Loading...
HomeMy WebLinkAboutMinutes - City Council - 2009-08-17 - Special Meeting 193 City Council, Special Meeting Council Chambers 777 Cypress Avenue Redding, California August 17,20095:15 p.m. The meeting was called to order by Mayor Bosetti with the following Council Members present: Dickerson, Jones, McArthur, and Stegall. I Also present were City Manager Starman, Assistant City Manager Tippin, City Attorney Duvernay, Assistant to City Manager Clark, and Deputy City Clerk Mize. At the hour of 5 :31 p.m., Mayor Bosetti convened the Special Meeting of the Redding City Council for a joint meeting with the Redding Redevelopment Agency JOINT PUBLIC HEARING- DISPOSITION OF AGENCY-OWNED PROPERTY AT 931 PARKVIEW AVENUE TO K2 LAND & INVESTMENT LLC AND ASSOCIATED DISPOSITION AND DEVELOPMENT AGREEMENT [R-030-050-050] The hour of 5:15 p.m. having arrived, Mayor Bosetti and Chair Jones opened the public hearing regarding the disposition of Agency-owned property at 931 Parkview Avenue. The following documents are on file in the Office of the City Clerk and the Redding Redevelopment Agency: Affidavit of Publication - Notice of Public Hearing Deputy City Clerk Mize advised that no comments had been received to date. I Redevelopment Manager Thompson provided an overview of the Report to City Council and Redding Redevelopment Agency (Agency) dated August 7, 2009, incorporated herein by reference, relative to the disposition of the Agency's property located at 931 Parkview Avenue to K2 Land & Investment LLC (K2)' and the associated Disposition and Development Agreement (DDA). Ms. Thompson recalled that at its meeting on July 20, 2009, the Agency's Board of Directors (Board), in closed session, authorized staff to negotiate DDAs with K2 for the sale and redevelopment of two parcels of Agency-owned land located at 931 Parkview Avenue and 2550 Lanning Avenue. Subsequently, a DDA was negotiated relative to the property located at 931 Parkview Avenue, which was acquired in November 1999 as a potential Parkview Neighborhood redevelopment opportunity site using funds from the Agency's Low- and Moderate Income Housing Fund (LMIHF). She indicated that pursuant to California Redevelopment Law, the Agency has a maximum of 10 years to initiate physical development ofland acquired with LMIHF or it must sell the property and return the funds to the LMIHF. I A Summary Report, prepared pursuant to Health and Safety Code (H&S) Section 33433, was provided to the City Council and the Board which reviewed: (a) the cost of the DDA to the Agency; (b) the estimated value of the property; ( c) the value of the fee interest to be conveyed; (d) how the sale of the property assists in the elimination of blight; and ( e) information to support a finding that the sale is consistent with the Agency's Five-Year Implementation Plan. She further stated that under the terms of the DDA, the proposed disposition and redevelopment ofthe property has been determined to be consistent with the Redding General Plan and exempt from the California Environmental Quality Act (CEQA). Ms. Thompson explained that under the terms of the proposed DDA, K2 will construct a 1,7 40-square- foot duplex on the property consisting of one 860-square- foot, two-bedroom unit and one 880-square-foot, two-bedroom unit, with construction being initiated prior to November 1,2009. The units will remain affordable for 55 years, with one being available to and occupied by a low-income household and the other being available to and occupied by a moderate-income household. She noted that the project also meets the goals of the Parkview Plan to provide a mix of commercial and residential development on the south side of Park view Avenue, as well as providing additional affordable housing opportunities in the Parkview Neighborhood. 8/17/2009 194 Ms. Thompson noted that the Agency's proposed financial assistance to the development includes: (1) carrying a note and deed oftrust in the amount of$61,000, the property's fair market value as established by a May 2009 appraisal, to be considered paid in full upon completion of the project; and (2) providing a 30-year, zero percent interest loan in the amount of$21O,000 from its LMIHF to assist with the construction of the units. Ms. Thompson stated that prior to the Board approving the aforementioned funding, which exceeds 50 percent ofthe project's development costs, H&S Section 33334.30) requires the Board to make findings, based on substantial evidence, that the use of the funds is necessary because the agency or owner of the units has made a good faith attempt, but been unable to obtain commercial or private means of financing the units at the same level of affordability and quantity. Accordingly, K2 has provided a letter from Cornerstone Community Bank stating that it is unable to provide financing for the project as there is insufficient loan to value, insufficient debt coverage ratio, and required builder cash injection. I It was recommended that, following the public hearing, the City Council adopt a resolution which: (1) approves the disposition of real property located at 931 Parkview Avenue to K2; (2) accepts the Summary Report pursuant to H&S Section 33433; and (3) finds that the disposition of the property will assist in the elimination of blight, is consistentwith the Implementation Plan for the Market Street Project Area, and that the consideration for the property is not less than the fair reuse value. Following the public hearing, it is recommended that the Board adopt a resolution which: (1) approves the disposition of real property located at 931 Parkview Avenue to K2; (2) accepts the Summary Report; (3) makes the required findings required by H&S Section 33433; and (4) authorizes the Chairperson to execute the D D A and ancillary documents. It was further recommended that a resolution also be adopted approving the expenditure of funds from the LMIHF for new housing units in the Parkview Neighborhood, where those funds exceed 50 percent of the cost of producing the units. In response to Council/Agency Member Dickerson, Ms. Thompson opined that the issues cited in the letter from Cornerstone Bank would be the same issues for any other bank lender. Ms. Thompson further responded that due to the rent restrictions on the property, the monthly net income of $400 after expenses, would not be sufficient to adequately debt-service the project costs without the Agency's assistance. I Mayor Bosetti and Chair Jones noted that there was no one present wishing to speak on the matter and closed the public hearings. MOTION: Made by Council Member Stegall, seconded by Council Member Jones, to adopt Resolution 2009-160, a resolution of the City Council of the City of Redding, approving the . disposition of real property located at 931 Parkview Avenue to K2 Land & Investment LLC; accepting the Summary Report pursuant to Section 33433; and finding that the disposition of the property will assist in the elimination of blight, is consistent with the Implementation Plan for the Market Street Project Area, and that the consideration for the property is not less than the fair reuse value. The Vote: AYES: NOES: ABSTAIN: ABSENT: Council Members - Dickerson, Jones, McArthur, Stegall, and Bosetti Council Members - None Council Members - None Council Members - None Resolution No. 2009-160 is on file in the office of the City Clerk. I 8/17/2009 195 I MOTION: Made by Agency Member Stegall, seconded by Agency Member Bosetti, to adopt Resolution 2009-06, a resolution of the Board of Directors of the Redding Redevelopment Agency approving the disposition of real property located at 931 Parkview Avenue to K2 Land & Investment LLC; accepting the Summary Report; making the findings required by Section 33433 ofthe Health & Safety Code; and authorizing the Chairperson to execute the Disposition and Development Agreement and ancillary documents. The Vote: ' AYES: Agency Members - Bosetti, Dickerson, McArthur, Stegall, and Jones NOES: Agency Members - None ABSTAIN: Agency Members - None ABSENT: Agency Members - None Resolution No. 2009-06 is on file in the office ofthe Redding Redevelopment Agency. ADJOURNMENT There being no further business, at the hour of5 :41 p.m., Mayor Bosetti declared the meeting adjourned. APPROVED ~:L~---_._. Mayor ATTEST: I j1Jmy 1. ~o/ Deputy City Clerk I 8/17/2009