Item 24 - Agreement No. 2025-01 - MLC Holdings

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Density Bonus Agreement No. 2025-01 — MLC Holdings, Inc./Meritage Homes at 2020 East First Street April 15, 2025 Page 2 includes 80 townhome units and six duplexes (86 total units), at the property located at 2020 East First Street. The project would include five units designated for very low-income households earning 30-50 percent of the Area Median Income (AMI). As proposed, the project will utilize one concession to deviate from Metro East Mixed -Use Overlay Zone (MEMU) development standards through the density bonus agreement pursuant to California Government Code Sections 65915 through 65918 and Santa Ana Municipal Code (SAMC) Sections 41-1600 through 41-1607. Staff recommends approval of the DBA as the project aligns with the intent of the General Plan and MEMU overlay district to establish residential mixed -use and employment centers that are well connected to public transportation. Additionally, the project contributes to the community's affordable and market -rate ownership housing stock, represents a significant reinvestment in a currently vacant site, does not result in adverse environmental impacts or serious public health concerns, and is consistent with various goals and policies of the General Plan. Planning Commission Action On March 24, 2025, the Planning Commission held a public hearing for the project and voted 6:0:1, with Commissioner Leo absent, to approve Site Plan Review Application (SPR) No. 2025-01, Vesting Tentative Tract Map (VTTM) No. 2025-01 (County Map No. 19337) for condominium purposes, and to recommend that the City Council approve Density Bonus Agreement No. 2025-01. The Planning Commission included additional conditions of approval to allow staff to work with the applicant to redesign the proposed duplexes storefront and to work with the applicant on determining the feasibility of adding additional affordable units or a deeper affordability as part of the overall project. Moreover, pursuant to Section 41-1607 of the SAMC, the Planning Commission made the required findings to approve a development concession as part of the density bonus agreement. Following this vote, the item requires City Council approval of the density bonus agreement. Staff notes that since the Planning Commission meeting the applicant has worked with planning staff to address the redesign of the proposed duplex storefront. In the revised floor plans, the front door to each proposed duplex has been relocated from the side - entry and incorporated into a front -entry design. The front entry to each duplex will be incorporated into the proposed storefront, accessible from the porch area, and will face First Street. In addition, the applicant has engaged conversations with the City's Housing Division and has demonstrated a good faith effort to work with staff to explore the feasibility of incorporating additional affordable units and/or incorporating a deeper affordability rate at extremely low-income. The feasibility of additional affordable units or a deeper affordability rate will depend on multiple factors (e.g., affordable sales price, cost of construction, etc.). The conversations between the applicant and City staff are ongoing at the time this report was printed.