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CC Resolution 1996-012^J2 RESOLUTION 96-*2 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LA QUINTA APPROVING A FIRST AMENDMENT TO THE FIRST RESTATED AND AMENDED DISPOSITION AND DEVELOPMENT AGREEMENT BY AND BETWEEN LA QUINTA REDEVELOPMENT AGENCY AND E.G. WILLIAMS DEVELOPMENT CORPORATION WHEREAS, the Agency and the Developer entered into a Disposition and Development Agreement, dated September20, 1994 the DDA"), a copy of which is on file as a public record with the City Clerk of the City of La Quinta and which is incorporated herein by reference; and WHEREAS, the Agency and the Developer entered into a First Restated and Amended Disposition and Development Agreement dated the 3Oth day of September, 1994 First Restated and Amended DDA"), a copy of which is on file as a public record with the City Clerk of the City of La Quinta and which is incorporated herein by reference; and WHEREAS, the Agency and the Developer entered into a First Implementation Agreement dated 1 *h day of June, * 995 and a Second Implementation Agreement dated 5th day of July, 1995 collectively referred to as the Implementation Agreements"), copies of which are on file as public record with the City Clerk of the City of La Quinta and are incorporated herein by reference; and WHEREAS, the Developer and the Agency are proceeding to perform their respective obligations pursuant to the First Restated and Amended DDA; and WHEREAS, the Developer and the Agency desire to enter into a First Amendment to the First Restated and Amended DDA to modif* the First Restated and Amended DDA to provide for a portion of the units to be sold at market rate without affordability restrictions thereby allowing a greater number of low income units to be produced; and WHEREAS, the approval and execution of the First Amendment will facilitate the orderly completion of improvements by the Developer as contemplated in the First Restated and Amended DDA and in flirtherance of the Redevelopment Plan for Project Area No.1 the Redevelopment Plan"); and WHEREAS, the Agency is authorized to use tax increment revenues to increase, improve, and preserve the community's supply of low- and moderate-income housing available at affordable housing cost pursuant to Health and Safety Code Section 33334.2; and 3FEB19.6 BIB] 08-21-1998-U01 09:15:13AM-U01 ADMIN-U01 CCRES-U02 96-U02 12-U02 ^J2 I L I I Resolution 96-12 WHEREAS, the Agency and the City Council of the City of La Quinta have conducted a duly noticed joint public hearing regarding the proposed acquisition and disposition of real property in accordance with California Health and Safety Code Sections 33431 and 33433; and WHEREAS, the staff report pertaining to the First Amendment, which has been on display prior to the joint public hearing in accordance with Section 33433 of the California Health and Safety Code Section 33433, contains a detailed description of the provisions of the Amendment; NOW, THEREFORE, the City Council of the City of La Quinta does resolve as follows: Section 1. The environmental review of a Negative Declaration for the original project approval remains adequate. Section 2. The City Council flirther finds and determines that: a) the approval of the First Amendment will promote the objectives of the Redevelopment Plan and promote the health, safety and welfare of the citizens of the City of La Quinta; b) the Amendment is consistent with the orderly development of the improvements to be provided by the Developer pursuant to the First Restated and Amended DDA; and c) the Amendment provides for the enhanced ability for low to moderate income individuals to purchase a newly developed unit to increase the community's supply oflow to moderate units pursuant to Health and Safety Code Section 33334.2. Section 3. The City Council approves the First Amendment in the form of Exhibit A" attached hereto. PASSED, APPROVED, and ADOPTED at a regular meeting of the La Quinta City Council, held on this 5th day of March, 1996, by the following vote, to wit: AYES: Council Members Adolph, Henderson, Sniff, Mayor Pro Tem Perkins NOES: None ABSENT: Mayor Bangerter ABSTAIN: None RON PERKINS, Mayor Pro Tem City of La Quinta, California AT T: AUNDRA L. JUH LA, City Clerk City of La Quinta, California APPROVED AS TO FORM: DAWN HONEYWELL, YCi Attorney 3FEBI9.6 2 BIB] 08-21-1998-U01 09:15:13AM-U01 ADMIN-U01 CCRES-U02 96-U02 12-U02 ^J2 I I I I I REPORT ON THE FIRST AMENDMENT TO THE FIRST RESTATED AND AMENDED DISPOSITION AND DEVELOPMENT AGREEMENT BETWEEN THE LA QUINTA REDEVELOPMENT AGENCY AND E.G. WILLIAMS DEVELOPMENT CORPORATION TO IMPLEMENT AN AFFORDABLE HOUSING PROJECT March 5, 1996 INTRODUCTION This document is a report on the First Amendment to the First Restated and Amended Disposition and Development Agreement Amended DDA") between the La Quinta Redevelopment Agency Agency") and E. G. Williams Development Corporation Developer"). The purpose of the Amended DDA is to modi* the First Restated and Amended Disposition and Development Agreement between the Agency and Developer that was executed on September 30, 1994 DDA"), and would provide for up to fifleen 15) of the units to be sold at market prices without affordable restrictions. Further, fluids repaid to the Agency from the sale of the Market Rate Units would be pledged to fund additional second trust deed mortgages for low income home buyers. The DDA established a contractual obligation between the Agency and Developer to facilitate the construction of a 1 5-unit residential development, a five acre flood control detention basin, and related infrastructure improvements Project"). The residential development includes 91 senior citizen multi-family rental dwellings, that feature rents affordable to very low income households, and 60 single family dwellings that are being sold to very low, low, and moderate income home buyers. This Report generally describes the Project and the modifications to the DDA as presented in the Amended DDA. Included as an attachment is the full text of the Amended DDA Attachment A). THE AFFORDABLE PROJECT On June 13, 1994, the Agency acquired an approximately 35.23 acre site Site") located north of Calle Tampico, east of the extension of Desert Club Drive, in the Village of La Quinta. Approximately 10.0 acres of the Site was conveyed to Desert Sands Unified School District, upon which an elementary school is under construction. The remaining 25.23 acres was conveyed to the Developer for the construction of 60 single-family homes, 91 multi-family aparttnents, and a five acre flood control detention basin. The single-family dwellings are being sold to very low, low, and moderate income owner-occupied households, and the multi-family units are being rented exclusively to very low and low income senior citizen households. In order to achieve affordable 2WILL.2DDA BIB] 08-21-1998-U01 09:15:13AM-U01 ADMIN-U01 CCRES-U02 96-U02 12-U02 ^J2 I * L I I I I housing costs for the targeted households, the DDA further provided for Site conveyance to the Developer for a price of $1.00; the total value of the property, established at the purchase price and related costs the Agency incurred to acquire the Site was $877,016. Further, the DDA provided an additional $3,654,414 in financial assistance to construct both on- and off-site infrastructure improvements, and the flood control detention basin; all of these improvements are required to facilitate Project development. Both the Site purchase and infrastructure assistance costs were funded through the Agency's Low and Moderate Income Housing Fund. To date, the Developer has constructed 33 of the 60 single family dwellings; of these, seven 7) units have been sold and are occupied. The Developer has also constructed all 91 multi-family units, which are currently being rented. THE AMENDED DDA ITS PURPOSE On January 2, 1996, Agency staff received a verbal request from the Developer to remove up to fifteen moderate income housing units from the Agency's affordable housing program, and sell these units on a nonrestricted basis. The Developer stated that current market conditions are inhibiting the sales of moderate income units to qualified households. The unit prices are in a range that is competitive with other single-family developments within the vicinity that offer aggressive home buyer incentives, but do not require the imposition of 30-year affordability covenants. As such, the sales pace for the minimally assisted $1,000 per unit) moderate income units is slow, and the project construction lender, First Interstate Bank, desires increased sales activity. Noneligible moderate income home buyers have expressed interest in purchasing these units these home buyers are noneligible because their incomes exceed $54,800 a year), and the Developer would like to capture these sales and move the unsold units, thus alleviating the lender's concerns. The modifications embodied in the Amended DDA are surnmarized as follows: * Release of up to 15 units from affordability covenants The Amended DDA provides that up to 15 of the 40 units designated for moderate income home buyers may be sold to households whose incomes exceed the moderate income criteria as established by State law) or $54,800 a year. These units Market Rate Units") will be sold at a higher price than the covenant restricted units, and 30 year affordability covenants will not be imposed. * Increased sales price for market rate units The Market Rate Units will feature a higher sales price than the remaining covenant restricted units. This will provide funds to reimburse the Agency for the Agency's contribution to the land cost related to these units. The Amended DDA provides that the new sales price for these Market Rate Units will be as follows: ModelA $112,990 ModelB $117,990 ModeIC $121,990 2WILL.2DDA BIB] 08-21-1998-U01 09:15:13AM-U01 ADMIN-U01 CCRES-U02 96-U02 12-U02 ^J2 Agency reimbursement of land cost for Market Rate Units and funding of additional low income units. The Developer will pay the Agency $6,500 per unit of the increased sales price for ffie Market Rate Units. The Amended DDA provides that the Agency may dedicate these monies to flind additional second trust deed mortgages for low income home buyers. Thus, up to three of the remaining 25 moderate income units may be sold to low income households. p 2WILL.2DDA BIB] 08-21-1998-U01 09:15:13AM-U01 ADMIN-U01 CCRES-U02 96-U02 12-U02 ^J2 FIRST AMENDMENT TO FIRST RESTATED AND AMENDED DISPOSITION AND DEVELOPMENT AGREEMENT BY AND BETWEEN LA QUINTA REDEVELOPMENT AGENCY AND E.G. WILLIAMS DEVELOPMENT CORPORATION THIS FIRST AMENDMENT First Amendment") is entered into this day of 1995, by and between the LA QUINTA REDEVELOPMENT AGENCY Agency") and F.G. WILLIAMS DEVELOPMENT CORPORATION Developer"). RECITALS WHEREAS, the Agency and the Developer entered into a Disposition and Development Agreement, dated September 20, 1994 the DDA"), a copy of which is on file as a public record with the City Clerk of the City of La Quinta and which is incorporated herein by reference; and WHEREAS, the Agency and the Developer entered into a First Restated and Amended Disposition and Development Agreement dated september 30,1994 Restated and Amended DDA"), a copy of which is on file as a public record with the City Clerk of the City of La Quinta and which is incorporated herein by reference; and WHEREAS, the Agency and the Developer entered into a First Implementation Agreement dated June 19, 1995 and a Second Implementation Agreement dated July 5, 1995 collectively referred to as the Implementation Agreements"), copies of which are on file as public record with the City Clerk of the City of La Quinta and are incorporated herein by reference; and WHEREAS, the Developer and the Agency desire to enter into a First Amendment to the First Restated and Amended DDA to modif* the First Restated and Amended DDA to provide for a portion of the units to be sold at market rate without affordability restrictions thereby allowing a greater number of low income units to be produced; and AGREEMENT NOW, THEREFORE, the Agency and the Developer do hereby agree to amend the Restated and Amended DDA as follows: Section 1. Amend Section 101, Purpose of Agreement," subsection 5, to add the following sentence at the end of the paragraph: Notwithstanding the foregoing, an amount of up to fifteen 15) of the units shall be sold at market rate without affordability restrictions thereby allowing a greater number of low income units to be produced by providing Six Thousand Five Hundred Dollars $6,500) BIB] 08-21-1998-U01 09:15:13AM-U01 ADMIN-U01 CCRES-U02 96-U02 12-U02 ^J2 I * I I per market rate unit to be utilized by Agency to flind additional second trust deed subsidies for low income units the Market Rate Payment"). The Market Rate Payment shall be paid directly from escrow for the close of each unit to the Agency" Section 2. Amend Section 102, to replace the definition of Maximum Purchase Price" with the following: Maximum Purchase Price" means: I) as to Model 1, One Hundred Twelve Thousand Nine Hundred Ninety Dollars $112,990); ii) as to Model 2, One Hundred Seventeen Thousand Nine Hundred Ninety Dollars $117,990); and iii) as to Model 3, One Hundred Twenty-One Thousand Nine Hundred Ninety Dollars $121 990). Each of the foregoing Model 1, Model 2, and Model 3 shall be of a quality and size as specified by the terms of the Specific Plan." Section 3. Amend Section 324, Sale of Ownership Units," to replace the first paragraph with the following: With the exception of up to fifteen 15) market rate Ownership Units, the Developer shall offer for sale all of the remainder of the Ownership Units to Qualifying P, at Affordable Housing Cost and subject to recorded covenants enforceable by the Ag* such Ownership Units shall remain available at Affordable Housing Cost for not less than the Applicable Required Period. Such recorded covenants shall be substantially in the form of the Resale Restriction Agreement and Option to Purchase Attachment No.10)." Section 4. Amend Section 402, Commitment of Units for Affordable Housing," as follows: With the exception of up to fifteen 15) market rate units, the Developer covenants and agrees to make the Ownership Units available for sale to Qualifying Buyers and the Rental Units available for rental to Qualifying Renters in conformity with this Agreement. The respective ownership and rental units are to remain affordable for the respective periods of time set forth in Sections 324 and 326 of this Agreement." SectionS. Amend Section 404, Approval of Initial Purchasers," as follows: Ten 10) Ownership Units shall be sold to households having incomes not in excess of fifty percent 50%) of the area wide median income, the Lower Income Ownership Units"); ten 10) to fourteen 14) of the Ownership Units shall be sold to households having incomes not in excess of eighty percent 80%) of the area wide median income the Low Income Ownership Units"); twenty-seven 27) to thirty-five 35) Ownership Units shall be sold to households having incomes not in excess of one hundred twenty percent 120%) of area wide median income the Moderate Income Ownership Units"), all as defined by the Agency pursuant to Section 50052.5 of the California Health and Safety Code) and up to fifteen 15) of the Ownership Units shall be sold at market rate on a nonrestricted basis the Market Rate Units"). With the exception of the Market Rate Units, no transfer of an Ownership Unit from the Developer or Owner to a purchaser shall occur until the Agency 2 BIB] 08-21-1998-U01 09:15:13AM-U01 ADMIN-U01 CCRES-U02 96-U02 12-U02 ^J2 I * LI determines that a) the proposed purchaser intends to occupy the Ownership Unit as the proposed purchaser's principal residence, 1,) the proposed purchaser is a Qualifying Buyer, and c) the proposed transfer occurs at an Affordable Housing Cost as calculated using a fixed rate mortgage. Prior to the conveyance of each Ownership Unit, the Developer shall obtain and deliver to the Agency from each such proposed purchaser such information and completed forms as the Agency shall request to certify the transfer price, proposed purchaser's intent with respect to its residence in the Ownership Unit, and its gross income. The Developer shall cooperate with the Agency in assisting such purchasers to prepare such forms and provide any required information to the Agency in connection with the Developer's original sale of the Ownership Unit. The Agency shall approve or disapprove such proposed purchasers within seven 7) days of its receipt of all requested information, forms and disclosure statements from such proposed purchasers. The Agency's approval or disapproval shall be based only on the criteria set forth above in subsections a), b) and c). If the Agency shall fail to approve or disapprove any such proposed purchaser within such seven 7) day period, unless such time has been extended in writing by the Agency, the proposed purchaser shall be deemed disapproved. The Developer shall use diligent efforts to cause the Lower Income Ownership Units and the Low Income Ownership Units to be sold and occupied in accordance with this Agreement at the earliest feasible time. Of every ten 10) Ownership Units sold by the Developer pursuant to this Agreement, not less than one 1) shall be a Lower Income Ownership Unit, and not less than one I) shall be a Low Income Unit. The Developer shall deliver to and have initialed by Owner(s) a disclosure in form to be provided by the Agency which discloses that the Buyer/Agency Note provides for shared appreciation. Ultimately, the complete configuration shall be ten 10) Lower Income Units, ten 10) to fourteen 14) Low Income Units, twenty-seven 27) to thirty-five 35) Moderate Income Units, and up to fifteen 15) Market Rate Units." Section 6. Amend the first paragraph of Section 405, Buyer/Agency Loans," to read as follows: The purchaser(s) of each restricted Ownership Unit shall execute and deliver or cause to be delivered to the Agency a Buyer/Agency Note in the form of Attachment No.9, as such Note is completed by the Executive Director of the Agency or his designee based upon Section 404 and the remaining provisions of this Agreement." SecUon7. Amend the first paragraph of Section 406, Covenants to Remain Affordable," to read as follows: Prior to the conveyance of any of the restricted Ownership Units to the Qualifying Buyers, the Developer shall execute and record the Declaration of Conditions, Covenants and Restrictions in the Official Records of Riverside County, California, which shall provide all of the following:" SectionS. The following attachment to the Restated and Amended DDA shall be amended as follows: 3 BIB] 08-21-1998-U01 09:15:13AM-U01 ADMIN-U01 CCRES-U02 96-U02 12-U02 ^J2 * I I * I I I) Section 11(A) of the Scope of Development Attachment No. 7), Corresponding * Ownership Improvements," shall be amended to read as follows: Correspondin* Ownership Improvements. This involves 60 single-family dwellings on approximately 5,000 square foot lots; the dwellings will be configured and priced as follows: Market Rate Price RestrictedPrice * 15 units 1,260 square feet/three bedroom, 2 bath, pnce $112,990 $107,990 * 25 uni*:\: 1,371 square feet/three bedroom, 2 bath; price $117,990 $112,990 * 20 units 1,533 square feet/four bedroom, 3 bath; price $121,990 $116,990 The dwellings will be constructed and sold in three 3) phases; the fffst two phases will involve twenty 20) units each, with the third phase involving twenty 20) units. * and off-site improvements necessary for the development of the single-family hom** will also be *u*tructed. These improvements and corresponding agency assistance are listed * A to this Attachment No.7, and flirther described in the Specific Plan and the CUP. These improvements include the construction of a five 5) acre storm water detention basin, with a pum* station and related flood control improvements." Section 9. This First Amendment to the First Restated and Amended DDA and the provisions of the Implementation Agreements and the Restated and Amended DDA, which remain in effect, collectively constitute the Amended DDA." The Amended DDA integrates all of the terms and conditions of agreement between the parties, and supersedes all negotiations or previous agreements between the parties wiih respect to the subject matter hereof. Section 10. Each of the parties hereto warrants and represents to the other that it has the full power and authority to enter into and execute this First Amendment, that all authorizations and approvals required to make this First Amendment binding upon such party have been obtained, and that the person or persons executing this First Amendment on behalf of such parties has been fully authorized to do so. The effective date of this First Amendment shall be the date of execution by the Agency. 1996 REDEVELOPMENT AGENCY OF THE CITY OF LA QUINTA By: STANLEY SNIFF, Chairman 4 BIB] 08-21-1998-U01 09:15:13AM-U01 ADMIN-U01 CCRES-U02 96-U02 12-U02 ^J2ATTEST: SAUNDRA L. JUHOLA, Secretary La Quinta Redevelopment Agency APPROVED AS TO FORM: DAWN C. HONEYWELL, Agency Counsel La Quinta Redevelopment Agency E.G. WILLIAMS DEVELOPMENT CORPORATION By: Its: 5 BIB] 08-21-1998-U01 09:15:13AM-U01 ADMIN-U01 CCRES-U02 96-U02 12-U02