1997 09 23 RDA78-495 CALLE TAMPICO — LA QUINTA, CALIFORNIA 92253 - (760) 777-7000
FAX (760) 777-7101
TDD (760) 777-1227
NOTICE OF SPECIAL MEETING
OF THE
LA QUINTA REDEVELOPMENT AGENCY
TUESDAY, SEPTEMBER 23, 1997
1:30 PM
NOTICE IS HEREBY GIVEN THAT IN ACCORDANCE WITH GOVERNMENT CODE SECTION
54956, 1, STANLEY L. SNIFF, CHAIRMAN OF THE LA QUINTA REDEVELOPMENT AGENCY,
DO HEREBY CALL A SPECIAL MEETING OF THE LA QUINTA REDEVELOPMENT AGENCY FOR
1:30 PM ON TUESDAY, SEPTEMBER 23, 1997. SAID MEETING WILL BE HELD IN THE LA
QUINTA CITY COUNCIL CHAMBER, 78-495 CALLE TAMPICO, LA QUINTA, CALIFORNIA.
PURPOSE OF SAID MEETING IS AS DELINEATED ON THE ATTACHED AGENDA.
Dated: September 19, 1997
STANLEY L. SNIFF, C airman
La Quinta Redevelopment Agency
DECLARATION OF POSTING
1, Saundra L. Juhola, Secretary of the La Quinta Redevelopment Agency, do hereby declare that the
foregoing notice for the Special Redevelopment Agency meeting of September 23, 1997 was posted
on the outside entry to the Council Chamber, 78-495 Calle Tampico and on the bulletin board at the
La Quinta Chamber of Commerce and faxed to the news media on Friday, September 19, 1997.
Datqq: September 19, 1997
SAUNDRA L. JUHOLA, Secretary
La Quinta Redevelopment Agency
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MAILING ADDRESS - P.O. BOX 1504 - LA QUINTA, CALIFORNIA 92253
OF
La Quinta
Redevelopment Agency
Agenda
City Council Chamber
78-495 Calle Tampico
La Quinta, California 92253
Special Meeting
September 23, 1997 - 1:30 PM
CALL TO ORDER
a. Pledge of Allegiance
b. Roll Call
PUBLIC COMMENT
CONFIRMATION OF AGENDA
BUSINESS SESSION - None
Beginning Reso. No. 97-
I
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STUDY SESSION
DISCUSSION REGARDING STATUS OF AGENCY AFFORDABLE HOUSING PROGRAMS.
CLOSED SESSION
1 CONFERENCE WITH LEGAL COUNSEL PURSUANT TO GOVERNMENT CODE SECTION
54956.9(a) REGARDING EXISTING LITIGATION; LA QUINTA REDEVELOPMENT AGENCY V.
DIEHL EVANS & COMPANY, CASE NO. 782308; CITY OF ORANGE V. ALABAMA
TREASURY ADVISORY PROGRAM, CASE NO. BC 106461; REFCO, CASE NO. CV92-
7626RJK.
2. CONFERENCE WITH LEGAL COUNSEL PURSUANT TO GOVERNMENT CODE SECTION
54956.9(b)3(E) REGARDING POTENTIAL LITIGATION (ONE CASE)
ADJOURNMENT
DECLARATION OF POSTING
1, Saundra L. Juhola, City Clerk of the City of La Quinta, California, do hereby certify that
the foregoing agenda for the Special City Council Meeting of September 23, 1997 was
posted on the outside entry to the Council Chamber, 78-495 Calle Tampico and on the
bulletin board at the La Quinta Chamber of Commerce on Friday, September 19, 1997.
Datqq: September 19, 1997
§AUNDRA L. JUHOLA, City Clerk
City of La Quinta, California
PUBLIC NOTICE
The La Quinta City Council is handicapped accessible. If special equipment is needed for
the hearing impaired, please call the City Clerk's Office at 777-7025, 24-hours in advance
of the meeting and accommodations will be made.
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a
4 4a Qum&
AGENDA CATEGORY:
BUSINESS SESSION:
COUNCIL/RDA MEETING DATE: September 23, 1997 CONSENT CALENDAR:
ITEM TITLE:
STUDY SESSION:
Discussion of the status of the Agency's Affordable PUBLIC HEARING:
House Programs
RECOMMENDATION:
That the Agency Board: (1) review and provide comment on the Agency's affordable housing
efforts to date, (2) provide staff direction on establishing a housing authority in order to facilitate
continued ownership of the La Quinta Rental Housing Program (LQRHP) units, (3 )) provide staff
direction on investing up to $200,000 in order to refurbish some of the LQRHP units, and (4)
provide staff direction on the purchase, rehabilitation, and resale of two dilapidated Cove single-
family dwellings.
FISCAL IMPLICATIONS:
None.
BACKGROUND AND OVERVIEW
As part of the Agency's overall redevelopment program, the Agency must ensure that there is a
sufficient supply of housing opportunities affordable to very low, low, and moderate income
households in both Project Area No. I and No. 2. To accomplish this, the California Redevelopment
Law requires:
C011.006
tax increment revenue allocation: the Agency invest at least 20% of the annual tax increment
revenue receipts in efforts that increase and improve the supply of affordable housing in both
Project Areas, and
affordable housing production: the Agency insure that at least 15% of all private sector
developed or substantially rehabilitated dwelling units and at least 30% of all Agency
developed or substantially rehabilitated units, within both Project Areas, be affordable to
very low, low, and moderate income households; this requirement commenced when the
Project Areas were adopted (1983 for No. I and 1989 for No. 2) and continues for the
duration of the Project Areas.
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The latter requirement includes the mandate that these units remain affordable for the life of the
Redevelopment Plans (26 years for No. I and _3 )2 years for No. 2), and that covenants be recorded
to maintain each unit's continued affordability. In 1994, the Agency embarked on a program to
facilitate affordable housing production; this study session is designed to update the Agency Board
on the progress to date and seek direction regarding certain program policy issues.
Housing Production Plan
In 1994, the Redevelopment Law was modified to require that the Agency adopt a I 0-year plan that
projects how the Agency will achieve the mandated housing production requirements. The Law
further requires that the housing plan be updated when the Agency's Five -Year Implementation
Plans for both Project Areas are reviewed 2/2years after their adoption. Staff proposes to hold the
required Implementation Plan Public Hearing on October 21, 1997. In advance of that hearing, staff
presents the following data regarding housing production activities for Agency consideration.
The 1994 housing production plan projected a need for 1,579 covenant restricted affordable units
by the year 2004; of these, 632 units must be affordable to very low income households and 947
units must be affordable to low to moderate income households. Since 1994, the Agency has
invested $10.3 million in affordable housing production efforts involving I Agency, I non-profit,
and 4 private housing programs, These programs have produced a total of 218 covenant restricted
units (at an average cost of $47,247 per unit) of which 162 are affordable to very low income
households and 56 are affordable to low and moderate income households. As presented on Table
I of this report, the Agency has a remaining projected housing production need of 1,361 units - 470
very low income and 891 low and moderate income. Table 2 identifies existing affordable housing
programs/projects that will address part of this need. Depending on the outcome of land acquisition
discussions with both Desert Sands Unified School District and Mr. Bienek, the two properties the
Agency purchased for affordable housing (48" Avenue and Adams Street, Miles Avenue and
Washington Street) may yield an additional 80 to 120 units. Accounting for these future units would
leave a housing production deficit in 2004 of 845 to 885 units.
Housing Authorily
In July 1995, the Agency purchased 50 single-family homes in the Cove as a result of Coachella
Valley Land's bankruptcy action in order to preserve a $1.0 million Agency investment. Sincethat
time, one unit was sold and the remaining 49 units comprise the La Quinta Rental Housing Program.
These units are rented to very low income households that receive Section 8 rental assistance from
the County of Riverside, and are currently managed by La Quinta Real Estate who is under contract
with the Agency to provide property management services. The properties have a low vacancy rate
due to the shortage of Section 8 units, and since the County pays a significant portion of the monthly
rental cost, delinquent rents are minimal. The properties generate $20,000 in net monthly income;
as of July 1997, the LQRHP generated a total of $410,000 in net rental income.
CCJH.006 000005
When the units were purchased, the initial Agency policy was to continue renting them until the
Cove residential resale market stabilized. Unfortunately, Cove real estate values have declined and
market conditions have not been favorable to sell the units. The Redevelopment Law restricts the
Agency from owning real property for an extended period of time and if the Agency would elect to
retain these units as rental dwellings, then it would be appropriate to establish a housing authority.
There are two forms of housing authorities the Agency could consider. The first involves
establishing a separate entity that could involve a combination of City Council members and renters
serving as the governing body; the second would involve reconstituting the Redevelopment Agency
as a Community Development Commission which would provide the existing Redevelopment
Agency both redevelopment and housing authority powers. If the Agency would elect to pursue a
housing authority, additional City Council and Agency actions would be scheduled for upcoming
meetings.
LQRHP Maintenance
The LQRHP homes were constructed in 1988 and have always been rental units; therefore, pride of
ownership has not been a constant motivation for ongoing maintenance. The properties are in need
of both interior and exterior improvements in order to maintain a standard of unit maintenance that
will enhance surrounding properties. In July 1997, the units were inspected by La Quinta Real
Estate and RSG to document existing interior and exterior conditions; the property maintenance
contractor that currently services the units provided the improvement cost estimates. Table 3 of this
report presents the recommended rehabilitation needs. Exterior items include stucco repair, paint,
door replacement, and landscaping improvements. Interior improvements include paint, new carpets,
appliance repair/replacement, and new flooring. A total of $200,000 of improvement costs were
identified. Staff proposes that the Agency consider authorizing these improvements, with funding
being derived from the surplus rental income.
Unit Purchase/Rehabilitation/Resale
In February 1997, the Agency adopted the La Quinta Housing Program that funded:
silent second trust deed mortgages,
rehabilitation loans of up to $25,000 per unit, and
the purchase of dilapidated single-family dwellings which would then be rehabilitated
and sold to low income households.
The second trust deed mortgage program has been very successful; since April 1997, a total of 29
mortgages have been funded. Staff is finalizing the logistics for the rehabilitation loans, and will
be circulating loan availability letters within the next 30 days. The final component is the purchase,
rehabilitation, and sale of dilapidated units. The Agency elected to pursue this component in order
to both improve the City's housing stock and facilitate the sale of covenant restricted units. RSG,
with the assistance of staff and the local real estate community, has identified 9 units for Agency
CCJH.006
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consideration. Table 4 delineates the units staff desires the Agency to consider; during the study
session, a slide of each of these units will be presented. The selection criteria RSG used was: the
units were existing for sale dwellings with emphasis placed upon obtaining HUD repossessed units,
the asking price was $50,000 to $70,000, the units are one of the most dilapidated units in the
neighborhood, and their improvement would have a significant beneficial impact on surrounding
homes. Preliminary per -unit rehabilitation estimates range from $25,000 to $40,000 per unit. If the
Agency directs staff to proceed with this effort, then staff will work with Building Horizons and the
local contracting community to gain the most cost effective means for unit rehabilitation. Further,
staff will need to obtain formal Agency authorization to purchase one or more of these units at a
subsequent Agency meeting.
FINDINGS AND ALTERNATIVES:
Agency staff has presented this information at a Study Session in order to gain Agency Board input
and direction and will subse4uently be agendizing these items for formal consideration. Staff is
seeking Board Member input on the following:
* General comments and direction on the housing production efforts to date.
0 Direction on forming a housing authority.
0 Direction on expending funds to rehabilitate the LQRHP units.
0 Direction on the purchase, rehabilitation, and sale of dilapidated units.
Hermqn
iunity Development Director
CCJH.(H)6 000007
TABLE 1
La Quinta Redevelopment Agency
Affordable Housing Progress Report
Projection through 2003-04
based on 1994 Plan's 10 Year Projection
Projected Unit Production
Actual New / Rehabilitated Units (Adoption to 1994)
Projected New / Rehabilitated Units (1994 to 2004)
Estimated Unit Production
Project Area 1 Project Area 2
(Adopted 1983) (Adopted 1989) Total
3,824 904 4,728
3,453 2,346 5,799
7,277 3,250 10,527
Unit Requirement - both Project Areas combined
Total New or Rehabilitated Units Produced 10,527
% Required to be Affordable 15%
Units Required to be Affordable 1,579
% Required to be Affordable to Very Low Income Persons/Families 40%
Units Required to be Affordable to Very Low Income Persons/Fami lies 632
Balance of Units for Low and Moderate Income Persons/ Families 947
Units Required to be Affordable 1,579
Progress Towards Meeting Plan's 10 Year (2003-04) Production Goals
Low to
Very Low
Moderate
Total
Units Required
632
947
1,579
Units Produced through 9-23-97
Coachella Valley Housing Coalition
5
5
10
Stockman Development
9
5
14
Building Horizons
0
6
6
Williams Development
96
14
110
La Quinta Rental Housing
49
0
49
La Quinta Housing Program
3
26
29
Total Units Produced
162
56
218
Housing Unit Credit / (Deficit)
(470)
(891)
(1,361)
Annualized over next 7 years
(67)
(127)
(194)
10 Yr.
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TABLE2
La Quinta Redevelopment Agency
Affordable Housing Progress Report
Future Projects and Programs to Meet 2003-04 Goals
Projected Unit Requirement - 1997-98 through 2003-04
Low to
Very Low Moderate Total
Housing Unit Credit/ (Deficit) (470) (891) (1,361)
Projected Units from Future Projects and Programs
Low to
Projects Very Low Moderate Total
Catellus Residential Development 75 125 200
Avenue 48 Housing ? ? ?
Miles Avenue Housing ? ? ?
Total Units from Housing Projects 75 125 200
Programs
*La Quinta Housing Program
- 2nd Trust Deed Purchase (18 per year) 50 76 126
- Agency Purchase/Rehab/Resale (3 per year) 8 13 21
La Quinta Rental Housing 49 0 49
Total Units from Programs 108 88 196
Total Units from Projects & Programs 183 213 396
*Also includes rental rehabilitation component, but does not include long term affordability covenants.
Future Progress Towards Meeting 10 Year (2003-04) Production Goals
Low to
RAnciarnfa Tnfni
Housing Unit Credit/ (Deficit) (287) (678) (965)
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7 Yr. Future
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TABLE3
La Quinta Redevelopment Agency
Affordable Housing Progress Report
La Quinta Rental and Resale Housing
Proposed Rehabilitation
La Quinta Rental Housing
Type
# Units
Itemization Total
Exterior Improvements
Patch/Repaint Stucco & Trim
9
13,500
Repaint Trim
40
20,000
Repair /replace garage doors, clean driveway stains/
15
6,300
repair fences
Replace / refurbish existing front yard landscaping
49
98,000
Total Exterior Improvements
137,800
Interior Improvements
Recarpet
19
28,500
Repaint Interiors ($1,000 Average)
20
20,000
Kitchen upgrades, replace appliances, repair damaged
14
2,850
counter tops, replace flooring
Replace bathroom vinyl flooring
17
3,400
Total Interior Improvements
54,750
Total Rehabilitation Estimate 192,550
Funds Availability
7-31-97 Fund Balance 410,000
Rental Income to 12-31-97 net of operating expenses $20,000 Monthly 100,000
Projected 12-31-97 Available Funds 510,000
Proposed Rehabilitation Expenditure 192,550
Remaining Funds after Rehabilitation 317,450
LQHP - Rental
97wkshp2 9/18/97 00001161
TABLE4
La Quinta Redevelopment Agency
Affordable Housing Progress Report
La Quinta Housing Program
Agency Purchase / Rehab / Resale Component
Potential Acquisition Units & Costs
Listing Price
1.
52-020 Ave. Velasco
52,900
2.
52-165 Ave. Velasco
54,900
3.
52-050 Ave. Cortez
59,000
4.
52-120 Ave. Carranza
59,900
5.
52-691 Ave. Mendoza
62,900
6.
53-125 Ave. Rubio
64,900
7.
52-640 Ave. Martinez
69,900
8.
52-575 Eisenhower
51,000
9�
52-615 Eisenhower
59,000
10.
53-612 Eisenhower
50,000
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LQHP - Agency
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