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2012 10 23 HC SpecialHousing Commission agendas and staff reports are available on the City's web page: wwwda-auinta.org HOUSING COMMISSION AGENDA CITY HALL STUDY SESSION ROOM 78-495 Calle Tampico, La Quinta SPECIAL MEETING on TUESDAY, OCTOBER 23, 2012 at 6:00 P.M. CALL TO ORDER 1. Roll Call 2. Pledge of Allegiance PUBLIC COMMENT At this time members of the public may address the Board on any matter not listed on the agenda. Please complete a "Request to Speak" form and limit your comments to three minutes. CONFIRMATION OF AGENDA APPROVAL OF MINUTES 1. Approval of the minutes of June 13, 2012 BUSINESS SESSION Election of Chairperson and Vice Chairperson REPORTS AND INFORMATIONAL ITEMS 1. Update on Housing Commission Vacancies 2. Update on Housing Authority Projects and Recent Actions 3. Review of Housing Authority Work Plan ADJOURNMENT The next meeting of the Housing Commission will be a held on December 12, 2012, commencing at 6:00 p.m. in the City of La Quinta Study Session Room, 78- 495 Calle Tampico, La Quinta, California 92253. DECLARATION OF POSTING I, Lori Lafond, Housing Commission Secretary, of the City of La Quinta, do hereby declare that the foregoing agenda for the La Quinta Housing Commission meeting was posted on the outside entry to the Council Chambers at 78-495 Calle Tampico, and the bulletin boards at 78-630 Highway 111 and the La Quinta Cove Post Office at 51-321 Avenida Bermudas, on October 19, 2012. DATED: October 19, 2012 IRIVLA�FOND, H sing Commission Secretary City of La Quinta, California Public Notices The La Quinta City Study Session Room is handicapped accessible. If special equipment is needed for the hearing impaired, please call the City Clerk's office at (760) 777-7123, twenty-four (24) hours in advance of the meeting and accommodations will be made. If special electronic equipment is needed to make presentations to the Housing Commission, arrangements should be made in advance by contacting the City Clerk's office at (760) 777-7123. A one (1) week notice is required. If background material is to be presented to the Board during a Housing Commission meeting, please be advised that ten (10) copies of all documents, exhibits, etc., must be supplied to the Housing Commission Secretary for distribution. It is requested that this take place prior to the beginning of the meeting. Any writings or documents provided to a majority of the Housing Commission regarding any item(s) on this agenda will be made available for public inspection at the City Clerk's counter at City Hall located at 78-495 Calle Tampico, La Quinta, California, 92253, during normal business hours. HOUSING COMMISSION AGENDA 2 OCTOBER 23, 2012 AGENDA CATEGORY: HOUSING COMMISSION MEETING DATE: October 23, 2012 n , BUSINESS SESSION: ITEM TITLE: Election of Chairperson and Vice CONSENT CALENDAR: Chairperson STUDY SESSION: PUBLIC HEARING: RECOMMENDED ACTION: Elect one member to serve as Chairperson and elect one member to serve as Vice Chairperson for the Housing Commission. EXECUTIVE SUMMARY: A Chairperson for the Commission is selected to preside over the meetings. The Vice Chair will preside over the meeting when the Chair is unavailable. An open vote will be taken at the first Commission meeting to select a Chairperson to serve a one-year term. After the Chairperson has been elected, an open vote to select a Vice Chairperson to serve a one-year term will follow. Voting Procedures: All actions must be taken on a majority vote or by a majority of the quorum present. On the passage of every motion, the vote shall be taken by voice or roll call as appropriate. Staff will open and close nominations to the Commission for the Chairperson. The vote will be taken and the Chairperson will be elected. Tie Votes: In the case of a tie vote, an additional motion is made which obtains a majority vote to break the tie. If a vote results at a time when less than all members are present, the matter shall automatically be continued to the Agenda of the next regular meeting, unless otherwise ordered by the body. Respectfully submitted, Debbie Powell Economic Development/Housing Manager r AGENDA CATEGORY: HOUSING COMMISSION MEETING DATE: October 23, 2012 BUSINESS SESSION: ITEM TITLE: Update on Housing Commission CONSENT CALENDAR: Vacancies STUDY SESSION: PUBLIC HEARING: REPORTS & INFO: Two Housing Commission tenant seats remain vacant. One tenant must be at least age 62. The City Clerk's office has conducted several recruitment efforts, and to date, has received one application from a Cove home tenant (under age 62). Staff has confirmed the applicant's continued interest in serving on the Commission. However, due to a lack of applicants for this and other City boards and commissions, the City Council has not yet appointed applicants. Staff is working to find an age 62 tenant applicant — the goal is to recruit an applicant within the next month, and have the Housing Authority make appointments on December 18, 2012. Respectfully submitted, Debbie Powell Economic Development/Housing Manager T'ar^FraR" AGENDA CATEGORY: HOUSING COMMISSION MEETING DATE: October 23, 2012 BUSINESS SESSION: ITEMTITLE: Update on Housing Authority Projects and CONSENT CALENDAR: Recent Actions STUDY SESSION: PUBLIC HEARING: _ REPORTS & INFO: Housing Authority Projects The La Quinta Housing Authority is currently overseeing two affordable housing projects: Coral Mountain Apartments and Washington Street Apartments Rehabilitation Project. Coral Mountain Apartments Located east of Dune Palms and south of Highway 1 1 1 (next to Costco), it will provide 176 affordable units for very low- and low-income residents. The La Quinta Housing Authority provided $29,000,000 in redevelopment affordable housing funds to the project. The land is being leased for 55 years (with an option for an additional 20 years) to the project developer/owner, Coral Mountain Partners, LP, a local developer. At the end of the lease term, the apartments will revert to the La Quinta Housing Authority. The project scope also includes: • Improved access to Desert Sands Unified School District's bus yard (completed) • Signalized intersection at Dune Palms and "A" Street (completed) • "A" Street will provide direct access to Costco from Dune Palms Road Because this was one our final redevelopment -funded projects, we had to obtain Oversight Board and State Department of Finance approval, which was granted in April 2012. Construction started in late September 2012. Anticipated completion date is February -March 2014. Washington Street Apartments Rehabilitation Project At the June 13, 2012 meeting, staff reported the project had been placed on hold because the State Department of Finance had questioned the project being an "enforceable obligation." In addition, the State has not yet made a decision regarding the use of 2011 bond proceeds (the State may force agencies to refund those bonds to free up future property tax dollars). In an effort to move the project forward, staff gained Oversight Board concurrence that the project is an enforceable obligation, and included the project on an amended enforceable obligation list for July -December 2012. The State never responded to these actions. Additionally, staff included the project on the January -June 2013 enforceable obligation list, which was approved by the State. Therefore, staff is moving forward - the design team has been reconvened and is currently preparing construction drawings. It is anticipated the project will be bid in early 2013. Recent Housing Authority Actions July 3, 2012 Approval of professional services agreements related to Washington Street Apartments Rehabilitation, including: Tall Man Group Project Management and Construction Management Contract Amount-$785,200 (includes $57,000 for sub - consultants) Term - through 7-31-2015 Altum Group Engineering Services, Design through Construction $146,250 Term - through 7-31-2015 RGA Landscape Landscape Architecture $32,605 Term -_through 7-31-2015 August 7, 2012 Approval of a professional service agreement related to Washington Street Apartments Rehabilitation: Studio E Architects Architectural Services $275,000 Term - through 7-31-2015 2 Q September 18, 2012 Approval of a Loan Advance for the Coral Mountain Apartments Project: Additional expenses of $190,302.34 were incurred during construction of off -site improvements at Dune Palms/"A" Street/Desert Sand Unified School District's Bus Yard (utilities, traffic control, dust control, inspection, etc.). These expenses were attributable to the Coral Mountain Apartments project, and the funds were advanced from the $29,000,000 reserved for the Housing Authority loan, which would later be placed into an escrow account once all loan documents and agreements were executed. However, the costs were not included in the budget submitted to the developer's lender. The lender had already secured its credit committee approval of the transaction, and loan documents and agreements were drawn when this oversight was discovered. Any changes required the lender to go back to its credit committee to gain approval. Therefore, in order to close the transaction on schedule, the Housing Authority placed the additional $190,302.34 into the escrow account and then billed the developer. This increased the Housing Authority loan amount to $29,190,302.34. An invoice has been sent to the developer, and staff expects repayment in the near future. October 16, 2012 Approval of a Request for Qualifications for Housing Compliance Services and Authorize Staff to Circulate: The Housing Authority has a contract with Becky Caha to provide affordable housing compliance and monitoring services. These are specialized services related to the Authority's silent second trust deed, sewer subsidy and residential rehabilitation loan programs. (The Authority currently has 419 silent second trust deeds, 107 sewer subsidy loans, and 2 residential rehabilitation loans.) Ms. Caha's contract will expire in December 2012; and staff recommended issuing a Request for Qualifications (" RFQ" ). The RFQ was sent to several real estate and affordable housing consulting firms, as well as to Ms. Caha, on October 19, 2012. Consideration of La Quinta Rental Program Property Management Services: The La Quinta Housing Authority owns 28 single-family homes in the La Quinta Cove that are rented to very low- and low-income tenants with rent subsidy provided by the HUD Section 8 program. Property management is provided by local firms. La Quinta Palms Realty has been managing the properties and administering the Section 8 program since 2002; they were selected via a request for qualifications process. Their agreement has been extended three times; the current agreement expires in February 2013. 3 In awarding contracts, the Housing Authority follows the La Quinta Municipal Code. The Code provides that service contracts may be awarded or extended without competitive proposals if the service provider has demonstrated competence and satisfactory performance. Given the fact that La Quinta Palms Realty has consistently provided excellent service, staff recommended negotiating a two-year contract extension — the Housing Authority approved the recommendation. The Housing Authority will consider the contract at its November 20, 2012 meeting. Respectfully submitted, Debbie Powell Economic Development/Housing Manager C! HOUSING COMMISSION MEETING DATE: October 23, 2012 AGENDA CATEGORY: BUSINESS SESSION: ITEM TITLE: Review of Housing Authority Work Plan CONSENT CALENDAR: STUDY SESSION: PUBLIC HEARING: REPORTS & INFO: On August 7, 2012, the La Quinta Housing Authority ("LQHA") discussed and approved a proposed fiscal year 2012-2013 Work Plan, which is included as Attachment 1. The Work Plan outlines the LQHA's programs/properties and related actions to be accomplished during the fiscal year. During this discussion, the LQHA also approved the Housing Commission's fiscal year 2012-2013 Work Plan (Attachment 2). Staff will provide a verbal summary of the LQHA Work Plan, and will answer any questions of the Housing Commission. Respectfully submitted, Debbie Powell Economic Development/Housing Manager Attachments: 1. La Quinta Housing Authority FY 2012-2013 Work Plan 2. La Quinta Housing Commission FY 2012-2013 Work Plan ATTACHMENT 1 La Quinta Housing Authority Affordable Housing Action Plan Fiscal Year 2012/2013 28 Cove Rental Homes Action 1: Continue the Cove Home Rental Program, which provides single-family rental homes to HUD Section 8-qualified tenants Action 2: Continue to manage properties via contracted property management firm, La Quinta Palms Realty (contract expires February 2013) Action 3: In late fall/early winter 2012, review La Quinta Palms contract; direct staff to renew contract or issue a Request for Proposals/Qualifications Foreclosed Home Purchase & Rehab Program Action 1: Complete rehabilitation on the final home purchased via Fiscal Year 2009/2010 program; sell to income -qualified buyer; provide Silent Second Trust Deed to facilitate affordability/record affordability covenant Housing Authority Vacant Property Action 1: Continue discussions with affordable housing developers regarding opportunities for disposition and future development of Housing Authority -owned, unentitled vacant land. Action 2: Based on developer discussions and staff analysis, make recommendations to the Housing Authority Board regarding options for the various properties. Action 3: Market the properties to interested developers. Property Descriptions: A description of the properties is provided below. See maps attached as Exhibits 1 and 2 - each property is referenced on the map by the letter preceding the description. Various options are listed below the property descriptions, but are in no means the only possible options. A. Three standard Cove residential lots (50' x 100'). Zoning is Residential Cove (RC), allowing construction of single family homes through the building permit process 1. Donate to Habitat for Humanity or similar non-profit for construction of affordable homes 2. Sell or donate to City for "pocket parks" Recommendation to Housing Authority - Spring 2013 B. 11,326 square foot residential parcel on Calle Tamazula, east of Washington Street/south of Avenida La Fonda, adjacent to a vacant City -owned property to the north and a privately -owned and developed parcel to the south; zoned Low Density Residential (RL), allowing construction of a single family home through the building permit process 1. Donate to Habitat for Humanity or similar non-profit for construction of affordable home Recommendation to Housing Authority - Spring 2013 C. 1.16 acres northeast of La Quinta Community Park. Current zoning is Village Commercial (VC). 1 . Develop affordable "artists' lofts" above retail studios 2. Develop affordable mixed use housing Recommendation to Housing Authority - Late fall/Early Winter 2012 D. 5.7 acres on the southeast corner of Westward Ho Drive and Dune Palms Road zoned Medium Density Residential (RM) with density not to exceed up to eight (8) dwelling units per acre. 1. Continue discussions with LQRDA's previously -selected developer, Bridge Housing, about options/funding 2. Continue discussions with Ron Brady & Associates Real Estate (Jim Knickerbocker) regarding development of a mixed market rate/affordable apartment complex 3. Engage other developers regarding development options/funding Recommendation to Housing Authority - Spring 2013 E. 6.9-acre parcel immediately south of the Washington Street Apartments property, zoned High Density Residential (RH), which allows up to sixteen (16) dwelling unit per acre. 1. Continue discussions with affordable housing developers regarding options to create a development that complements Washington Street Apartments Recommendation to Housing Authority - Spring 2013 It should be noted the Housing Authority also has the option to sell any or all of the above -listed properties for fair market value, and deposit sale proceeds into the Housing Authority fund for other/future affordable housing projects and programs. Washington Street Apartments F. Washington Street Apartments 1. Continue with current program, begin construction drawings; move forward to construct 24 new units and rehabilitate 72 units, dependent upon DOF determination regarding use of 2011 bond proceeds 2. Initiate/continue discussions with affordable housing developers regarding a joint venture structure, which could infuse other funding into the project 3. As part of number 2, explore possibilities for ownership structure (sell to developer, lease structure, revenue sharing, etc.) 4. Ensurethat USDA -Rural Development approves of any change in ownership/development structure Recommendation to Housing Authority - Spring 2013 Housing Authority Encumbered Property Coral Mountain Apartments The Disposition and Development Agreement ("DDA") with Coral Mountain Partners, L.P. has been transferred from the former LQRDA to the LQHA. Construction is scheduled to begin in August 2012. Action 1: Monitor the project to ensure compliance with all DDA provisions and adherence to the schedule of performance. Action 2: Work closely with developer to facilitate necessary City/LQHA review and approvals. Action 3: Monitor project budget; review payment requests and work closely with escrow company to ensure accurate and timely reimbursements to developer. Silent Second Trust Deed Program The Housing Authority currently holds approximately 420 Silent Second Trust Deeds on homes throughout the City. The program was very active in the 1990's- early 2000's, but has been scaled back and is currently used for the foreclosed home program. The Silent Second funds the gap between a market rate and affordable mortgage, and places a 45-year affordability covenant on the home. If a home is sold to a non -income qualified buyer, or if it is sold at a foreclosure sale, the affordability covenant is lost. Once a house has gone into foreclosure, the foreclosure sale happens fairly quickly. The Housing Authority may submit a bid, but the bid must cover the cost of the existing loan plus the silent second trust deed to preserve the affordability covenant. If the Housing Authority's bid is successful, the house could then be rehabilitated, if needed, and sold to another income -qualified buyer. Action 1: Authorize staff to analyze the cost (including any potential rehabilitation costs, fees, back taxes, etc.) to purchase Housing Authority Silent Second Trust Deed - encumbered homes that go to foreclosure sale on a case -by -case basis. Watercolors The Watercolors development is a gated community on Avenue 48 near Dune Palms Road containing 149 single-family homes affordable to low and moderate income seniors age 55+. In 2003, the La Quinta Redevelopment Agency entered into an affordable housing agreement with Santa Rosa Development to provide Agency -funded silent second trust deeds for these homes, thus securing 45-year affordability covenants. The Agency invested $13.0 million in this project. Staff held a meeting with Watercolors residents in December 2011 to discuss several ongoing issues. Many have been resolved; however, there are several resident questions and issues that require further research and discussion, including the CC & R prohibition on renting the houses; the challenges for heirs due to the 55+ age restriction; and a request by some residents to write down (or completely extinguish) the Silent Second Trust Deeds. Action 1: Conduct a study session in fall/winter 2012 to further discuss and provide staff with direction on these issues. ATTACHMENT 2 Housing Commission Work Plan Fiscal Year 2012/2013 With the State wide dissolution of redevelopment agencies, local housing authorities had the option of becoming "Housing Successors" to the former redevelopment agencies. The La Quinta Housing Authority adopted Resolution No. 2012-002, electing to become the Housing Successor to the former La Quinta Redevelopment Agency. The Housing Authority will continue with the former La Quinta Redevelopment Agency's efforts to provide quality affordable housing. The Housing Commission's function is to review and make recommendations on matters that come before the Housing Authority, except emergency matters and matters the Housing Commission itself elects not to consider. • Review quarterly reports from Housing Authority -owned properties, including the Cove Rental Homes and Washington Street Apartments • Review quarterly reports from the various non -Housing Authority - owned properties, including Wolff Waters Place, Vista Dunes, Seasons Senior Housing, Hadley Villas • Invite local affordable housing property managers/management firms to make presentations to the Commission regarding the properties and programs for residents • Facilitate programs/education/outreach for renters about becoming homeowners • Conduct an educational seminar for local brokers regarding La Quinta's affordable housing programs and projects • Review documents related to Housing Authority -owned properties such leases, rules & regulations, and admission applications • Continue to receive updates on projects in process, including Washington Street Apartments and Coral Mountain Apartments • Continue to receive updates on State legislation affecting affordable housing The La Quinta Housing Authority will be formulating plans and policies with regards to Housing Authority -owned properties and assets: • Review Housing Authority's action plan regarding Housing Authority - owned vacant land • Review Housing Authority's policy related to foreclosures on silent second trust deed homes • Review Housing Authority's policy changes related to the Watercolors Senior Housing Development 2 s s' S �CEM OF Tt�'�w HOUSING COMMISSION MEETING ATTENDANCE COMPENSATION DATE: October 23, 2012 TO: DIANE/FINANCE DEPARTMENT FROM: LORI LAFONDMOUSING COMMISSION SECRETARY SUBJECT: COMPENSATION FOR SPECIAL HOUSING COMMISSION MEETING ATTENDED ON OCTOBER 23, 2012 --------------------------------------- COMPENSATION OF $50.00 PER MEETING. ACCOUNT NOS. 241-9101-705.10-10 (50%) & 242-9201-70610-10 (50%) COMMISSIONER TOTAL AMOUNT OF COMPENSATION Michele McDonough 54400 Ave. Vallejo La Ouinta, CA 92253 $50.00 Q:Housing Commission/Compensation Request Form