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HomeMy WebLinkAboutMinutes - City Council - 2007-10-15 - Special Meeting 230 City Council, Special Meeting Council Chambers 777 Cypress Avenue Redding, California October 15,2007 5:15 p.m. The meeting was called to order by Mayor Dickerson with the following Council Members present: Bosetti, Jones, Murray, and Stegall. Also present were City Manager Starman, Assistant City Manager Moty, City Attorney Duvernay, Redevelopment Manager Morgon, Senior Redevelopment Project Coordinator Dent, Senior Redevelopment Project Coordinator Thompson, Senior Redevelopment Project Coordinator Haddox, Associate Redevelopment Project Coordinator Bade, City Clerk Strohmayer, and Office Services Supervisor Rudolph. I JOINT MEETING OF THE CITY COUNCIL AND REDDING REDEVELOPMENT AGENCY At the hour of 7:05 p.m., Mayor Dickerson convened the Joint Meeting with Redding Redevelopment Agency. JOINT PUBLIC HEARING - Sale of Redding Redevelopment Agency real property located at 812 Fell Street, 2742/2958/2955 Leland Avenue, and 1048/1030 Grange Street; and Resolution - Disposition and Development Agreement - Habitat for Humanity Shasta Cascade (R -030-145-050) The hour of 5: 15 p.m. having arrived, Chair Stegall and Mayor Dickerson opened the joint public hearing regarding the sale of Agency-owned property to Habitat for Humanity Shasta Cascade (Habitat). The following documents are on file in the Office of the City Clerk: I Affidavit of Publication - Notice of Public Hearing Affidavit of Mailing - Notice of Public Hearing City Clerk Strohmayer advised that no protests were received. Redevelopment Manager Morgon highlighted the Report to City Council and Redding Redevelopment Agency dated October 9, 2007, incorporated herein by reference, regarding the sale of Agency-owned property and approval of a Disposition and Development Agreement with Habitat. Mr. Morgon related that negotiations between the Agency and Habitat had been ongoing since entering into an Exclusive Negotiating Agreement (ENA) in February 2007. Under the terms of the proposed Disposition and Development Agreement (DDA), Habitat would create approximately 20 residential lots on three sites. Seventeen of the lots would be developed with three bedroom, single-family, owner-occupied residences which were affordable to families earning between 65 percent and 120 percent of the area's median income under a phased development approach. As part of the project development, Habitat would create three lots on the Lanning A venue Site for the AGREE Park units currently under construction by the Shasta Builders' Exchange Community Fund. The Agency would retain the AGREE Park lots pending relocation of the units to the Lanning A venue Site. I Mr. Morgon stated that Habitat estimates the total cost to develop the 17 affordable residences to be $4,077,303. Habitat has been awarded $90,000 in Federal Home Loan Bank funds and approximately $127,000 in California Housing Finance Agency funding. The Redding Electric Utility anticipated providing $74,000 in rebates applicable to the project. In addition, Redding Bank of Commerce will be providing construction financing. Habitat would contribute $300,000 of its own funds toward the project's construction. The Agency would provide the land and reimburse Habitat approximately $37,140 per unit for development costs, with the aggregate amount not to exceed $631,346. The average development cost per unit is approximately $240,000, with the Agency's average per-unit subsidy being $75,123, which includes the land value. 10/1512007 231 In addition to reimbursing Habitat for the costs associated with developing the 17 units, Mr. Morgon advised that the Agency would reimburse Habitat a maximum of$98,277 following the completion ofthe site work relative to the AGREE Park lots and recordation of the Final Subdivision Map for the Lanning Avenue Site. The Agency would be making available a total of approximately $144, 1 00 in Downpayment Assistance Program (DAP) loan funds for those purchasers needing additional assistance to purchase the homes. The homes would be priced at approximately $92,000 for those families earning less than 80% of Area Median Income, and at approximately $198,000 for those families earning between 81 % and 120% of Area Median Income. I Mr. Morgon explained that upon the sale of each home, a Resale Restriction Agreement would be recorded as a revocable grant to the purchaser of the home in an amount equal to the difference between the cost of constructing the unit and the purchase price paid by the buyer (the Developer Subsidy). The Resale Restriction Agreement would place resale controls on the units, as well as provide the Agency with an option to purchase the units at a restricted price in the future should the initial purchaser decide to sell. The residence would be required to remain affordable for 45 years. Should the initial purchaser sell the property at a price that is greater than the restricted sales price set by the Agency to a non- income eligible purchaser, the Developer Subsidy would be repaid to the Agency, along with any excess sales proceeds associated. with the sale. Mr. Morgon stated that before the Agency could consider the disposition of Agency-owned property acquired with tax increment monies, the sale or lease must first be approved by the City Council, by resolution, following a public hearing. He related that the Summary Report required in accordance with Section 33433 of the California Health and Safety Code, incorporated herein by reference, reviewed the following: (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 supporting a finding that the sale is consistent with the Agency's Five-Year Implementation Plan. I Mr. Morgon recommended that the City Council and the Agency's Board of Directors take the following action following the close of the public hearing: (a) approve the disposition of real property in the Parkview Neighborhood to Habitat; (b) accept the 33433 Summary Report; and (c) find that the disposition of the property would assist in the elimination of blight, is consistent with the Implementation Plan for the Market Street Redevelopment Project Area, and that the consideration for the property is not less than the fair market value of the property as determined at its highest and best use. In addition, it was recommended that the Agency's Board of Directors authorize the Chair to execute the DDA, ancillary documents, and amendments to the DDA that were reasonable and necessary to conform to lender requirements. In response to Council/Agency Member Murray, City Manager Starman explained that the Resale Restriction Agreement was prepared in consultation with outside legal counsel and serves as a deferred grant for 45 years. If the residence was sold, the forgivable grant converts to a loan which becomes due and payable upon sale. Senior Redevelopment Project Coordinator Haddox added that there was no monetary incentive for the homeowner to sell the residence for more than the established affordable price, as the Agency would recapture any net gain. I Agency/Council Member Bosetti questioned whether the DDA contained maintenance requirements. Senior Redevelopment Project Coordinator Thompson stated that one of the exhibits set forth the maintenance requirements. Elin Klaseen, Chair of the Parkview Neighborhood Association, conveyed that the Association feels that infill development was vital to the completion of the revitalization goals established for the Parkview Neighborhood. She stated that the Association looked forward to this infill development.. Jim Koenigsaecker, Executive Director for Habitat, thanked the City Council arid the Agency's Board for its ongoing support. There being no further comments, Chair Stegall and Mayor Dickerson closed the joint public hearing. 10/1512007 232 MOTION: Made by Council Member Murray, seconded by Council Member Jones, that Resolution No. 2007-196 be adopted, a resolution ofthe City Council of the City of Redding approving the disposition of real property located at 812 Fell Street, 2742/2958/2955 Leland Avenue, and 1048/1030 Grange Street in the Parkview Neighborhood to Habitat for Humanity Shasta Cascade, accepting the 33433 Summary Report, 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 market value at its highest and best use. The Vote: AYES: Council Member - Bosetti, Jones, Murray, Stegall, and Dickerson NOES: Council Member - None ABSTAIN: Council Member - None ABSENT: Council Member - None I Resolution No. 2007-196 is on file in the office of the City Clerk. There being no further business, at the hour of 7:24 p.m., Mayor Dickerson declared the meeting adjourned. APPROVED ~~ Mayor ATTEST: I ~-, -,~-1 City Clerk I 10/15/2007