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2005 03 03 RDAe a eo 4 4 adja Redevelopment Agency Agendas are Available on the City's Web Page @ www.la-quinta.org REDEVELOPMENT AGENCY AGENDA CITY COUNCIL CHAMBERS 78-495 Calle Tampico La Quinta, California 92253 Regular Meeting Thursday, March 3, 2005 - 2:00 P.M. Beginning Resolution No. RA 2005-001 CALL TO ORDER Roll Call: Agency Board Members: Adolph, Henderson, Perkins, Sniff, and Chairman Osborne PUBLIC COMMENT At this time, members of the public may address the Redevelopment Agency on any matter not listed on the agenda. Please complete a "request to speak" form and limit your comments to three minutes. Please watch the timing device on the podium. CLOSED SESSION 1. CONFERENCE WITH THE AGENCY'S REAL PROPERTY NEGOTIATOR, MARK WEISS, PURSUANT TO GOVERNMENT CODE SECTION 54956.8 CONCERNING POTENTIAL TERMS AND CONDITIONS OF ACQUISITION AND/OR DISPOSITION OF A PORTION OF 525 ± ACRES LOCATED AT THE SOUTHWEST CORNER OF AVENUE 52 AND JEFFERSON STREET. PROPERTY OWNER/NEGOTIATOR: THEODORE LENNON, DESTINATION DEVELOPMENT CORPORATION. NOTE: Time permitting the Redevelopment Agency Board may conduct Closed Session discussions during the dinner recess. In addition, persons identified as negotiating parties are not invited into the Closed Session meeting when the Agency is considering acquisition of real property. Redevelopment Agency Agenda 1 March 3, 2005 RECONVENE AT 3:00 P.M. PUBLIC COMMENT At this time members of the public may address the Agency Board on items that appear within the Consent Calendar or matters that are not listed on the agenda. Please complete a "request to speak" form and limit your comments to three minutes. When you are called to speak, please come forward and state your name for the record. Please watch the timing device on the podium. For all Agency Business Session matters or Public Hearings on the agenda, a completed "request to speak" form should be filed with the City Clerk prior to the Agency beginning consideration of that item. CONFIRMATION OF AGENDA APPROVAL OF MINUTES 1. APPROVAL OF MINUTES OF FEBRUARY 15, 2005. CONSENT CALENDAR NOTE: Consent Calendar items are considered to be routine in nature and will be approved by one motion. APPROVAL OF DEMAND REGISTER DATED MARCH 3, 2005. 2. APPROVAL OF AMENDMENT NO. 5 TO THE KEITH COMPANIES FOR DRAINAGE IMPROVEMENTS TO AVENUE 52, SilverRock RESORT. 3. APPROVAL OF A CONTRACT AMENDMENT WITH GMA INTERNATIONAL FOR STRUCTURAL DESIGN OF ENTRANCE MONUMENT SIGNAGE FOR SilverRock RESORT. BUSINESS SESSION - NONE STUDY SESSION - NONE CHAIR AND BOARD MEMBERS' ITEMS - NONE Redevelopment Agency Agenda 2 March 3, 2005 PUBLIC HEARINGS 1. JOINT PUBLIC HEARING BETWEEN THE CITY COUNCIL AND REDEVELOPMENT AGENCY TO CONSIDER THE SALE OF REAL PROPERTY LOCATED AT 53-365 EISENHOWER DRIVE BY AND BETWEEN THE LA QUINTA REDEVELOPMENT AGENCY AND FRANCISCO AND MARGERY MORENO. A. MINUTE ORDER ACTION ADJOURNMENT Adjourn to a regularly scheduled meeting of the Redevelopment Agency to be held on March 15, 2005 commencing with closed session at 2:00 p.m. and open session at 3:00 p.m. in the City Council Chambers, 78-495 Calle Tampico, La Quinta, CA 92253. DECLARATION OF POSTING I, June S. Greek, City Clerk of the City of La Quinta, do hereby declare that the foregoing agenda for the La Quinta Redevelopment Agency meeting of Thursday, March 3, 2005, was posted on the outside entry to the Council Chamber at 78-495 Calle Tampico and on the bulletin boards at 51-321 Avenida Bermudas and 78-630 Highway 1 1 1, on Friday, February 25, 2005. DATED: KEYWORD I �� JUNE S. GREEK, CMC, City Clerk City of La Quinta, California Redevelopment Agency Agenda 3 March 3, 2005 4 Sepa�rw AGENDA CATEGORY: BUSINESS SESSION COUNCIL/RDA MEETING DATE: MARCH 3, 2005 CONSENT CALENDAR I ITEM TITLE: STUDY SESSION Demand Register Dated March 3, 2005 PUBLIC HEARING RECOMMENDATION: It is recommended the Redevelopment Agency Board: Receive and File the Demand Register Dated March 3, 2005 of which $6,476,832.90 represents Redevelopment Agency Expenditures. PLEASE SEE CONSENT CALENDAR ITEM NUMBER 1 ON CITY COUNCIL AGENDA COUNCIL/RDA MEETING DATE: March 3, 2005 ITEM TITLE: Approval of Amendment No. 5 to The Keith Companies for Drainage Improvements to Avenue 52, SilverRock Resort RECOMMENDATION: AGENDA CATEGORY: BUSINESS SESSION: CONSENT CALENDAR: STUDY SESSION: PUBLIC HEARING: Approve Amendment No. 5 to the Professional Services Agreement with The Keith Companies in an amount not -to -exceed $52,300 to provide civil engineering design of a bypass storm drain within Avenue 52 and to provide an aerial survey of SilverRock Resort, and authorize the Executive Director to execute the amendment. FISCAL IMPLICATIONS: On February 15, 2005, the Agency reviewed and approved the proposed mid -year budget adjustment allocating Redevelopment Project Reserves of $1.2 million and $400,000 in Project Area Nos. 1 and 2, respectively, for completing Phase I project improvements for SilverRock Resort. This contract amendment for storm drain improvements was part of that budget request. BACKGROUND AND OVERVIEW: On September 16, 2003, the Agency approved a Professional Services Agreement with The Keith Companies (TKC) to provide Civil Engineering Services for the SilverRock Resort project. On March 2, 2004, the Agency approved an amendment in the amount of $30,000 for additional survey work not included in TKC's original scope of work. On May 18, 2004, the Agency approved a second amendment in the amount of $178,079 to provide construction staking and water/sewer design. On August 17, 2004, the Agency approved a third amendment in the amount of $15,000 for additional electrical engineering services, partly for changes requested by the Hope Classic tournament. S:\CityMgr\STAFF REPORTS ONLY\3-03-05\C6 Keith Co No. 5.doc On December 21, 2004, the Agency approved Amendment No. 4 in the amount of $42,900 for survey and'staking related to perimeter landscaping improvements as well as survey work necessary to provide an easement to the BOR for their relocated vault and waterline adjacent to Village Lake No. 3. Amendment No. 5 in the amount of $52,300 is for the following two tasks: Task A in the amount of $25,800 would provide design and preparation of construction documents for constructing a 48" bypass storm drain line within Avenue 52. This storm drain would connect to the existing storm drain between the Calle Rondo Drain in Avenue 52 and extend the pipe approximately 2,200' to the east past the entrance improvements onto the future second golf course at SilverRock Resort. This storm drain will alleviate the flooding concerns that currently exist adjacent to the fourth tee box and fairway on the Palmer Classic Course, and will also more evenly distribute the hydraulic loading over the entire site. Task B in the amount of $26,500 is for aerial topography of the existing contours within SilverRock Resort. This item was identified by PACE Engineers as a means of establishing the as -built condition of the site in order to facilitate secondary drainage design. Since some of the contours were revised by Palmer Course Design Company during construction, exact topographic information is necessary. This work will also establish the existing contours within the second golf course envelope for future reference. FINDINGS AND ALTERNATIVES: The alternatives available to the Agency Board include: 1 . Approve Amendment No. 5 to the Professional Services Agreement with The Keith Companies in an amount not -to -exceed $52,300 to provide civil engineering design of a bypass storm drain within Avenue 52 and to provide an aerial survey of SilverRock Resort, and authorize the Executive Director to execute the amendment; or 2. Do not approve Amendment No. 5 to the Professional Services Agreement with The Keith Companies in an amount not -to -exceed $52,300 to provide civil engineering design of a bypass storm drain within Avenue 52 and to provide an aerial survey of SilverRock Resort, and do not authorize the Executive Director to execute the amendment; or 3. Provide staff with alternative direction. S:\CityMgr\STAFF REPORTS ONLY\3-03-05\C6 Keith Co No. 5.doc 2 Respectfully submitted, w imothy R. sso . E. Public Work irect /City Engineer Approved for submission by: rz) Thomas P. Genovese, Executive Director Attachment: 1 . The Keith Companies' Proposal S:\CityMgr\STAFF REPORTS ONLY\3-03-05\C6 Keith Co No. 5.doc 3 01/31/2005 13:47 FAX 760 346 9368 TKC Palm Desert Q 002 ATT CHMENT 1 Task A Task B SILVERROCK RESORT PROPOSAL AVENUE 52 STORM DRAIN AND AERIAL TOPOGRAPHY J,A.NUARY 319 2005 Based on direction from the City of La Quints and our understanding of the SilverRoek Resort project, The Keith Companies (TKC) proposes to perform the following work: A. Avenue 52 Storm Drain Improvement Plan TKC will prepare a storm drain improvement plan at 1"=40' scale for the extension (approximately 2,200 linear feet) of an existing 48" diameter storm drain pipe past the Avenue 52 SilverRock entry. The plan will include a title sheet, plan and profile sheets and a detail sheet if needed. No hydrology is included except to quantify the flows from two adjacent catch basins on Avenue 52 which will connect to this line. The storm flows in the existing 48" pipe have been quantified in previous reports and an HGL is shown on the existing improvement plans. TKC will rely on this information and prepare a drainage summary, not a complete drainage report. TKC will process the plans through the City of La Quianta and will prc-pare an engineer's estimate to accompany the plans. Bid specifications, bid support and construction support are included as optional. TKC will provide a preliminary schedule for plan preparation and processing upon request. B. Site Aerial Topography TKC will establish 14 permanent ground control monuments, with targets. TKC will contract with an aerial mapping firm to provide the aerial photography and digital photolgammetric services to prepare a digital topographic map on 3D-DWG AutoCAD format at a scale of P— 40' with 1-foot contour intervals and spot elevations plotted. One (1) set of 1"= 300' photos will be provided. The aerial topography generally includes the project boundary (approximately 525 acres) with a 200' overlap. TKC will provide said digital topography within three to fours after written authorization to proceed. Avenue 52 Storm Drain Plans ................................................. $20.1000 Utility Research and Design Survey .......................................... $2,000 Bid Specifications and Support (Optional) ................................ $3,000 Construction Support (Optional) .................................................. 800 TASK A: $259800 Aerial Topography...................................................................$26,500 TASK B: S26,500 al 01/31/2005 13:48 FAX 760 346 9368 TKC Palm Desert [a] 003 SILVERROCK RESORT PRELIMINARY ESTIMATE OF PROBABLE CONSTRUCTION COSTS AVENUE 52 STORM DRAIN IMPROVEMENTS PREPARED BY: THE KEITH COMPANIES J N 40256.01-460 1 /31 /05 DESCRIPTION QUANTITY UNITS MOBILIZATION 1 LS SAWCUT, REMOVE AND REPLACE AC/AB 22,000 SF INSTALL ,!UNCTION STRUCTION/MANHOLE 6 EA INSTALL 48" RCP 2,200 LF INSTALL CALTRANS TYPE HEADWALL 1 EA SUBTOTAL 10% CONTINGENCY TOTAL ESTIMATED COST NOTE: Additianal cost may be necessary if shoring is required. � I � �'' f' �� .j 1;.;'••; I�,�-"��',':.� •AID. �yi '�jh�a'J� .♦ 1. 1 ``"P �y�� { \':� �� C phi �� !'sly I,: �.: ._•!{�f`,�i�o 1, ��'!,.��/7 ' I •4 . r; •�' �.4. y UNIT TOTAL COST COST $ 5,000.00 $ 5,000.00 $ 2.00 $ 44,000.00 $ 6,000.00 $ 36,000.00 $ 110.00 $ 242,000.00 $10,000.00 $ 10,000.00 $ 337,000.00 $ 33,700.00 $ 370,700.00 73-733 FRED WARING DRIVE, SUITE 100 PALM DESERT, CA 92260 5 (760) 346-9844 FAX: (760) 346.9368 01/31/2005 13:48 FAX 760 346 9368 TKC Palm Desert 1@004 01/31/2005 13,49 FAX 760 346 9368 TKC Palm Desert [a005 The Keith Companies, Inc. Palm Desert, California Division FEE SCHEDULE — April 1, 2004 through March 31, 2005 Compensation for work performed on a time and materials basis will be computed as follows: Hourly Rate MANAGEMENT ....$155.00 President 150.00 VicePresident 11..................................................................................................................................... VicePresident I....................................•--------........................---..........................,_,.............----..I......I....1.148.00 DirectorIII..........................................................,-•---.....----.....................145.00 Director 11, Sr. Project Manager.............................................................................................................138.00 DirectorI ..........................................--•------•--..............................130.00 125-00 Project Manager .............. ....................... .............................. Manager, Supervisor II ....... I ....... I ............... Assistant Project ...............................................................................................120.00 110-00 SupervisorI............................................................................................................................................ CIVIL ENGINEERING AND MAPPING SER\nCES Sr. Project Engineer.............................. ............................................ ... ................................ .... .....-•--....1.00 :115. 0 Sr. Project Surveyor, Sr. Project Designer.............................................................................. ......... Project Engineer, Project Surveyor ................................................................................................. .......110.00 Project Designer, Sr. Survey Analyst...................................•-------.........................,_....-----..._....._....._.......105.00 Sr. Designer, Sr. Design Engineer ..............................:. .. Design Engineer, Designer, Survey Analyst, ProcessingManager .......................................... ......--...... 100,00 DesignTechnician ...........................................,..----...._....................................----......_..........90.00 AssistantEngineer, Sr. Technician..........................................................................................................88.00 Technician...................................................................................................•----.......82.00 80.00 Jr- Survey Analyst .................................................................................................................................... Jr. Engineer .............................................................................................78.00 Jr. Technician, Research/Processing Coordinator..................................................................................75.00 Engineering/Survey Aide...................................................................................................55,00 ProjectCoordinator .................................................................................................................................. 50.00 OfficeWork...................................................._..,..--......------................................---...._45.00 CULTURAL RESOURCES Project Manager/Archaeo & Paleo ....................'120-00 Archaeologist, Paleontologist.............................195.00 Field/Lab Supervisor......................................1....80.00 Field/Lab Technician III ........................................ 70.00 Feld/Lab Technician I I ........................................ 65.00 Field/Lab Technician I ......................................... 55.00 FIELD SURVEY Field Coordinator..............................................100.00 Survey Technician ............................................. 90.00 Three Person Crew ........................................... 215.00 Two Person Crew ........................••-----••..--.......190.00 One Person Crew.............................................165.00 PLANNING SERVICES Principal Planner.................................115.00 Sr. Planner..........................................110.00 Project Planner...................................100.00 Planner.................................................94-00 AssistantPlanner..................................86.00 Graphic Designer..................................80.00 Planning Technician.............................75.00 CONSTRUCTION Sr. Construction Mgr...........................106.00 Construction Manager ..........................90.00 Superintendent ..................................... 75.00 Laborer................................................. 55.00 Project Coordinator...............................50.00 Office Work ........................................... 45.00 SPECIAL SERVICES ConsultationRe: Litigation ....................................................................................... ,................•---.......$375.00 MISCELLANEOUS PEES The following services are billed at our cost plus 15%: + Subcontracted services. • Map check fees or filing fees advanced by us. Transportation, meals and lodging for overnight travel and incidental travel expenses. • Commercial delivery services, including Federal Express, Express Mail, and Messenger Services. Excessive long distance telephone calls, telegrams, and other costs directly applicable to the project. • Plotting and blueprint services and printing. (The client is encouraged to arrange for printing, other than prints or plots on our blueprint machine and plotters, to be contracted directly with an outside blueprint company acceptable to us.) MILEAGE............................... ....................................................... ......... ........................ ................ $ .375/mile NOTE. EEO obligations of Exec Order 11246 and 41 CFR Parts 60-1.4, 60-250.5 and 60-741.5 are incorporated in non-exampit US Government contracts/subcontracts. IKC Corporate Division President 0!M0I0S0,&Wkr ,&07W SMCDUL Vw "Im bq=1UU 4 T=pkiLm l 7 T4t!t 4 Zf4141 COUNCIL/RDA MEETING DATE: March 3, 2005 ITEM TITLE: Approval of a Contract Amendment with GMA International for Structural Design of Entrance Monument Signage for SilverRock Resort RECOMMENDATION: AGENDA CATEGORY: BUSINESS SESSION: CONSENT CALENDAR: 13 STUDY SESSION: PUBLIC HEARING: Approve a contract amendment with GMA International in an amount not to exceed $5,000 for the structural design services for entry monumentation at SilverRock Resort, and authorize the Executive Director to execute the amendment. FISCAL IMPLICATIONS: On February 15, 2005, the Agency reviewed and approved the proposed mid -year budget adjustment allocating Redevelopment Project Reserves of $1.2 million and $400,000 in Project Area Nos. 1 and 2, respectively, for completing Phase I project improvements for SilverRock Resort. This contract amendment for structural design services for the entry monuments to SilverRock Resort was part of that budget request. BACKGROUND AND OVERVIEW: In November 2002, the Agency Board awarded a contract to GMA International in the amount of $234,650 to create a conceptual master plan for SilverRock Resort. Subsequently, a second contract was approved by the Agency Board on June 17, 2003, in the amount of $144,600 for additional master plan coordination services, including: preparation of a water management plan (via a subcontract with PACE), master plan refinement in coordination with Palmer Course Design Company's golf course design, preparation of a conceptual grading and drainage plan, preparation of a conceptual landscape plan, preparation of project entry concepts for Jefferson Street and Avenue 54, preparation of a detailed design for the Avenue 52 entry, and websi,te maintenance services. S:\CityMgr\STAFF REPORTS ONLY\3-03-05\C9 GMA SRR Amendment.doc On December 16, 2003, the Agency Board approved a third contract with GMA in the amount of $92,100 to provide site planning for several key areas (clubhouse to resort core area, special use and casitas areas in relation to the golf course), resort golf course conceptual routing, facility site plan coordination with the Dahlin Group (building architect), detailed design for the Jefferson and Avenue 54 entrances, updating of the illustrative master plan, and miscellaneous planning/coordination services. With the award of a perimeter landscape construction contract on September 7, 2004, it became imperative to address the issue of monument signage. Because of GMA's previous involvement with the project, staff requested GMA to create signage concepts under Amendment No. 3. GMA presented these concepts to the Agency Board on September 22, 2004. The Agency Board requested modifications (i.e., sign verbiage, size, materials, etc.), as well as a life-size mock-up to be placed on -site. On October 5, 2004, the Agency approved a contract amendment with GMA International in an amount not to exceed $20,000 for monument signage design. This amendment is for structural design services for the above mentioned entry monument signs that were not included within Amendment No. 3 to GMA. This amendment will allow the completion of contract documents for the entrance monuments for SilverRock Resort. FINDINGS AND ALTERNATIVES: The alternatives available to the Agency Board include: 1. Approve a contract amendment with GMA International in an amount not to exceed $5,000 for the structural design services for entry monumentation at SilverRock Resort, and authorize the Executive Director to execute the amendment; or 2. Do not approve a contract amendment with GMA International in an amount not to exceed $5,000 for the structural design services for entry monumentation at SilverRock Resort, and do not authorize the Executive Director to execute the amendment; or 3. Provide staff with alternative direction. 2 Respectfully submitted, othy R Jo as , P. E. Public Works -tire or/City Engineer Approved for submission by: Thomas P. Genovese, Executive Director Attachment: 1. Amendment No. 4 K3 S:\CityMgr\STAFF REPORTS ONLY\3-03-05\C9 GMA SRR Amendment.doc ATTACHMENT 1 PROFESSIONAL SERVICES AGREEMENT AMENDMENT NO.4 PROJECT: SilverRock Resort Planning Services CONSULTANT: GMA International Pursuant to the terms of the original Contract Agreement, you are hereby directed to make the herein described changes or do the following described work not included in the plans and specifications for this Contract. Unless otherwise stated all work shall conform to the terms, general conditions, and special provisions of the original Contract. DESCRIPTION OF CHANGE: Provide structural engineering design services for monument signage at SilverRock Resort. Contract #3 Amount $92,100.00 Add this Amendment $59000.00 Total $979100.00 Submitted By: Date: Approved By: Date: We, the undersigned Consultant, have given careful consideration to the change proposed and hereby agree, if this proposal is approved, that we will provide all equipment, furnish all materials, perform all labor, except as may be noted above, and perform all services necessary to complete the above specified work, and hereby accept as full payment the amount shown above. Accepted By: Title: Consultant: Date• PSA96041.doc 4 RUNYAN ENGINEERING, INC. 437 South Cataract Avenue Suite 6 San Dimas, CA 91773 909.394.3496 office 909.394.4927 fax February 11, 2005 ENGAGEMENT CONFIRMATION CUSTOMER: Mr. Steve Garcia GMA Landscape Arhitecture 28th Street Marina — 2700 Newport Blvd. Suite 190 Newport Beach, CA 92663 SITE: SilverRock Resort SERVICES PROVIDED: RUNYAN ENGINEERING, INC. will provide professional engineering services as follows: Entry & Monument Sign FEE SCHEDULE: Structural Engineering Structural Drawings City Fees & Processing Soil Engineering & Report Construction Observation PAYMENT SCHEDULE: Retainer esitmated costs: copies & prints Progress payments 10 hrs $ 2,500.00 10 hrs $ 2,500.00 Not Included Not Included Not Included TOTAL FEES = $ 5,000.00 Please Pay = $ (2,500.00) $ 500.00 $ 3,000.00 The customer shall return a signed copy of this Engagement Confirmation to Engineer. The terms and conditions of this Engagement are set forth in the attached GENERAL CONDITIONS. Failure to object to any of the terms and conditions set forth in this Engagement Confirmation within ten (10) days of this date set forth above, shall constitute acceptance thereof. Changes to the scope of work will be invoiced per our attached Fee Schedule. ENGINEER: Bv: Title: William Runyan, President CUSTOMER: By: _ Title: 5 4 COUNCIL/RDA MEETING DATE: March 3, 2005 ITEM TITLE: A Joint Public Hearing Between the City Council and Redevelopment Agency to Consider the Sale of Real Property Located at 53-365 Eisenhower Drive By and Between the La Quinta Redevelopment Agency and Francisco and Margery Moreno RECOMMENDATION: AGENDA CATEGORY: BUSINESS SESSION: CONSENT CALENDAR: STUDY SESSION: PUBLIC HEARING: Approve the sale of the single-family home located at 53-365 Eisenhower Drive to Francisco and Margery Moreno for a purchase price of $165,000, and authorize the Executive Director to execute the necessary documents. FISCAL IMPLICATIONS: The Agency will receive approximately $95,000 from sale proceeds and will fund a $70,000 silent second trust deed loan; funding the second trust deed loan will insure that the dwelling is affordable to a very low-income household. BACKGROUND AND OVERVIEW: In August, 1995, the Agency acquired 50 single-family homes in the Cove to remove them from bankruptcy proceedings filed by the then owner, Coachella Valley Land. Known as the La Quinta Rental Housing Program, these dwellings were rented to very low-income Section 8 households. In February 1998, the Agency directed staff to sell two units per year first to qualified tenants, and second, to other eligible very low-income households. Since 1998, the Agency has also been substantially rehabilitating these units in order to count them towards the Agency's affordable housing production requirements. State law requires existing dwellings be substantially rehabilitated (wherein the rehabilitation costs are 25 % or greater of current market value) in order to count them as part of the Agency's affordable housing production efforts. Property rehabilitation costs have been funded from rental income. S:\CityMgr\STAFF REPORTS ONLY\PH 1 RDA house sale.doc When the Agency initiated relocation activities at the Vista Dunes Mobile Home Park, staff began working with interested Park residents who could qualify for first trust deed mortgage loans to purchase homes that were in the Rental Housing Program or featured an Agency sponsored silent second trust deed mortgage. The Rental Housing Program property manager and/or local realtors (in the case of homes with silent second trust deed mortgages) continually contact staff when Rental Housing Program homes are vacant, or when Agency second trust deed mortgage homes are offered for sale. Mr. and Mrs. Moreno are Vista Dunes residents who expressed interest in purchasing a home. A Rental Housing Program home was available and the Morenos subsequently qualified for a first trust deed mortgage loan. The sale transaction would be structured wherein an Agency silent second trust deed mortgage would cover the difference between the sales price, and the down payment and an affordable first trust deed mortgage. If this sale is authorized, the unit will be sold for $165,000 with the buyer funding a 20% or $33,000 down payment, and a private lender originating a $62,000 first trust deed mortgage (the maximum loan the homebuyer can obtain and have overall housing costs affordable to a very low-income household). The Agency would convert $70,000 of its equity into a silent second trust deed loan. This sale would be the 17th Rental Housing Program unit to be sold; ten were sold to existing tenants, and seven to non -tenant households. Attachment 1 is a Summary Report that further details this transaction. Pursuant to the Redevelopment Law, a joint public hearing of the City Council and Agency Board must be held prior to approving the sale of Agency property purchased with tax increment revenue. FINDINGS AND ALTERNATIVES: Alternatives available to the Redevelopment Agency include: 1. Approve the sale of the single-family home located at 53-365 Eisenhower Drive to Francisco and Margery Moreno for a purchase price of $165,000, and authorize the Executive Director to execute the necessary documents; or 2. Do not approve the sale of the single-family home located at 53-365 Eisenhower Drive to Francisco and Margery Moreno for a purchase price of $165,000, and do not authorize the Executive Director to execute the necessary documents; or 3. Provide staff with an alternative direction. 2 S:\CityMgr\STAFF REPORTS ONLY\PH 1 RDA house sale.doc Respectfully submitted, DAcrEdWns Community Development Director Approved for submission by: Thomas P. Genovese, Executive Director Attachment: 1. Summary Report K S:\CityMgr\STAFF REPORTS ONLY\PH 1 RDA house sale.doc ATTACHMENT #1 SUMMARY REPORT FOR THE PROPOSED RESIDENTIAL HOME SALE AGREEMENT BETWEEN THE LA QUINTA REDEVELOPMENT AGENCY AND FRANCISCO AND MARGERY MORENO March 1, 2005 INTRODUCTION This document is the Summary Report ("Report") for the proposed Sale Agreement ("Agreement") between the La Quinta Redevelopment Agency ("Agency") and Francisco and Margery Moreno ("Buyers"). The Agreement facilitates the sale of an Agency single-family dwelling to the Buyer. This Report has been prepared pursuant to Section 33433 of the California Health and Safety Code (California Community Redevelopment Law) and presents the following: • A summary of the proposed transaction. • The cost of the sale to the Agency. • The estimated value of the interest to be conveyed, determined at the highest and best uses permitted by the Agency's Redevelopment Plan. • The estimated value to be conveyed, determined by the use and with the conditions, covenants, and development costs required by the Agreement. • An explanation of why the sale, pursuant to the Agreement, will assist in the elimination of blight. The Subject Property The home is a vacant 3-bedroom 2-bath single-family dwelling located at 53-365 Eisenhower Drive within La Quinta Redevelopment Project Area No. 1 ("Property"). In August, 1995, the Agency acquired 50 single family homes to remove them from bankruptcy proceedings filed by the then owner, Coachella Valley Land. Known as the La Quinta Rental Housing Program, these dwellings were rented to very low income Section 8 households. In February 1998, the Agency directed staff to sell two units per year first to qualified tenants, and second, to other eligible very low income households. Since 1998, the Agency has also been substantially rehabilitating these units in order to count them towards that Agency's affordable housing production requirements. State law requires that an existing dwelling be substantially rehabilitated (wherein the rehabilitation costs are 4 25 % or greater than current market value) in order to count them as part of the Agency's affordable housing production efforts. Property rehabilitation costs have been funded from rental income. The existing tenant recently vacated the property and per Agency policy, staff initiated the sale of this unit to a very low income household. A SUMMARY OF THE PROPOSED TRANSACTION The Agency is in the process of relocating residents from the Vista Dunes Mobile Home Park. The Buyer, a Vista Dunes resident who was being relocated, expressed interest in purchasing a home in La Quinta and subsequently qualified for a first trust deed loan. The Agreement facilitates the sale of the Property to the Buyer, who will occupy the dwelling. The $165,000 sales price will be funded through a combination of the Buyer's $33,000 down payment, a $62,000 first trust deed mortgage, and $70,000 of the Agency's equity that will be converted into a silent second trust deed loan. This second trust deed loan will include covenants to insure that the Property will remain affordable to very low income - household for 45 years. THE COST OF THE SALE TO THE AGENCY The Agency has invested $127,750 in the Property through a combination of the $86,500 initial purchase cost and $41,250 of expenses related to substantially rehabilitating the dwelling. Since 1998, the Agency has been substantially rehabilitating the Rental Housing Program units in order to count them towards the Agency's affordable housing production requirements. State law requires that existing dwellings be substantially rehabilitated (wherein the rehabilitation costs are 25 % or greater than current market value) in order to count them as part of the Agency's affordable housing production efforts. Property rehabilitation costs were funded from rental income. Per the Agreement the Agency will sell the Property for $165,000; of this amount the Agency will receive $95,000 in sale proceeds and convert $70,000 of its equity into a silent second trust deed mortgage loan of $70,000 in order to insure that the annual costs are affordable to very low income households. The Agency will recover 74% of its investment to date from the sale proceeds. ESTIMATED VALUE OF THE INTEREST TO BE CONVEYED AT THE HIGHEST AND BEST USES PERMITTED BY THE AGENCY'S REDEVELOPMENT PLAN The Redevelopment Plan for La Quinta Redevelopment Project No. 1 provides that the Property shall be used for low -density residential development. Current residential property sales for like dwellings in the Cove market area indicate values 5 P:\Reports - CC\2005\3-3-05\RDA House sale\Summary report.doc of $210,000 to $225,000 for three bedroom, two bath single family dwellings in good condition. ESTIMATED VALUE OF THE INTEREST TO BE CONVEYED DETERMINED BY THE USE, AND WITH THE CONDITIONS, COVENANTS The Agreement provides that the Property will be sold for $165,000. This value was selected in order to facilitate the sale at a cost affordable to a very low income household. EXPLANATION OF WHY THE SALE OF THE PROPERTY PURSUANT TO THE AGREEMENT WILL ASSIST IN THE ELIMINATION OF BLIGHT The Agreement does not eliminate blight in that it does not facilitate a transaction that remedies blight. Instead the Agreement expands the supply of affordable ownership housing in the Project Area. Prior to the sale, the Agency substantially rehabilitated the Property to extend the Property's economic life, to reduce the maintenance burdens for the family that will occupy this unit, and to improve operating efficiencies by installing low water landscaping and efficient heating, air conditioning and water heating devices. The Agreement includes covenants that require the dwelling to remain affordable to very low income households for a 45 year period. This effort not only preserved housing that was affordable to very low income households but will also insure that this dwelling remains affordable for the longest feasible time. P:\Reports - CC\2005\3-3-05\RDA House sale\Summary report.doc