HomeMy WebLinkAbout80A - RSI DEVELOPMENTREQUEST FOR COUNCILI
AGENCY ACTION
MEETING DATE:
JANUARY 5, 2009
TITLE:
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JOINT PUBLIC HEARING - DISPOSITION AND
DEVELOPMENT AGREEMENT WITH RSI DEVELOPMENT
LLC
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CITY MANAGER EXECUTI DIRECTOR
RECOMMENDED ACTION
CITY COUNCIL ACTION
CLERK OF COUNCIL USE ONLY:
APPROVED
^ As Recommended
^ As Amended
^ Ordinance on 1st Reading
^ Ordinance on 2nd Reading
^ Implementing Resolution
^ Set Public Hearing For
CONTINUED TO
FILE NUMBER
Adopt a resolution regarding the sale of 1112 and 1118 S. Orange to RSI
Development LLC for the development of two affordable, detached single-
family homes.
COMMUNITY REDEVELOPMENT AGENCY ACTION
Adopt a resolution approving a Disposition and Development Agreement
between the Community Redevelopment Agency and RSI Development LLC for
the development of two affordable, detached single-family homes at 1112
and 1118 S. Orange.
COMMUNITY REDEVELOPMENT AND HOUSING COMMISSION RECOMMENDATION
At its Regular Meeting of December 2, 2008, by a vote of 6:0, the
Community Redevelopment and Housing Commission recommended to continue
this item to the December 16, 2008, meeting to allow them time to review
the new project in context with the existing neighborhood.
At its Regular Meeting of December 16, 2008, by a vote of 4:1 (Vasquez,
No), the Community Redevelopment and Housing Commission recommended that
City Council adopt a resolution regarding the sale of 1112 and 1118 S.
Orange to RSI Development LLC for the development of two affordable,
detached single-family homes and recommended that the Community
Redevelopment Agency adopt a resolution approving a Disposition and
80A-1
Joint Public Hearing -
DDA with RSI Development LLC
January 5, 2009
Page 2
Development Agreement between the Community Redevelopment Agency and RSI
Development LLC for the development of two affordable, detached single-
family homes at 1112 and 1118 S. Orange, and which should include
collaboration between the developer and the Eastside Neighborhood
Association to develop home designs compatible with the historical
integrity of the neighborhood.
DISCUSSION
A key objective of the Redevelopment Agency (Agency) is to expand and
preserve affordable housing. To that end, the Agency staff has been
working to develop Agency-owned property at 1112 and 1118 S. Orange
Avenue (Exhibit 1) which was acquired as part of the McFadden
Realignment project.
Ronald M. Simon (RSI Development, LLC) has proposed a model project for
this site consisting of two single-family homes (Exhibit 2). Mr. Simon
has been recognized for his success in transforming the manufacturing
process of bathroom and kitchen cabinetry by streamlining the supply
chain and business process. The proposed model project will duplicate a
similar precision manufacturing model. The construction process is
controlled to enhance productivity and reduce waste of building
materials. The houses are designed to match building product
dimensions, thereby minimizing waste and utilizing wall panels and
precut structural components to reduce building time. These homes will
also meet Energy Star rating.
Although the home designs have been created taking into consideration
neighborhood compatibility, RSI will continue to work with Eastside
Neighborhood Association representatives to ensure that the new homes
support the historical integrity of the neighborhood.
The terms of the Disposition and Development Agreement (DDA) with RSI
provide for: 1) transfer of 1112 and 1118 S. Orange to RSI, at no cost;
and, 2) Agency funded construction financing, including soft costs, in
the amount of $225,000. The homes will have three and four bedrooms,
with 1,621 and 1,968 square feet, respectively. They will be sold to
low-income households earning no more than 80o Area Median Income (AMI),
for a sale price of $160,700 and $171,700, respectively.
The homebuyers will be responsible for securing the financing for the
First Trust Deed and will execute a zero-interest promissory note and
trust deed (silent second) with the Community Redevelopment Agency. The
80A-2
Joint Public Hearing -
DDA with RSI Development LLC
January 5, 2009
Page 3
amount of the note will be equal to the difference between the fair
market value of the homes and the affordable sales price at the time of
completion. In accordance with previous direction from the Community
Redevelopment and Housing Commission, preference will first be given to
homebuyers that are military veterans and who live or work in Santa Ana.
The second preference is for homebuyers who live or work in Santa Ana.
The homes will be sold through a lottery process. The sale of these
properties will be income-restricted for a period of forty-five years in
accordance with California Redevelopment Law. All subsequent homeowners
must also meet income eligibility requirements. It is anticipated that
construction will commence by February 2009 and be completed in April
2009.
Construction of these homes will assist the City and Agency in meeting
the Regional Housing Needs Assessment (RHNA) goals identified in the
Housing Element and the Agency's replacement and inclusionary housing
obligations.
On December 22 and December 29, 2008, notification was published in the
Orange County Reporter that a public hearing will be held with regard to
the proposed sale of the property at 1112 and 1118 S. Orange to RSI
Development LLC.
ENVIRONMENTAL COMPLIANCE
In accordance with the California Environmental Quality Act, the
proposed project is exempt from further review.
FISCAL IMPACT
Funds are available in the Tax Increment Housing Set-Aside account (no.
507-936-6631).
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She ly Landry-Bayle
Ho ing Manager
Community Development Agency
CJN/SLB/mlr
APPROVED AS TO FUNDS AND ACCOUNTS:
Francisco Gutierrez
Executive Director
Finance and Management Services Agency
H:\ACTION ITEMS\COUNCIL\2009\010509 JT PH CC-CRA DDA RSI (1).doc
80A-3
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80A-6
RESOLUTION NO. 2009-
A RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF SANTA ANA MAKING CERTAIN
FINDINGS WITH RESPECT TO THE
CONSIDERATION TO BE RECEIVED BY THE
COMMUNITY REDEVELOPMENT AGENCY OF
THE CITY OF SANTA ANA PURSUANT TO A
DISPOSITION AND DEVELOPMENT AGREEMENT
BETWEEN THE AGENCY AND RSI
DEVELOPMENT, LLC, FOR THE SALE OF
CERTAIN REAL PROPERTY AND APPROVING
THE SALE OF SAID REAL PROPERTY UPON THE
TERMS AND CONDITIONS CONTAINED IN THAT
AGREEMENT
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SANTA ANA, AS
FOLLOWS:
Section 1: The City Council of the City of Santa Ana hereby finds, determines and
declares as follows:
A. The Community Redevelopment Agency of the City of Santa Ana
(hereinafter referred to as the "Agency") is engaged in activities necessary
to execute and implement the Redevelopment Plan for the Merged
Redevelopment Projects, including strengthening of public-private
partnerships to provide more affordable housing, and particularly to
provide decent, safe, sanitary, and affordable housing to the lower income
citizens of the City of Santa Ana.
B. In order to implement the Redevelopment Plan, the Agency
proposes to sell said real property located at 1112 and 1118 S. Orange
Street (the Property) pursuant to the terms and provisions of a Disposition
and Development Agreement (hereinafter referred to as the "Agreement")
between the Agency and RSI Development, LLC, which is on file in the
office of the Executive Director of the Agency.
C. RSI Development, LLC, shall construct and sell these two homes to
income qualified households. The term of affordability on each of the
homes will be forty-five years.
D. The consideration for the Property is not less than the fair market
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80A-7
and conditions and development costs authorized by the sale.
E. The Agreement contains all of the provisions, terms, conditions and
obligations required by the state and local laws, as well as long-term
affordability covenants benefiting the Agency.
F. RSI Development, LLC, possesses the qualifications and financial
resources necessary to acquire and insure development of the Property as
two single-family homes to be sold to qualified low income families in
accordance with the purpose and objectives of the Redevelopment and
Implementation Plan.
G. Pursuant to the provisions of the California Redevelopment Law, the
Agency and the City Council have held a duly noticed joint public hearing on
the proposed sale of the Property in compliance with Health and Safety
Code section 33433.
Section 2. The City Council has considered all terms and conditions of the
proposed sale to RSI Development, LLC, and hereby finds and determines that the sale
and development of the Property pursuant to the Agreement is in the best interest of the
City of Santa Ana and the health, safety and welfare of its residents, and is in accord with
the public purpose and provisions of the applicable state and local laws.
Section 3. The City Council hereby finds and determines that the consideration
for the sale of the Property pursuant to the Disposition and Development Agreement is
not less than the fair market value of the Property determined in accordance with the
covenants and conditions governing the sale.
Section 4. The sale of the Property by the Agency to RSI Development, LLC,
upon the terms and conditions contained in the Agreement is hereby approved.
Section 5. The Clerk of the Council shall attest to and certify the vote adopting
this Resolution.
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80A-8
ADOPTED this day of , 2009.
Miguel A. Pulido
Mayor
APPROVED AS TO FORM:
Joseph W. Fletcher, City Attorney
By:
Lisa E. Storck
Assistant City Attorney
AYES: Councilmembers:
NOES: Councilmembers:
ABSTAIN: Councilmembers:
NOT PRESENT: Councilmembers:
CERTIFICATION OF ATTESTATION AND ORIGINALITY
I, PATRICIA E. HEALY, Clerk of Council, do hereby attest to and certify the attached
Resolution No. to be the original resolution adopted by the City Council
of the City of Santa Ana on , 2009.
Date:
Clerk of Council
City of Santa Ana
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80A-9