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RDA Resolution 2011-026RESOLUTION NO. RA 2011 - 026 A RESOLUTION OF THE LA OUINTA REDEVELOPMENT AGENCY ADOPTING A REPLACEMENT HOUSING PLAN FOR 78181 AND 78182 AVENIDA LA FONDA AND 78153 MAIN STREET WHEREAS, the La Quinta Redevelopment Agency ("Agency") is a public body, corporate and politic, organized and existing under the California Community Redevelopment Law (Health & Safety Code Section 33000 et seq.) ("Law"); and WHEREAS, the City Council of the City of La Quinta ("City Council") approved and adopted the Redevelopment Plan for Redevelopment Project No. 1 ("Redevelopment Plan"), by Ordinance No. 43 on November 29, 1983, as amended by Ordinance No. 258 on December 20, 1994, Ordinance No. 264 on March 21, 1995, Ordinance No. 388 on August 19, 2003 and Ordinance No. 402 on March 16, 2004; and WHEREAS, the Agency has entered into Purchase and Sale Agreements with Thomas H. Casey, Chapter 7 Bankruptcy Trustee for 78181 Avenida La Fonda (APN 770-125-003), Michael A. Fischer for 78182 Avenida La Fonda (APN 770- 124-007) and Yessayian Family Ltd. Partnership for 78153 Main Street (APN 770- 124-004) ("Properties") respectively, for the purposes of implementing the Redevelopment Plan which would result in the removal of 11 low and moderate income units; and WHEREAS, Section 33413 of the Law requires that whenever dwelling units housing persons and families of extremely low, very low, low-, or moderate -income are destroyed or removed from the low and moderate income housing market as part of a redevelopment project subject to a written agreement with the Agency, the Agency shall, within four (4) years of such destruction or removal, rehabilitate, develop or construct, or cause to be rehabilitated, developed or constructed, for sale or for rent, an equal number of replacement dwelling units with an equal or greater number of bedrooms as those units destroyed or removed, within the Agency's territorial jurisdiction; and WHEREAS, Section 33413 of the Law also requires that 100 percent of the replacement dwelling units be affordable to persons and families of the same or lower income category as those households displaced from the destroyed or removed units; and WHEREAS, Section 33413.5 of the Law requires that the Agency adopt a Replacement Housing Plan prior to executing an agreement for the acquisition or the disposition and development of real property, or to executing an owner participation agreement, when any such agreement would lead to the destruction Resolution No. RA 2011-026 Adopting the Replacement Housing Plan for 78181 & 78182 Avenida La Fonda and 78153 Main Street Adopted: June 21, 2011 Page 2 or removal of dwelling units from the low- and moderate -income housing market, to address specific issues related to the replacement of those dwelling units housing low and moderate income persons and families to be destroyed or removed as a result; and WHEREAS, the Agency has prepared a Replacement Housing Plan in accordance with Section 33413.5 of the Law; and WHEREAS, a draft of the. Replacement Housing,Plan was made available for public review and comments a reasonable time prior to the'Agency considering the Replacement Housing Plan for adoption. NOW, THEREFORE, THE LA QUINTA REDEVELOPMENT AGENCY DOES HEREBY RESOLVE, ORDER, AND DETERMINE AS FOLLOWS: Section 1. The Replacement Housing Plan, a copy of which has been presented to the Redevelopment Agency and is now on file with the City Clerk, is hereby approved. Section 2. The Agency Secretary shall certify as to the adoption of this resolution. PASSED, APPROVED, AND ADOPTED at a regular meeting of the La Quinta Redevelopment Agency held this 21st day of June, 2011, by the following vote, to wit: AYES: Agency Members Adolph, Evans, Franklin, Sniff, Chair Henderson NOES: None ABSENT: None ABSTAIN: None TERRY DE SON, Chair La Quin Redevelopment Agency Resolution No. RA 2011-026 Adopting the Replacement Housing Plan for 78181 & 78182 Avenida La Fonda and 78153 Main Street Adopted: June 21, 2011 Page 3 n Secretary _ La Quinta ReOvelopment Agency (AGENCY SEAL) APROVED AS TO FORM: ." Ik KATHERINE JENSON Agency Counsel La Quinta Redevelopment Agency LA QUINTA REDEVELOPMENT AGENCY 78495 CALLE TAMPICO LA QUINTA, CA 92253 REPLACEMENT HOUSING PLAN 78181 AVENIDA LA FONDA 78182 AVENIDA LA FONDA 78163 MAIN STREET La Quinta Redevelopment Agency June 21, 2011 ROSENOW SPEVACEK GROUP, INC. www.webrsg.com REPLACEMENT HOUSING PLAN 78181 AVENIDA LA FONDA 78182 AVENIDA LA FONDA 78153 MAIN STREET LA QUINTA REDEVELOPMENT AGENCY INTRODUCTION..............................................................................................................................1 ReplacementHousing Plan..............................................................................................................1 Replacement Housing Plan Requirements.......................................................................................1 EXISTING CONDITIONS AND REDEVELOPMENT PROJECT.......................................................2 TheProperties..................................................................................................................................2 The Redevelopment Project.............................................................................................................2 LOCATION, TIMING, AND FINANCING OF REPLACEMENT HOUSING........................................2 Replacement Housing Obligations....................................................................................................3 Replacement Housing Development.................................................................................................3 Timetable for Replacement Housing Development...........................................................................4 Means of Financing the Replacement Housing Obligations..............................................................4 Article XXXIV of the California Constitution Requirements................................................................4 RSG REPLACEMENT HOUSING PLAN 78181 AVENIDA LA FONDA 78182 AVENIDA LA FONDA 78153 MAIN STREET LA QUINTA REDEVELOPMENT AGENCY INTRODUCTION The La Quinta Redevelopment Agency ("Agency") is acquiring 78181 and 78182 Avenida La Fonda, and 78153 Main Street ("Properties") in the La Quinta Village. These Properties, along with the adjacent vacant properties the Agency currently owns, would facilitate redevelopment in the La Quinta Village, including public improvements and facilities, mixed -use development, and affordable housing. Specific project details are not known at this time. The Properties are located in Redevelopment Project Area No. 1 on Avenida La Fonda and Main Street, east of Desert Club Drive, and are improved with two four-plexes and one five-plex that house a total of 11 rental units that have been issued certificates of occupancy and available for lawful residential use. Eight of these units are currently being rented to and occupied and three of these units are available for rental occupancy by low and moderate income households. Due to the dilapidated condition of these properties, the Agency anticipates relocating the current residents and demolishing the Properties within the next several months. Replacement Housing Plan This document is the Replacement Housing Plan ("Plan") for the Properties, and serves as the baseline for compliance with Health & Safety Code Section 33413(a) and Section 33413(f) of California Community Redevelopment Law, Health and Safety Code Section 33000 at seq. ("Law") as described in the following sections. Replacement housing obligations are tied to formulas for matching lost units according to income category, and total bedroom count on a one -for -one basis. Countable replacement housing units must be within the Agency's territorial jurisdiction, in standard condition, and for rental units, designed to remain affordable to low and moderate income households for no less than 55 years. In addition to addressing the legally required items, this Plan also documents the existing conditions at the Properties in order to define its replacement housing obligations. Replacement Housing Plan Requirements Pursuant to the Law, when an agency assists a project that causes the removal or displacement of affordable housing units, it is required to provide for the replacement of those units. Specifically, the agency must provide an equal number of replacement dwelling units that have an equal or greater number of bedrooms as the displaced or removed units. In addition, for rental units, the replacement dwellings must be available at a rent affordable to, and occupied by, persons in the same or.lower income category as the displaced units. The agency must replace the units within four years of their removal or displacement. Eitght units at the Properties are occupied at extremely low, low, or moderate income rents, as shown in Table 1. For the purposes of this Plan, it is assumed that the three vacant units would be rented at equivalent rents as those currently occupied.2 Therefore, as the Agency will be removing 11 rental units affordable to extremely low, low, and moderate income households, the Law requires the Agency to prepare this Plan that details how the Agency will replace the 11 rental units within a four year period. Section 33413.5 of the Law requires that this Plan address the following: • The general location of housing to be rehabilitated, developed, or constructed to serve as the replacement units for the current 11 rental units; • The number of dwelling units housing persons and families of extremely low, very low, low, or moderate income planned for construction or rehabilitation; Based upon the income limits set forth by the Department of Housing and Community Development 2 The property located at 78181 Avenida La Fonda has plans that have approved three additional rental units, but those units do not have certificates of occupancy and have not been available for lawful occupancy. Therefore, no replacement nits are required for these three units. RSG REPLACEMENT HOUSING PLAN 78181 AVENIDA LA FONDA 78182 AVENIDA LA FONDA 78163 MAIN STREET LA QUINTA REDEVELOPMENT AGENCY • The timetable for meeting the replacement housing plan's relocation, rehabilitation, and replacement housing obligations; • A description of the means of financing such rehabilitation, development or construction; and • A finding that the replacement housing does or will not require voter approval pursuant to Article XXXIV of the California Constitution, or that such approval has been obtained. EXISTING CONDITIONS AND REDEVELOPMENT PROJECT This section presents the data that was used in developing this Plan. It details the type of units that will be removed, and the household income levels the units serve. The Properties The Properties are located in the La Quinta Village on Avenida La Fonda and Main Street, in La Quinta Redevelopment Project No. 1. The Properties are improved with four- and five-plexes that house a total of 11 studio units for rent. 78181 Avenida La Fonda ("La Fonda Five Plex") — the Agency entered into escrow to purchase this property on May 26, 2011. The parcel is approximately 16,000 square feet, is Assessor Parcel Number 770-125-003, and is located on the south side of Avenida La Fonda, across from the La Fonda Four Plex. 78182 Avenida La Fonda ("La Fonda Four Plex") — this property was purchased by the Agency on May 27, 2011. The parcel is approximately 12,400 square feet, is Assessor Parcel Number 770-124- 007, and is located on the north side of Avenida La Fonda between Desert Club Drive and Main Street. 78153 Main Street ("Main Street Five Plex") — the Agency entered into escrow to purchase this property on May 26, 2011. The parcel is approximately 13,700 square feet, is Assessor Parcel Number 770-124-004, and is located on the south side of Main Street, just east of Desert Club Drive. The total number of units by bedroom and affordability count is as follows: Units Being Removed Table I Extremely Studio Units 1 The Redevelopment Protect The Agency is acquiring the Properties for the purpose of consolidating them with adjacent vacant properties the Agency currently owns, to continue implementation of redevelopment activities within the La Quinta Village, including a mixed -use development, library and senior center expansion and parking, and affordable housing development. Details regarding a specific development project are not available at this time. LOCATION, TIMING, AND FINANCING OF REPLACEMENT HOUSING The Agency has been aggressively implementing the affordable housing mandates prescribed by the Law. To date, the Agency has secured 1,059 units with affordability covenants. Through the Washington Street (q RSG REPLACEMENT HOUSING PLAN 78181 AVENIDA LA FONDA 78182 AVENIDA LA FONDA 78163 MAIN STREET LA QUINTA REDEVELOPMENT AGENCY Apartments Project and Home Purchase and Rehabilitation Program described below, the Agency will be able to meet the replacement housing obligations generated by removal of units at the Properties. Replacement Housing Obligations Pursuant to the Law, the Agency must replace 100% of the number of destroyed or removed affordable units at an affordable housing cost to persons in the same or lower income category as those of the persons displaced. The Agency may satisfy its replacement housing obligation, however, with a fewer number of units if the replacement program meets both of the following criteria: (1) the total number of bedrooms in the replacement units equals or exceeds the number of bedrooms in the destroyed or removed units, and (2) the replacement units are affordable to the same or lower income categories as those persons displaced from the destroyed or removed units. The Agency will be implementing these provisions to satisfy the replacement housing obligation, thereby generating an equal amount of replacement bedrooms to those removed, at income levels at or lower than the persons to be displaced. Replacement Housing Development The Agency intends to satisfy the replacement housing obligations through two separate housing developments in La Quints Redevelopment Project Area Nos. 1 and 2. The two developments are as follows: Home Purchase and Rehabilitation Program Through the Home Purchase and Rehabilitation Program the Agency has been acquiring vacant foreclosed single-family homes and rehabilitating the homes for rent or sale to very low, low, or moderate income families. The Agency is currently rehabilitating three three -bedroom single family homes in Project Area No. 1. These homes will have either 45- or 55-year affordable covenants depending on whether they are sold or rented to eligible low and moderate income households. The Home Purchase and Rehabilitation Program will satisfy a portion of the replacement housing obligations generated by the Properties: units will be affordable to persons in the same or lower income category, and the units will have an equal or greater number bedrooms as those removed. Washington Street Apartments The Agency will be substantially rehabilitating and constructing 98 one -bedroom units at 42800 Washington Street; 96 of the dwellings will be at rents affordable to extremely low and very low income seniors and disabled households, and 2 of the dwellings will be affordable to moderate income households (the manager and on -site maintenance personnel units). The Washington Street Apartments will satisfy a portion of the replacement housing obligations generated by the Properties: units will be affordable to persons in the same or lower income category, and the units will have an equal or greater number bedrooms as those removed. Table 2 below presents the replacement housing obligations and the number of units the Washington Street Apartments and Home Purchase and Rehabilitation Program will generate. (am REPLACEMENT HOUSING PLAN 78181 AVENIDA LA FONDA 78182 AVENIDA LA FONDA 78153 MAIN STREET LA QUINTA REDEVELOPMENT AGENCY Replacement Unbe Table 2 Project Area Unlb Proposed to be Removed 78181 Avenida La Fonda 1 78182 Avenida La Fonda 1 78153 Main Street 1 Total Replacement II .. Home Purchase and Rehabilitation Programo 1 Washmaton Street Apartments 2 Total r Units removed are studio units UnOs - eedroo Extremely tMemely Low Very Low Low Moderate Low Very Low Low Moderate Total Income Income Income Income Total Income Income Income Income 2 0 - 0 0 2 2 0 0 0 2 4 0 0 0 4 4 0 0 0 4 5 - 1 4 0 0 5 1 4 0 0 11 1 4' 0 6 -11 1 1 0 6 3 0 3 0 0 9 0 9 0 0 2 1 1 0 0 2 1 1 0 0 5 1 4 0 0 11 1 10 0 0 z Per Section 33413(a) of the Law removed units may be replaced with a greater number of bedrooms and affordable to persons in the same or lower income category ' Includes53645 Avenida Navano,52681 Avenida Mendoza. and 52050 Avenida Carranza Timetable for Replacement Housina Development The rehabilitation of the three three -bedroom residences for the Home Purchase and Rehabilitation Program began at different times, between January and May 2011, and are anticipated to be completed by December 2011. Rehabilitation and construction of the Washington Street Apartments is expected to begin in April 2013, with anticipated completion in March 2014. Means of Financing the Replacement Housing Obligations The replacement housing obligations will be funded from the Agency's Low and Moderate Income Housing Fund. Article XXXIV of the California Constitution Requirements Article XXXIV of the California Constitution provides that no low -rent housing project may be developed, constructed, or acquired by a state public body without the majority of voter approval. Pursuant to the Public Housing Election Implementation Law, Health and Safety Code Section 37000 at seq. ("PHEIL"), which implements and governs when a rental housing project must comply with Article XXXIV, the words "developed, constructed, or acquired" do not apply, and therefore no voter approval is required, when a state public body provides assistance to a low -rent housing project and monitor construction or rehabilitation of a project while complying with the following conditions of such assistance to the extent of: a Carrying out routine governmental functions. a Performing conventional activities of a lender. Imposing constitutionally mandated or statutorily authorized conditions accepted by the grantee of assistance. Additionally, Section 37001 of the PHEIL provides that a "low -rent housing project" does not include any development of residential dwellings or living accommodations that consist of the rehabilitation, replacement, improvement or reconstruction of a previously existing low rent project, or residential projects previously or currently occupied by low income households. �0 REPLACEMENT HOUSING PLAN 78181 AVENIDA LA FONDA 78182 AVENIDA LA FONDA 78153 MAIN STREET LA QUINTA REDEVELOPMENT AGENCY Based on the provisions in the PHIEL, including those cited above, the replacement housing to be developed and constructed pursuant to this Plan does not require approval of the voters of the City of La Quinta under Article XXXIV. The rental housing slated for the Washington Street Apartments is partially replacing existing low income rental housing. Furthermore, by providing assistance to these replacement housing projects and monitoring their construction or rehabilitation, as proposed in this Plan, the Agency will be complying with conditions that are imposed by the Law, including Health and Safety Code Section 33413, and thereby carrying out routine governmental functions.