 Tobias Drive Chula Vista, CA 91910 24 non-elderly, low-income units Earliest Date of Conversion: November 1991 AGe: 21 years ~p~pjtjp~III~~ftJ Rehabilitation Needs: Moderate Inlg68, HUD developed the 236 program that provided both mortgage insurance and mortgage interest reduction. to any for-profit or non-profit developer who agreed to build affordable housing units for families. Typically, the contracts for these projects included a 40 year mortgage which could be prepaid after 20 years, and if prepayment occurs, then the project no longer has an affordabil ity requirement. This prepayment opt i on only app 1 i ed to for-profi t developers. Unfortunately,. HUD did not consider the consequences of this prepayment option, and as a result, the nation now faces a serious threat to its available stock of affordable housing. In 1987, this threat was brought to the attention of the federal government, and Congress passed the Emergency Low-Income Housing Preservation Act (ELIHPA). This Act prec 1 uded any prepayment unt i 1 February of 1990, and in February, the Act was extended until new permanent legislation could be adopted. In 1990, the National Affordable Housing Act was passed, and this Act included the Low-Income Housing Preservation and Resident Homeownership Act (LIHPRHA). LIHPRHA will provide a permanent solution to the preservation problem if it is adequately funded. Chula Vista has four projects which were HUD financed using the 236 program. Currently, two of these projects have filed a Notice of Intent which states that they intend to prepay their mortgages, In real ity, these projects probably will not be able to prepay since both ELIHPA and LIHPRHA have strict requirements for prepayment. Under LIHPRHA, these property owners can elect to proceed under ELIHPA or LIHPRHA. Nonetheless, both 'acts require an owner to prove that termination of the affordable units will not materially increase economic hardship for current tenants (which generally means annual rent increases of less than 10%); will not involuntarily displace current tenants; or will not adversely affect affordable housing opportunities for low-income and very low-income families, including those families seeking employment in the area, and minorities. Both ELIHPA and LIHPRHA state that these units should be acquired by either a non-profit or a publ ic agency whenever possible. Undoubtedly, the acquisition costs of these units will be high. Nonetheless, both laws provide acquisition incentives to non-profits and public agencies, but LIHPRHA mandates that the following incentives be given: (1) insurance for financing up to 95 percent of the preservation equity (equity as determined by HUD) under the HUD Section 241(f} 11-19 program; (2) grants up to the present value of the total of the projected publ ished Fair Market Rents for Section 8 Existing Housing for the next 10 years (or longer, if necessary); (3) reimbursement for transaction expenses relating to acquisition, such as ordinary transaction costs, financing fees and operati ng defi c i t coverage, Subject to appropri at ions, LIHPRHA also states that HUD must provide assistance sufficient to enable acquisition at a purchase price not greater than the HUD defined preservation value, to pay the debt service of the mortgage and debt service on any rehabil itation loan,. to meet project operating expenses and adequate reserves, and to receive an adequate return on any cash investment made to acquire the project. The approximate cost of acquisition for all four complexes is $26 million. This figure was determined by using the Section 8 Fair Market Rents and a gross rent multiplier of 8. These "at-risk" projects should be preserved, whenever possible, since it would be impossible for the City to replace these lost units. The City has already received the notice to prepay from two owners, and the other two projects can fi 1 e their notices in March of 1991. The owners of these builders are receiving very small rents since the average rent for a two bedroom apartment is $292, and for the most part, they have burned their tax depreciation benefits. Therefore, it is very likely that they may attempt to sellar prepay. To date, the City has identified the following resources which could be utilized for the preservation of these HUD Section 236 un it s: a. Redevelopment Agency Housing Set-Aside Funds: $200.000: and, b. Community Development Block Grant Fundsj~ Approximately $500,000 is available, but the City traditionally uses CDBG funds for publ ic improvements in low and moderate income neiqhborhoods, Therefore. it is unlikelv CDBG funds could be made available. The Agency~ ~ftt $200,000 ~~J~~ could be leveraged in a bond issue to produce $2,000,000. 1 f a bond issue is accomplished, the Agency would have sufficient funds to provide a loan to a non - profit for predeve 1 opment and equ ity since the estimated cost, to the Agency, of preservation is $1,300,000. The cost of preservation is significantly less than the cost of replacement since this cost is estimated to be $40,530,000. In the past 12 months, City staff has identified the following non-profits which could assist with the preservation of the City's HUD Section 236 projects: a. Chicano Federation; b. Civic Center Barrio; c, Interfaith Housing; d. MAAC Project; and, e. South Bay Community Services, 11-20 C.2 Non-236 HousinQ Units At-Risk In addition to the HUD Section 235 Projects, the City has three apartment projects which are at-risk because of expiring use restrictions. These projects are as follows; a. Beacon Cove Apartments 535 East H Street ~ Chula Vista, CA 91910 < 33 non-elderly, low-income units Earliest Date of Conversion: 1995 AQe: 5 vears Type of Government Ass i stance Received: Fulfi llment of the City's Affordable Housing Obligation for the Terra Nova Subdivision b. Eucalyptus Grove Apartments 67 East Flower Street Chula Vista, CA 91910 75 non-elderly, low-income units Earliest Date of Conversion: 1995 AQe: 7 vears Type of Government Assistance Received: Density Bonus & Multifamily Housing Revenue Bonds c. The Meadows of Chula Vista 1055 Granjas Road Chula Vista, CA 91911 32 elderly, low-income units Earliest Date of Conversion: 2000 AQe: 7 vears Type of Government Assistance Received: Density Bonus ~ Terra Nova Villas 440 East H Street Chula Vista, CA 91910 45 non-elderlv. low-income units AQe: 7 vears Earliest Date of Conversion: 1995 Tvpe of Government Assistance Received: HousinQ Revenue Bonds Multi -familv The estimated cost of replacing these units is ~J~'~J~'~~~ $19,809,000. To date, the City has identified the following resources which could be utilized for the preservation of these units: a. Redeve 1 opment Agency Hou sing Set As i de Funds; $200,000; and, b. Community Development Block Grant Funds. Approximately $500,000 is available, but the City traditionally uses CDBG funds for publ ic improvements in low and moderate income neiqhborhoods. Therefore. it is unlikelv CDBG could be made available. 11-21 In order to preserve the family units in Be~con Cove, the only viable alternative is rent subsidies Slnce the existing contract specifically states that restrictions will terminate ten years after the contract was executed. The rent subsidies would provide, for the number of units currently restricted, the di fference between what the owners are allowed to charge which is currently market rate and what market rate may eventually be. Estimating the cost of rental subsidies is extremely difficult since the City has no way of determi n I ng how much and when rents will Increase. Therefore, estimating the cost of preserving these units is nearly impossible. However. if an assumption is made that market rate rents increase by 4% each year for th I rt y years and the count y med i an income does not Increase, the Aqency would need approximately $315.000 to provide rental subsidies. Accordinq to the cooperation aqreement between the City and the owner, the owner is allowed to charqe a rental rate no qreater than 1/12th of 30% of 80% of Count y med I an income, Therefore, if the med I an income increased at the same rate as the increase for market rents. the restricted rents would continue to mirror market rents and no subsidies would be needed. Since the Agency has 1 imited funds and th is fund i ng has been comml t ted to preserYi ng the City's HUD Section 236 units and the Agency's very viable rehabil itation program, the Agency would only have approximately '~~j~~~ $25,000 to 'I'Ir/r;(r!.//,6/1 allocate for rent subsidies, The City will continue to monitor compliance with the City'S Cooperat i on Aqreement wh i ch requ i res the owner to provide units to low income households. As the year of convers i on approaches, the Aqencv wi 11 discuss the pos sibil it y of providinq rental subsidies or other incentives which could preserve the units. The Agency is currently investigating the possibility of refinancing the bonds for Eucalyptus Grove, and if this occurs, the Agency will require extended rental restrictions. With this alternative~ the Agency will incur no costs. Durinq the refundinq of the bond issue for Terra Nova Villas. an extension of the oriqinal requlatorv aqreement was attempted. However, due to the current lendinq environment. the extension was not possible. Currentlv, a non-profit corporation is attemptinq to acquire these units. If this transaction occurs, these units may continue to be affordable. If the non-profit does not acquire these family units. the City will attempt to work with the owner to extend the affordabillty restrictions by determininq an alternative form of credit enhancement. The Letter of Credit for the bonds will expire on March 1. 1995. With this alternative, the Aqency will incur some staff costs, but the costs will be minimal, Senior projects built were typically built under the density bonus program, and they are 1 ess 1 i kely to convert to market rents due to the Conditional Use Permits under which they 11-22 operate. In order to convert, the owner would have to underwrite a considerable expense to bring the senior projects into code compliance mainly for parking requirements. For these reasons, it is unlikely that The Meadows will convert. The following non-profit corporations could assist with the preservation of the above listed unitsi a. .. Chicano Federation; b. . Civic Center Barrio; c. Interfaith Housing; d. MAAC Project; and, e. South Bay Community Services. Since the cooperation agreements ~Jt~ for Eucalyptus Grove and Beacon Cove allow rents which are currently prevailing market rates, the real impact of losing these units is minimal. When the cooperation agreements were written, the med i an income for the San Di ego Standard Metropolitan Statistical Area was much less, and the rent restrictions were considerable. D. PROJECTED NEEDS 0.1 Introduction/Current Estimates Since the beginning of the last Element's planning period in 1985, the San Di ego Reg i on has experi enced fa i rly rapi d and consistent population growth at an average of 3.6% per year, coupled with an average growth in the number of housing units of 3.7% as illustrated in Table 11. By comparison, Chula Vista has generally para 11 e 1 ed the reg i on with average growth rates for population and housing over the 5 year period being 0.1% higher than regional rates. Tables 9 and 10 provide the actual numerical growth in establishing the current population and housing totals for 1990. The figures in parenthesis under"% increase" represent the actual growth percentage without influence from the Montgomery Annexation in late 1985. (continuation of existinG Element text) 11-23 . QUANTIFIED ASSISTANCE OBJECTIVES 1991-96 COMPREHENSIVE HOUSING PLAN Objectives I. 2. and 3 - New Construction Total Units: 1339 Very Low 80 75 40 50 - 245 units Public Housing Units (County Housing Authority) Senior Housing Units (Section 202) Non-Profit Family Housing Units Family Relocation Housing Units Low - 628 units 63 Family Density Bonus 50 Senior Density Bonus 29 Family Non-Profit 358 Affordable Housing Program (Mandatory) 79 Affordable Housing Program (Incentives) 50 Family Relocation Housing Moderate - 131 units 131 Market Rate for Sale and Rental Units Other - 335 units 335 Market Rate for Sale and Rental Units Objective 3 - Opportunities for Very Low-Income Renters Total Units: 500 200 New Section 8 (Certificates and Vouchers) 300 Shared Housing Program (Seniors) Obiective 5 - Rehabilitation and Conservation Total Units: 7~~ 683 ~~~ 386 At Risk Low-Income Units (Section 236 Family) 32 Non-236 Senior Housinq Units 200 Single Family and Mobilehome Rehab (CHIP) (180 very low income, 20 low income) 65 Rental Rehabil itation Obiective 6 - Transitional Housinq Total Units: 20 Very Low-Income (New construction or rehab) 111-2 O/~:5 ;9. ~._- OBJECTIVE 5 The systematic renewal, rehabilitation, conservation, and improvement of the residential neighborhoods of the Chula Vista Planning Area. Policy 1. The City shall address the development of mechani sms designed to prevent at-risk affordable units from conversion to market rate rents. 2, The City will continue to initiate pro-active programs for neighborhood revital ization and improvement, and to supply support funding for these efforts, especially in neighborhoods with higher concentrations of lower-income households. 3. The City shall continue to advocate conservation measures to preserve existing housing stock, variety, and affordability. ImDlementinQ Actions A. Pf~~~f!~ Preservation of At-Risk Affordable Housing Units A.1 HUD Section 236 Units 1~~//AlYVV//~///7~~//~ft~//~pptft~~///VifYti//~//~f~ p~t~~tJftJJI/!Y~~Y~Y/~ptftfi~//~v/t0~~/p~rrp~/~/t~~ pt~p~ttl//~~~~tt//~ft!~//pt~Pftl~~~t//~ptJ~~t//J~//t~~Jt//~~ttgftg~ ~~~tf~~ttl///$J~~~//~~~gf~tt//Pfttt~~//t~~//~~~fg~~~I//~p~/I~~p~~ ~~~tJ~g/y~/~~t/!0i/J~~7//~JYY/~~~/~/~~~/I~~p~~ ~~~tJ~g//VvvivvV~rY~if/~/~tfi~4fi~//~p~~p~~~rt~rp/fiYvv/Af//J~~~ l~J~P~~~Jj/t~~/JJ~~lJ~~~~/~'/pt~Pftl~~~t/~ftt/~~~~/t~~~~~~I ~~~~t/~/'~~~tftJ/~//t~~/~/~~~/!v.I/J~t~f~tt~~/!0i/t~~ pf~Pft/~~~t//~Y~/tAtV/r~K~/~/pf//~v/fi~At.I/t~~t ~~t~/ #NWA! Nr.~/ ,ufIPNW NnW / ~N NrlrNYrN / N tI7W~ /f##~ ~~~/I~t/~ftJ~tftJ~/ft"~t~ft~JJJtll $~~~/~~A&//p~r.~ri/~~//f~rv/'f~ttfftt~~/tW/~/~/A1~/~ft~t t~//r~v/~/Af//t~~//r~~~~rrY~i//ifff~~if/~/tAeftV/~~~~f ~~J~P~/~~~I//l~~/~~/~/Y~~i~/p~fi~tt/~~vv~tY/J' ft//qVtvYfYvif/~//~p~t/fttlfV/tp~/'pt~fttp//Yif/f~f~/~~~t~tl 1~~//tftt8//~t//~/~~~/~//if~tv/AfY~//p~r.~ri//~~~//ftf~ ~~t~f~J~~~/tp/~~ll/J~/pf~~f/t~/pf~~~f!~/t~~~~/~~Jt~J The City has received Notice of Intent to Prepay from two projects, with a possible loss of l86 affordable units. The City shall involve itself in the negotiation process that is mandated under ELIPHA and LIHPRHA to ensure that every opportunity to retain affordability is pursued. III-21 The following actions are proposed to respond to the HUQ Section 236 "at-risk" conditions in Chula Vista: Duri no the current p 1 ann i no peri ad , its preservation efforts toward the which have expirino use contracts. all 386 low income units, the Citv wi 11 concentrate 386 HUD Section 236 units Our obiective is preserve 1. 1 As illustrated on Daqe 11-18, the City ~Ill hii reviewed its inventory of rental housing and determineg which units have prepayment options and at what date. Since the Citv is aware that owners are allowed to file a Not ice of Intent 18 months before the 20th anniversarv of their endorsement date and has determined these dates. Citv staff will monitor for these Notices of Intent. 1 When notices are filed, the City will monitor the process of negotiations, Le.. olans of action and participate as necessary. The City will work to prevent prepayment based on a unsuccessful escrow or a finding of "not needed in the commun ity" . 2. 1 As listed on paqe 11-20, the City ~Ill hii identifiied potential buyers for "at risk" HUD Section 236 projects and will assist Y~//f~if~//~/fpt p~f~~~~~ bv determinino resources for acquisition. In fact, Aoencv staff is currentlv workino with one of the oroanizations listed on 11-20 to alan for the oossibilitv of conversion, If this non-orofit is unable to work with the Aoencv. the Aoencv l~ft//~Yt, will give assistance priority to ~ non-profit community development corporation~ who can demonstrate caoacitv. ~~p~~j1jti ~~~//~~p//~j11//~~j~t~j~//lp~~/t~f~//~ffpf~~~j1jtij///~pj~t ~~~t~f~~//~ft~fflV/~-~JYF~//~if//r~rI1r~rYr//~ft~~lpp~f~ ~j11///tyiq//~//tp~tJ~fttft~/.////7~~//A!Vv.V//~///~p~~j~~f pfp~j~j~~//pf~~~~~lpp~~~t//f~~~j~~//tp//~~ft~l~//~p~/pfp'jt~ t~//q~~~/~/J~JtJ~)//1t~~1//~/JYF//~tAPJtJtJp~/. ~ Aoencv will consider util izino the $200,000 identified on Dace 11-20 to provide fundino for oredevelooment costs and acquisition in order to enable non-profits to preserve the Citv's HUD Section 236 Units. 3. The C ity ~~i plan s to form an ad-hoc commi ttee comprised of non-profit and for-profit developers, City sta ff, other 1 oca 1 government offi cia 1 s, and tenants of "at-risk" units to develop a formal strategy for preservation. A.2 Non-236 Units As identified in Section 11, the City has 1ft/. l.!l2 non-HUD Section 236 units which are at-risk of converting to market rate rentals. The following actions are proposed to respond to these units: 1. 1~~ City staff will continue. in the next several months, to pursue the possibility of refinancing the bonds for Eucalyptus Grove Apartments so that rental restrictions will continue. III-22 . 74 2. ~~ Since the current restricted rents at Beacon Cove Apartments are close to market rate, preserving these units does not seem to be the best use of funds. Rent subsidies may be considered bv Citv staff when the use restrictions for these oroiects expire. /.//~~~ However. the City has other urgent needs such as preserving the HUD Section 236 units, continuing the Agency's rehabilitation program, and funding non-profits who will provide units . for very low-income households. ~ As mentioned on pace 11-22, the Citv will attempt to work with the owner of Terra Nova Villas to extend the affordabil itv restrictions bv determininc an alternative form of credit enhancement. !.. Si nce The Meadows was bu i lt with a seni or dens ity bonus, conversion Pfp~ft~Jl will likelv not occur. l~~ City staff wi 11 f.,6N-~/1.M/ /'1<1 man itor the project in the vear 2000 and after, If conversion is requested, the City fttt~;,pt wi 11 work to negot i ate cant i nued rent restri cti ons. B. Community Appearance/Neighborhood Improvement Program The Building and Housing Department will continue to oversee and implement this pro-active program of neighborhood preservation and improvement. Initiated in March 1989, this program targets specific neighborhoods exhibiting high volumes of citizen complaints in which Code Enforcement Officers, teami ng with res i dents and des i gnated "Block Captains" , 1 I I - 22 a EXHIBIT B ADDENDUM TO NEGATIVE DECLARATION (IS-92-08A) [Addendum to Negative Declaration IS-92-08 for 1991 Revisions to the Housing Element of the General Plan] PROJECT NAME: GPA-90-9(A): Consideration of State-Mandated Revisions Regarding the 1991 Housing Element of the Chula Vista General Plan,(chapter 1451, statutes of 1989), Relating to the Preservation of Subsidized Housing at Risk of Conversion. PROJECT LOCATION: City-wide PROJECT APPLICANT: City of Chula Vista CASE NO.: IS-92-08A I. INTRODUCTION The environmental review procedures of the City of Chula Vista allow the Environmental Review Coordinator (ERC) to prepare an addendum to a Negative Declaration or Environmental Impact Report, if one of the following conditions is present: 1. The minor changes in the project design which have occurred since completion of the Pinal EIR or Negative Declaration have not created any new significant environmental impacts not previously addressed in the Pinal EIR or Negative Declaration; 2. Additional or refined information available since completion of the Pinal EIR or Negative Declaration regarding the potential environmental impact of the project, or regarding the measures or alternatives available to mitigate potential environmental effects of the project, does not show that the project will have one or more significant impacts which were not previously addressed in the Pinal EIR or Negative Declaration. This addendum has been prepared in order to address minor technical changes to the Housing Element of the General Plan related to the status of At-Risk Housing. Therefore, in accordance with Section 15164 of the CEQA Guidelines, the City has prepared the following Addendum to the Negative Declaration for the Housing Element revisions (IS-92-08A). A. PROJECT BACKGROUND In 1991, the City of Chula Vista updated the Housing Element of the General Plan in accordance with the requirements of the State of California Department of Housing and Community Development. The update was prepared to ensure that local policies and programs are responsive to changing conditions and future housing needs. Subsequent to the approval of the Housing Element Update, amendments have been proposed to update the status and improve accuracy of information provided in Section C: At-Risk Housing. B. PROJECT DESCRIPTION The proposed amendments to the Housing Element address At-Risk Housing inventories, unit condition, and the status of funding and financing arrangements. The purpose of the proposed amendments is to improve the City's efforts at preserving affordable housing units that are potentially at risk of converting to market type rentals between 1991 and 2001. C. IDENTIFICATION OF POTENTIAL ENVIRONMENTAL EFFECTS The proposed amendments will not result in any significant environmental impacts. The proposed amendments address the affordable status of existing housing units and will not result in a change in the density or total housing units available within the City. The focus of the effort for this project is to maintain unit affordability status and consequently maintain the demographic profile of residents within the subject units. Since the number of units and the anticipated household size will remain unchanged, no increases in population are anticipated to result from this project. E. CONCLUSION The proposed project amendments are not associated with any significant or potentially significant environmental impacts, therefore, no project specific mitigation will be required and the findings of the Initial Study and Negative Declaration for the 1991 Revisions to the Housing Element of the General Plan remain unchanged. -2- Pursuant to Section 15164 of the State CEQA Guidelines and based upon the above discussion, I hereby find that the project revisions to the proposed project will result in only minor technical changes or additions which are necessary to make the Negative Declaration adequate under CEQA. -kil7 ~~~~ - E RONMENTAL REVIEW COORDINATOR REFERENCES General Plan Housing Element, City of Chula Vista City of Chula Vista Environmental Review Procedures Negative Declaration IS-92-08, 1991 Revisions to the Housing Element of the General Plan, October 11, 1991 -3- RESOLUTION GPA-90-09(A) RESOLUTION OF THE CITY PLANNING COMMISSION OF THE CITY OF CHULA VISTA APPROVING AMENDMENTS TO THE GENERAL PLAN HOUSING ELEMENT OF 1991 REGARDING THE PRESERVATION OF AT- RISK HOUSING AS REQUIRED BY STATE HOUSING ELEMENT LAW WHEREAS, on May 15, 1992, the State Department of Housing and Connnunity Development ("HCD") issued a letter notifying the City that the Housing Element of 1991 was found in compliance with State law, excepting those provisions for the preservation of at-risk housing brought about by Chapter 1451, Statutes of 1989, and to affect compliance after July I, 1992; and, WHEREAS, in response, the City, in cooperation with HCD, prepared necessary amendments to the Housing Element of 1991 regarding the preservation of at-risk housing units; and, WHEREAS, in accordance with Government Code Section 65585(b), the City submitted for review by, and received approval of the proposed amendments from HCD by their letter dated September 25, 1992; and, WHEREAS, pursuant to Government Code Section 65585(c) the City is now required to formally adopt those amendments as part of the Housing Element of 1991, and to provide a copy of the amended Housing Element to HCD to obtain full legal compliance; and, WHEREAS, an Initial Study and Negative Declaration thereon (lS-92-08), of possible significant environmental impacts of the 1991 Housing Element was previously issued by the Environmental Review Coordinator; and, WHEREAS, the Environmental Review Coordinator has reviewed the proposed amendments and determined that no new environmental issues not previously analyzed by that Initial Study and Negative Declaration (IS-92-08) are raised, and has thereby issued an Addendum to the Negative Declaration (IS-92-08A) for the proposed amendments. NOW THEREFORE BE IT RESOLVED that the City Planning Connnission considered said amendments to the Chula Vista Housing Element of 1991 at a duly noticed public hearing held August 24, 1994, at which they considered the Negative Declaration and Addendum thereto (lS-92-08A), unanimously approved said amendments, and reconnnended adoption of the proposed amendments by the City Council in accordance with the attached draft City Council Resolution and the findings contained therein. PASSED AND APPROVED BY THE PLANNING COMMISSION OF CHULA VISTA, CALIFORNIA, this 24th day of August, 1994, by the following vote, to-wit: AYES: NOES: ABSENT: ABSTENTIONS: William Tuchscher II, Chairman ATTEST: Nancy Ripley, Secretary (M:\SHARED\HE-AM-PC::.RSQ) RESOLUTION NO. DRAF1 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA ADOPTING AMENDMENTS TO THE GENERAL PLAN HOUSING ELEMENT OF 1991 REGARDING THE PRESERVATION OF AT- RISK HOUSING AS REQUIRED BY STATE HOUSING ELEMENT LAW WHEREAS, on May 15, 1992, the State Department of Housing and Connnunity Development ("HCD") issued a letter notifying the City that the Housing Element of 1991 was found in compliance with State law, excepting those provisions for the preservation of at-risk housing brought about by Chapter 1451, Statutes of 1989, and to affect compliance after July I, 1992; and, WHEREAS, in response, the City, in cooperation with HCD, prepared necessary amendments to the Housing Element of 1991 regarding the preservation of at-risk housing units; and, WHEREAS, in accordance with Government Code Section 65585(b), the City submitted for review, and received approval of the proposed amendments from HCD by their letter dated September 25, 1992; and, WHEREAS, pursuant to Government Code Section 65585(c) the City is now required to formally adopt those amendments as part of the Housing Element of 1991, and to provide a copy of the amended Housing Element to HCD to obtain full legal compliance; and, WHEREAS, an Initial Study and Negative Declaration thereon (IS-92-08), of possible significant environmental impacts of the 1991 Housing Element was previously issued by the Environmental Review Coordinator; and, WHEREAS, the Environmental Review Coordinator has reviewed the proposed amendments and determined that no new environmental issues not previously analyzed by that Initial Study and Negative Declaration (IS-92-08) are raised, and has thereby issued an Addendum to the Negative Declaration (IS-92-08A) for the proposed amendments; and, WHEREAS, the City Planning Commission considered said amendments at a duly noticed public hearing held August 24, 1994, at which they considered the Negative Declaration and Addendum thereto (lS-92-08A), and voted unanimously (vote: ) to approve said amendments and recommend their adoption by the City Council; and, WHEREAS, the City Council conducted a duly noticed public hearing on September 6, 1994, to consider the Negative Declaration and Addendum thereto (IS-92-08A), and the proposed amendments to the Housing Element of 1991 and recommendations thereon. 'f;+ I'RA. FT u NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF CHULA VISTA does hereby find, order, determine, and resolve as follows: 1. That the proposed amendments to the City's Housing Element of 1991 will have no significant environmental impacts, and adopts the Addendum to the Negative Declaration issued under IS-92-08A. 2. That the proposed amendments are consistent with the goals and objectives of the General Plan Housing Element of 1991 regarding the preservation and enhancement of available low-income housing stock within the City. BE IT FURTHER RESOLVED that the City Council of the City ofChula Vista does adopt the proposed amendments to the Housing Element of 1991 regarding the preservation of at-risk housing units, a copy of which amendments are attached hereto as Exhibit A, and authorizes the filing of said adopted amendments with the State Department of Housing and Connnunity Development as necessary to bring the City's Housing Element into full compliance with State law. Presented by Robert A. Leiter Director of Planning Bruce Boogaard City Attorney (M:\SHARED\HE-AM-CC .RSQ)