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1996 07 22 RDA Minutes& LA QUINTA REDEVELOPMENT AGENCY MINUTES JULY 22, 1996 Adjourned meeting of the La Quinta Redevelopment Agency was called to order by Chairman Sniff. PRESENT: Board Members Adolph, Henderson, Holt, Perkins, Chairman Sniff ABSENT: None PUBLIC COMMENT None CONFIRMATION OF AGENDA Board Member Henderson asked that Consent Item No.4 be moved to Business Session No.5. APPROVAL OF MINUTES MOTION It was moved by Board Members Holt/Adolph that the Minutes of July 2, 1996 and July 16, 1996 be approved as submitted. Motion carried unanimously. BUSINESS SESSION 1 CONSIDERATION OF ADOPTION OF RESOLUTION APPROVING THE FISCAL YEAR 1996/97 BUDGET. Board Member Henderson advised that the comments she made under City Council Business Session No.1 apply to this item also. Board Member Perkins advised that he has a serious question regarding the use of Redevelopment Agency funds for certain projects previously approved by the City Council because the way he understands it, the use of RDA funds are to be used to rehabilitate the area in which a project is to be located. He saw no connection between the Chamber of Commerce, which has now moved their main office out of the area and saw no reason that the funds given to them or the Arts Foundation has any impact on rehabilitation of their areas. BIB] 09-06-1996-U01 08:50:40AM-U01 RDAMIN-U02 07-U02 22-U02 1996-U02 &Redevelopment Agency Minutes Page 2 July 22, 1996 RESOLUTION NO. RA96-05 A RESOLUTION OF THE LA QUINTA REDEVELOPMENT AGENCY APPROVING A BUDGET FOR FISCAL YEAR 1996/97 It was moved by Board Members Holt/Adolph to adopt Resolution No. RA96- OS as submitted. Motion carried with Board Members Henderson/Perkins voting NO. 2. CONSIDERATION OF REQUEST OF THE BOYS AND GIRLS CLUB BUILDING HORIZONS, TO AMEND THE DISPOSITION AND DEVELOPMENT AGREEMENT. Mr. Spevacek, Consultant with Rosenow, Spevacek Group, presented staff report advising that on June 4, 1996, the Agency Board approved a 1996-97 Affordable Housing Agreement to facilitate the construction and sale of two single-family homes affordable to low or moderate-income households. It provides that the agency will loan up to $210,000 to Building Horizons to fund property acquisition and dwelling construction activities. When the two residential units are subsequently sold, up to 60,000 of this amount will be converted into second trust deed mortgages to ensure that the resulting housing costs are affordable to low and/or moderate-income households. The remaining $150,000 would be repaid to the Agency. The agreement also provides that covenants be recorded against each unit to ensure that they remain affordable to the designated households for a minimum of 30 years. Building Horizons has requested the following modifications to the agreement: 1. Provide for the construction of four-bedroom versus three-bedroom homes. 2. Provide for a sales price increase to $1 15,000 per unit. 3. Allow the subsidy to be placed on a floating basis, with a limit, to facilitate a higher sales price as well as protection against rising interest rates. 4. Change the income categories for the subsidies from low and moderate income households to very low and low income, or two-low income households. BIB] 09-06-1996-U01 08:50:40AM-U01 RDAMIN-U02 07-U02 22-U02 1996-U02 &Redevelopment Agency Minutes Page 3 July 22,1996 Mr. Spevacek advised that the most significant. aspects of the proposal are the increase in sales price by $10,000 per unit and the substitution of a moderate-income household to a very low or low-income household. These changes increase the amount of funds necessary to finance the difference between the sales price less a 3% down payment, and an affordable first trust deed mortgage. The existing agreement provides a total of $60,000 to fund this differential; the requested modifications could increase this amount up to $100,000 for two low income houses and $120,000 for one very low and one low-income house. In response to Board Member Perkins regarding the decrease in assessed valuations, Mr. Spevacek advised that that was not taken into consideration, adding that until the homes are designed and offered on the market we won't know what the market will bear. He advised that we may also be looking at the same request for the second-year program, in part, because of the softening of the real estate market in the Cove. In further response to Board Member Perkins, Mr. Spevacek, advised that the Agency is keeping with pace with other jurisdictions in the area of providing low/moderate-income housing and some in places, we are even ahead. Board Member Henderson asked who handles the real estate sales and Mr. Spevacek advised La Quinta Properties and noted that the City is not involved in that process, that they are the sales agent for Building.Horizons. In response to further questions by Board Member Henderson, Mr. Spevacek advised that La Quinta Properties, Williams Development and La Quinta Palms regarding the current pool of eligible low-income home buyers wishing to purchase homes in the Cove. MOTION It was moved by Board Members Holt/AdoIph to approve the modifications that would provide for four-bedroom units, a sales price increase to $1 15,000 and the substitution of a low-income household for the moderate-income household, and authorize Agency legal counsel to so modify the 1996/97 Affordable Housing Agreement. Motion carried unanimously. BIB] 09-06-1996-U01 08:50:40AM-U01 RDAMIN-U02 07-U02 22-U02 1996-U02 &Redevelopment Agency Minutes Page 4 July 22, 1996 3. CONSIDERATION OF RECOMMENDATION BY THE SELECTION COMMITTEE TO ENTER INTO NEGOTIATIONS FOR A CONTRACT WITH CATELLUS RESIDENTIAL GROUP FOR THE DEVELOPMENT OF AN AGENCY HOUSING PROJECT AT THE CORNER OF 48TH AVENUE AND JEFFERSON STREET. Mr. Spevacek, Consultant with Rosenow, Spevacek Group, advised that on April 16, 1996 the Agency Board authorized the circulation of a Request for Qualifications to residential developers. The selection committee reviewed the seven responses and elected to interview tour of them. Following the interviews, the committee felt that the Catellus Residential Group was the best candidate for subsequent negotiations leading to an affordable housing agreement. Further, the selection committee recommends that should negotiations with the Catellus Group not be successful, that the second choice would be Century Crowell Communities. Therefore, the selection committee is recommending that the Catellus Group be selected and authorize staff to enter into contract negotiations with the resultant contract being brought back before the Board for consideration. MOTION It was moved by Board Members Adolph/Holt to authorize staff to enter into negotiations with the Catellus Residential Group and authorize the Agency Chair to sign the contract and instruct staff to appropriate the necessary funds. Motion carried unanimously. 4. CONSIDERATION OF RECOMMENDATION BY THE SELECTION COMMITTEE TO ENTER INTO NEGOTIATIONS FOR A CONTRACT WITH LA QUINTA REAL ESTATE, MR. RUPERT YESSAYIAN, FOR PROPERTY MANAGEMENT AND REAL ESTATE SERVICES FOR 50 SINGLE-FAMILY RENTAL UNITS OWNED BY THE REDEVELOPMENT AGENCY. Mr. Herman, Community Development Director, advised that on April 16, 1 996, the Agency authorized the circulation of a Request for Proposals to local real estate companies for property management and real estate services related to the maintenance, management, and selective sale of the 50 single-family dwellings that constitute the La Quinta Housing Program. The RFP was distributed to 10 companies and three proposals were received from the following: California Management Consultants of North Shore, Calif. La Quinta Properties of La Quinta, Calif. La Quinta Real Estate of La Quinta, Calif. BIB] 09-06-1996-U01 08:50:40AM-U01 RDAMIN-U02 07-U02 22-U02 1996-U02 &Redevelopment Agency Minutes Page 5 July 22, 1 996 The selection committee interviewed all three and recommends La Quinta Real Estate to the Board with La Quinta Properties slated as a back-up firm if negotiations with La Quinta Real Estate are not successful. Once approved, staff will enter into negotiations for a five-year contract which will be brought back before the Board for consideration. Board Member Adolph asked if the real estate end would be an exclusive listing or would it be by multiple listing and Mr. Herman advised that it would be an exclusive listing with the firm receiving a 3% commission. In response to Board Member Henderson, Mr. Herman advised that the number of homes which will be placed on the market at any given time will be an Agency decision, as the Board has indicated that they do not want to flood the market with these homes. Board Member Henderson asked if there was any consideration to splitting the contract between the real estate sales and the property management and Mr. Herman advised not, but f that is the Board's decision, staff could do further research as to the impact that would have on the management part of the contract. In response to further questions by Council, Mr. Herman advised that the units are all currently Section 8 rentals. He also noted that one of the homes have been sold, so the number is now 49. Following further discussion, there was no concurrence to splitting the contract. MOTION It was moved by Board Members Holt/Adolph to authorize staff to enter into negotiations for the management and possible sale of the 49 single family units owned by the Redevelopment Agency with La Quinta Real Estate of La Quinta. Motion carried unanimously. 5. CONSIDERATION OF CONTRACT SERVICES AGREEMENT WITH THE LA QUINTA ARTS FOUNDATION FOR FISCAL YEAR 1996197. Board Member Henderson stated that she found it difficult to approve this contract with funding coming from the Redevelopment Agency. BIB] 09-06-1996-U01 08:50:40AM-U01 RDAMIN-U02 07-U02 22-U02 1996-U02 &Redevelopment Agency Minutes Page 6 July 22, 1996 MOTION It was moved by Board Members Holt/Adoiph to approve the Contract Services Agreement with La Quinta Arts Foundation for Fiscal Year 1996/97. Motion carried with Board Members Henderson/Perkins voting NO. CONSENT CALENDAR 1. APPROVAL OF DEMAND REGISTER DATED JULY 22. 1996. 2. TRANSMITTAL OF TREASURY REPORT DATED MAY 31, 1996. 3. ACCEPTANCE OF ASSESSMENT/SEWER HOOKUP FEE SUBSIDY PROGRAM PROJECT 96-07 AND AUTHORIZATION FOR CITY CLERK TO FILE NOTICE OF COMPLETION. 4. MOVED TO BUSINESS SESSION NO.5. MOTION It was moved by Board Members Adolph/Holt to approve the Consent Calendar as recommended and as amended. Motion carried unanimously. DEPARTMENT REPORTS 1. TRANSMITTAL OF REVENUE AND EXPENDITURES REPORT DATED MAY 31,1996. MOTION It was moved by Board Members Holt/Adolph to receive and file the Revenue and Expenditures Report dated May 31, 1996. CHAIR AND BOARD MEMBERS' ITEMS None PUBLIC HEARINGS None BIB] 09-06-1996-U01 08:50:40AM-U01 RDAMIN-U02 07-U02 22-U02 1996-U02 & Redevelopment Agency Minutes 7 July 22, 1996 CLOSED SESSION 1. CONFERENCE WITH AGENCY'S REAL PROPERTY NEGOTIATOR PURSUANT TO GOVERNMENT CODE SECTION 54956.8 CONCERNING AN AMENDMENT TO THE DISPOSITION AND DEVELOPMENT AGREEMENT WITH WILLIAMS DEVELOPMENT CORPORATION THAT WOULD AFFECT THE TERMS OF PAYMENT FOR THE PROPERTY LOCATED ON CALLE TAMPICO WEST OF WASHINGTON STREET PROPERTY OWNER/NEGOTIATOR: BETTY WILLIAMS The Board reconvened with no decision being made which requires reporting pursuant to Section 54957.1 of the Government Code Brown Act). There being no further business the Agency Board was adjourned. Re ectfully submitted C La Quinta Redevelopment Agency BIB] 09-06-1996-U01 08:50:40AM-U01 RDAMIN-U02 07-U02 22-U02 1996-U02