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HomeMy WebLinkAbout20 - Santa Barbara Condominiums, PA2012-012���WPORr CITY OF NEWPORT BEACH gCicOPH City Council Staff Report Agenda Item No. 20 February 28, 2012 TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: Community Development Department Kimberly Brandt, AICP, Director 949 - 644 -3226, kbrandt @newportbeachca.gov PREPARED BY: Jaime Murillo, Associate Planner APPROVED: A TITLE: Santa Barbara Condominiums: Affordable Housing Implementation Plan and Memorandum of Agreement 900 Newport Center Drive (PA2012 -012) ABSTRACT: An amendment to an Affordable Housing Implementation Plan (AHIP) to allow the payment of in -lieu housing fees to satisfy the affordable housing obligations of the previously approved 79 -unit Santa Barbara Condominium Project located at 900 Newport Center Drive. The request also includes a Memorandum of Agreement (MOA) between the City of Newport Beach and the new applicant, New Home Company Southern California, LLC, specifying the payment of public benefits fees, phasing of development of the property, and waiving a requirement that the parties enter into a development agreement. This item was continued from the February 14, 2012, City Council meeting to allow the applicant to resolve terms of the purchase agreement with the property owner. This report supplements the February 14, 2012, staff report with a new draft Resolution that includes minor revisions to the MOA. This report also addresses concerns raised in a correspondence letter regarding the environmental determination. RECOMMENDATION: Adopt Resolution No. 2012 -19 (Attachment A) which: 1. Amends the Affordable Housing Implementation Plan for the Santa Barbara Condominiums Project (Exhibit 1 of Attachment A); and 2. Approves a Memorandum of Agreement between City of Newport Beach and New Home Company Southern California, LLC (Exhibit 2 of Attachment A); and 3. Waives the requirement for a development agreement; and 4. Rescinds Resolution No. 2007 -058. 1 900 Newport Center Drive (PA2012 -012) February 28, 2012 Page 2 DISCUSSION: Revised Memorandum of Agreement (MOA) This agenda item was continued from the February 14, 2012, City Council meeting to allow the applicant, New Home Company Southern California, LLC (New Home), to resolve terms of the purchase agreement with the property owner, HHR Newport Beach LLC (HHR). As a result of those discussions, HHR requested minor revisions to the draft MOA between New Home and the City of Newport Beach. Specifically, the revisions would allow for HHR to assume the rights, benefits, and obligations of New Home as set forth in the MOA should New Home not acquire the property. The revised MOA is included as Exhibit 2 of Attachment A. An underline/strikeout version of the revised MOA is also included as Attachment B. Correspondence Letter On February 14, 2012, a correspondence letter (Attachment C) was submitted by the Law Offices of Robert C. Hawkins raising concerns related to the environmental determination of the agenda item. As stated in the February 14, 2012, staff report, a Mitigated Negative Declaration (SCH No. No. 2005 - 071067) was prepared for the Santa Barbara Condominiums project in accordance with the implementing guidelines of the California Environmental Quality Act (CEQA). The document was adopted by the City Council on January 10, 2006. CEQA sets forth the presumption that once an EIR has been certified or a negative declaration (or mitigated negative declaration) has been approved, no subsequent documentation shall be prepared for the project unless very specific findings, based on substantial evidence in light of the whole record, are made by the lead agency. (CEQA Section 21166; CEQA Guidelines Section 15162.) The City has considered the claims set forth in the letter and has concluded that none of the factors cited warrant preparation of a subsequent or supplemental analysis. Three criteria are cited in CEQA Guidelines Section 15162 (Attachment D) as to when subsequent or supplemental CEQA documentation is required: (1) substantial changes are proposed in the project which will require major revisions of the previous EIR or negative declaration due to the involvement of new significant environmental effects or a substantial increase in the severity of previously identified significant effects; 2) substantial changes occur with respect to the circumstances under which the project is undertaken which will require major revisions of the previous EIR or 2 900 Newport Center Drive (PA2012 -012) February 28, 2012 Page 3 negative declaration due to the involvement of new significant environmental effects or a substantial increase in the severity of previously identified significant effects; or 3) new information of substantial importance, which was not known and could not have been known with the exercise of reasonable diligence at the time the previous EIR was certified as complete or the negative declaration was adopted shows (1) the project will have one or more significant effects not discussed in the previous document; (2) significant effects previously examined will be substantially more severe than shown in the prior document; or (c) mitigation measures or alternatives either previously found not to be feasible or considerably different from those previously considered are identified, but the project proponents decline to adopt them. With respect to the first criteria, a subsequent mitigated negative declaration for the amended AHIP and MOA is not required to be prepared pursuant to CEQA Guidelines Section 15162 because these actions do not constitute "substantial changes" to the project that would involve new significant environmental effects or a substantial increase in the severity of previously identified significant effects. The project itself — the development of 79 residential units on the project site — remains the same and the environmental impacts associated with implementation of the project have not changed. The AHIP and MOA document how the project will implement certain obligations, such as the provision of affordable housing and the payment of various development fees and public benefit contributions. These documents do not change the project, or create any new significant impacts requiring additional CEQA analysis. With respect to the second and third criteria, the information provided to the City implies that substantial changes with respect to the circumstances under which the project is being undertaken, and new information is available that warrant additional and supplemental environmental analysis. The City has considered both of these criteria in light of the information provided, and the following analysis discusses the three concerns raised and staff's response to each: 1. General Plan Update: Requirement for Development Agreement Comment: The General Plan Update that was adopted in November of 2006 requires that projects such the Santa Barbara Condominiums project in Newport Center to enter into a development agreement with the City. Response: The comment implies that the General Plan policy requirement to enter into a development agreement constitutes substantial changes to the circumstances under which the project is being undertaken which will require a major revision to the environmental analysis, or is new information that results in new significant environmental effects not previously examined. The Santa 3 900 Newport Center Drive (PA2012 -012) February 28, 2012 Page 4 Barbara Condominiums project was approved on January 10, 2006, prior to the adoption of the General Plan Update. Additionally, the General Plan policy referred to (LU 6.14.8) only requires the execution of a development agreement for residential and mixed -use development projects that use the 450 residential units added to the Newport Center Area during the General Plan Update and are identified in Table LU2 (Anomaly Locations) of the General Plan. The 79 units approved as part of the project were approved prior to the adoption of the General Plan Update and are not included within the 450 units identified in Table LU2. The requirement for a development agreement actually results from Municipal Code Chapter 15.45 that requires development agreements for projects that require a legislative act and include more than 50 residential units. This chapter was adopted on March 13, 2007, after project approval, but prior to the Coastal Commission approval that required that the City amend the Coastal Land Use Plan (legislative act) to add CLUP Policy 2.3.1 -8 requiring a $5 million fee to be paid to the Coastal Commission. As a result, the City entered into a Memorandum of Understanding with the previous applicant agreeing that the parties would enter into a development agreement that would include a $5 million Public Benefits Fee to be paid to the City, in addition to the $5 million Coastal Commission fee, in exchange for vested development rights. The subject Memorandum of Agreement (MOA) of the agenda item includes a waiver of the development agreement, but would retain the provision of a $5 million Public Benefits Fee payable to the City. As a result of this action, no revisions to the original environmental analysis would be required. No substantial changes or revisions to the original project as approved are proposed, and the potential environmental impacts and required mitigation measures remain unchanged as a result of the subsequent development agreement requirements and proposed waiver. 2. Development Agreements for Other Projects Comment: Subsequent to the approval of the Santa Barbara Condominiums project, many other projects have been approved and all have entered into development agreements: the Newport Beach Country Club, the Golf Realty Project, the North Newport Center Project, the Hyatt, and others. The only project in Newport Center which has not entered into a development agreement is the City Hall project along Avocado Avenue. Response: As indicated in the response to Comment 1, above, General Plan Policy LU 6.14.8 is not applicable to the subject 79 unit condominium project. The approval of other projects with development agreements have not resulted in new significant impacts or increased the severity of previously analyzed 21 900 Newport Center Drive (PA2012 -012) February 28, 2012 Page 5 environmental impacts of the project requiring additional CEQA analysis. It should also be noted that the Hyatt project is not located in Newport Center and required a development agreement because it involved the development of timeshare units. 3. Cumulative Impact Analysis Comment: The environmental analysis for the project did not consider the cumulative impacts of these new projects [referenced in Comment 2 above] together with project on any resources including traffic. Response: The Santa Barbara Condominiums project was the first of the referenced projects approved and the development approvals are valid until the current expiration date of September 5, 2014. As each of the other projects were analyzed by the City, the Santa Barbara Condominiums project has been included on the approved projects list for all subsequent traffic and environmental analyses that have been prepared, and therefore, all cumulative impacts of the subject project with the other identified projects have been examined as part of the cumulative impact analyses of those subsequent projects. The AHIP and MOA do not change the project's traffic impacts, and therefore do not require any changes to the cumulative analysis that has been conducted which include the subject project as an approved project. In summary, staff believes the amended AHIP and MCA do not constitute substantial revisions to the project that would involve new significant environmental effects, increase the severity of previously identified environmental impacts, or result in additional mitigation measures; nor have substantial changes occurred with respect to the circumstances under which the project is being undertaken or new information regarding new significant environmental been identified, and therefore, a subsequent mitigated negative declaration is not warranted. For the reasons set forth above, the analysis of the project's environmental impacts in Mitigated Negative Declaration (SCH No. No. 2005 - 071067) approved by the City continues to accurately describe the project and its environmental impacts. NOTICING: The agenda item has been noticed according to the Brown Act (72 hours in advance of the meeting at which the City Council considers the item) and appeared upon the agenda for this meeting, which was posted at City Hall and on the City website. Additionally, notice of this agenda item was also published in the Daily Pilot, mailed to property owners within 300 feet of the property and posted at the site a minimum of 10 days in advance of the February 14, 2012, meeting, where this item was then continued to the date of this meeting. 9 900 Newport Center Drive (PA2012 -012) February 28, 2012 Page 6 Submitted by: M L�1. 1 �I 1 91, Kimberly ' =,i . irector Attachments: A. City Council Resolution including proposed AHIP and MOA B. Underline /Strikeout Version of Revised MOA C. Correspondence Letter from Law Offices of Robert C. Hawkins D. CEQA Guidelines Section 15162 M City Council Attachment A City Council Resolution including proposed AHIP and MOA 7 2 RESOLUTION NO. 2012- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH APPROVING AN AFFORDABLE HOUSING IMPLEMENTATION PLAN AND MEMORANDUM OF AGREEMENT, AND WAIVING THE REQUIREMENT OF A DEVELOPMENT AGREEMENT FOR THE SANTA BARBARA CONDOMINIMUM PROJECT AT 900 NEWPORT CENTER DRIVE (PA2012 -012) THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH HEREBY FINDS AS FOLLOWS: SECTION 1: STATEMENT OF FACTS 1. On January 10, 2006, the City Council adopted Resolution No. 2006 -2, approving an application by Lennar Homes for the development of 79 condominium units at 900 Newport Center Drive. 2. Resolution No. 2006 -2 includes Condition No. 5, which establishes the requirements for the project to meet the affordable housing requirements in the City's Housing Element. 3. On July 25, 2006, the City Council approved a comprehensive update to the General Plan, including changes in affordable housing requirements under an updated Housing Element. 4. On March 27, 2007, the City Council adopted Ordinance No. 2007 -6, amending provisions under which development agreements shall be required for residential projects to implement new policies and land use changes in the General Plan. 5. On August 14, 2007, the City Council adopted Resolution No. 2007 -058, approving an Affordable Housing Implementation Plan (AHIP) that complied with the requirements of the updated Housing Element as satisfaction of Condition No. 5. The resolution also approved a Memorandum of Understanding (MOU) establishing an agreement between the City and Lennar Homes that a development agreement would be prepared vesting rights to develop the project as approved and establishing a public benefit contribution to the City in the amount of $5 million. 6. On May 11, 2010, the City Council adopted Ordinance No. 2010 -9, adding Chapter 19.54 (Inclusionary Housing) to the Municipal Code implementing Housing Program 2.2.1 of the Housing Element. The Chapter allows alternatives to on -site construction of affordable housing, including the I payment of in -lieu housing fees for projects of more than 50 units subject to the approval of an AHIP. 7. Lennar Homes is no longer associated with the project and New Home Company Southern California, LLC ( "New Home Company "), has requested approval of an amendment to the AHIP that complies with the requirements of the updated Housing Element, complies with the requirements of Chapter 19.54 of the Municipal Code, and satisfies Condition No. 5 of the project approval. 8. New Home Company wishes to enter into a Memorandum of Agreement (MOA) with the City to replace and supersede the previous MOU and to specify the payment of public benefit fees, phasing of development of the property, and waiving a requirement for a development agreement. SECTION 2. CALIFONIA ENVIRONMNETAL QUALITY ACT DETERMINATION A Mitigated Negative Declaration (SCH No. No. 2005 - 071067) has been prepared for the proposed project in accordance with the implementing guidelines of the California Environmental Quality Act (CEQA). The document was made available for public review and comment during a 30 -day review period from July 15 to August 15, 2005 and subsequently approved by the City Council on January 10, 2006. A subsequent mitigated negative declaration for the project is not required to be prepared pursuant to CEQA Guidelines Section 15162 because the amended AHIP and MOA do not constitute "substantial changes" to the project that would involve new significant environmental effects or result in additional mitigation measures. SECTION 3. REQUIRED FINDINGS 1. Pursuant to Section 19.54.050.A.2 of the Municipal Code, the payment of in- lieu housing fees for residential subdivisions of more than 50 units requires the approval of an AHIP. In accordance with Section 19.54.070.D of the Municipal Code, the following findings and facts in support of such findings for alternatives to on -site construction are set forth: Finding: A. The purpose of the chapter would be served by the implementation of the proposed alternative. Facts in Support of Finding: A -1 The acceptance of the fees would permit the City to exercise its discretion to direct the funding of affordable units in the City in a manner consistent with the requirements of Chapter 19.54 of the Municipal i0 Code and more effectively accomplish the goals and objectives set forth in the Housing Element. A -2 Through the acceptance of in -lieu housing fees, the City could partner with an affordable housing developer to leverage the in -lieu fees with other sources to construct or convert units for a deeper affordability level (i.e. lower- income households) in the City. A -3 Utilizing the in -lieu fees to construct, convert, or preserve affordable housing units in the City may assist in obtaining credit under the City's Regional Housing Needs Allocation (RHNA), whereas the units provided under the original AHIP would not be eligible and would not address lower- income housing needs. A -4 The City's Affordable Housing Fund currently consists of approximately $1.5 million, which is an amount that has been insufficient to assist in the development of any sizable affordable housing projects. The proposed AHIP could generate an additional $1.2 million in the Affordable Housing Fund, creating a larger fund that would be awarded to an affordable housing developer and increase a project's feasibility within the City. Finding: B. The units provided are located within the City and are consistent with the requirements of this chapter [Chapter 19.54]. Facts in Support of Finding: B -1 The in -lieu housing fees would be deposited into the City's Affordable Housing Fund, which shall be used in compliance with the General Plan Housing Element to construct, rehabilitate, or subsidize affordable housing or assist other government entities, private organizations, or individuals to provide or preserve affordable housing within the City. Finding: C. It would not be feasible or practical to construct the units on -site. Facts in Support of Finding: C -1 When the project was originally approved, it was determined that providing the required affordable units on -site would not be feasible or practical given the size, scope, design, site configuration, and location of the proposed project. 11 2. Pursuant to Section 15.45.020.0 of the Municipal Code, the City Council may waive the requirement for a development agreement. The following findings and facts in support of such findings for the waiver of a development agreement are set forth: Finding: A. The legislative act is of a minor nature, or the project provides significant public benefits to the City, or the nature of the project is such that neither the City nor the developer would benefit from a development agreement. Facts in Support of Finding: A -1 The applicant has agreed to enter into a Memorandum of Agreement (MOA) that includes the payment of a $5 million Public Benefits Fee to the City, which may be used by the City for any projects that benefit the City, in addition to the housing and park fees. A -2 Since the applicant is not seeking vesting of development rights, the City nor the applicant would benefit from a development agreement. SECTION 4. DECISION NOW, THEREFORE, BE IT RESOLVED 1. The City Council of the City of Newport Beach does hereby approve an amended Affordable Housing Implementation Plan for the Santa Barbara Condominiums Project, attached as Exhibit 1. 2. The City Council of the City of Newport Beach does hereby approve a Memorandum of Agreement between New Home Company and City of Newport Beach, attached as Exhibit 2. 3. The City Council of the City of Newport Beach does hereby waive the requirement for a development agreement. 4. Resolution No. 2007 -058 is hereby rescinded. 5. This resolution shall take effect immediately upon adoption. 6. This resolution was approved, passed and adopted at a regular meeting of the City Council of the City of Newport Beach held on February 28, 2012, by the following vote, to wit: 12 AYES, COUNCIL MEMBERS NOES, COUNCIL MEMBERS ABSENT COUNCIL MEMBERS MAYOR ATTEST: 1yr111019yIIIIIA:IN 13 Exhibit 1 Amended Affordable Housing Implementation Plan 14 The New Home Company Santa Barbara Condominiums Affordable Housing Implementation Plan City of Newport Beach, CA January 30, 2012 15 TABLE OF CONTENTS I. Executive Summary Page i- 10 New Home Company — Santa Barbara Condominiums Affordable Housing Implementation Plan I. Executive Summary Back round In January, 2006, the City of Newport Beach approved General Plan Amendment No. 2004 -005, Local Coastal Program Land Use Plan Amendment No. 2005 -001, Tentative Parcel Map No. 2005 -014, Tentative Tract Map No. 2004 -004 (TTM 16774), Traffic Study No. 2005- 002 and Coastal Residential Development Permit No. 2005 -004 and adopted Ordinance No. 2006 -1 approving Planned Community Development No. 2005 -003 amending Zoning District Map No. (48) to permit the development of 79 residential units on approximately 4.26 acres of land at 900 Newport Center Drive, known as the Santa Barbara Condominium Project (the "Project "). Condition 5 of the City Council Resolution 2006 -2 approving the project establishes the affordable housing requirement for the project, as follows: The applicant shall provide a minimum of 20% of the total units (16 units) for affordable income households in accordance with Housing Programs 2.2.1 and 2.2.3 of the Newport Beach Housing Element. The applicant shall enter into an agreement with the City to provide said units, which units may be provided off -site, at an approved location within the City. These units shall be identified in the agreement and constructed and completed prior to the issuance of any certificate of occupancy for the project. The agreement shall be reviewed and approved by the City Attorney and shall be executed and recorded prior to the recordation of the final tract map or the issuance of a building or grading permit for the proposed subdivision. The City of Newport Beach's Housing Element as approved by the City Council in July, 2006, after approval of the Project, includes an amended Housing Program 2.2.1, which sets the goal that 15% of all new housing units in the city be affordable to very low -, low- and moderate - income households. Pursuant to Section 19.54.060 of the Newport Beach Municipal Code, projects with more than 50 units are required to prepare an Affordable Housing Implementation Plan ( "AHIP ") that specifies how the development will meet the City's affordable housing goal. On May 11, 2010, the City Council adopted Ordinance No. 2010 -9 adding a new chapter to the Subdivision Code implementing Housing Program 2.2.1 of the Housing Element of the City's General Plan which allows for alternatives to on -site construction of affordable housing units, including payment of in -lieu fees for projects of fifty-one (5 1) dwelling units or more with approval of an AHIP. Summary On August 14, 2007, the City Council of the City of Newport Beach adopted Resolution 2007 -58 approving an Affordable Housing Implementation Plan for the Project (the "2007 AHIP ") as proposed by then - applicant Lennar Homes. Subsequent to approval of the 2007 AHIP, The New Home Company has entered into an agreement with the landowner of the 4.26 acre site to acquire the site and develop the Project. 27 New Home Company — Santa Barbara Condominiums Affordable Housing Implementation Plan In reviewing the provisions of the 2007 AHIP and as a result of further discussions on how the City would like to implement its inclusionary housing ordinance, the City and The New Home Company have agreed that the 2007 AHIP should be amended. The New Home Company has proposed this new 2012 Affordable Housing Implementation Plan ( "2012 AHIP ") in order to address the City's objectives and to satisfy the provisions of the City's current Inclusionary Housing requirements as set forth in Chapter 19.54 of the Newport Beach Municipal Code and the Newport Beach Housing Element. Accordingly, The New Home Company, after extensive research on options for meeting the affordable housing requirements, and in consideration of the Chapter 19.54 of the Newport Beach Municipal Code and the adopted Housing Element requirement for 15% of all new units to be affordable, agrees to meet the requirements of the City Inclusionary Housing requirements and the Housing Element as described below. II. Affordable Housing Implementation Payment of In -Lieu Fees In accordance with the provisions of Section 19.54.050 of the Newport Beach Municipal Code, The New Home Company shall pay a fee in -lieu of constructing the affordable housing units required for the Project (the "In -lieu Fee "). The In -lieu Fee shall be paid at the rate in effect at the time of the issuance of each Building Permit, as that term is defined in the Memorandum of Agreement between the City and The New Home Company, for each market rate unit. In Exhibit 2 Memorandum of Agreement 19 20 MEMORANDUM OF AGREEMENT BETWEEN THE NEW HOME COMPANY AND CITY OF NEWPORT BEACH This Memorandum of Agreement ( "MOA ") is entered into by and between The New Home Company Southern California LLC, a Delaware limited liability company ( "New Home "), and the City of Newport Beach ( "City"), a municipal corporation through its duly elected, appointed, qualified or acting representatives as of the day of February, 2012. City and New Home are sometimes collectively referred to in this MOA as the "Parties" and individually as a "Party." RECITALS A. WHEREAS, on January 10, 2006 the Newport Beach City Council approved Resolution No. 2006 -2 adopting Mitigated Negative Declaration (SCH No. 2005- 071067) and approved General Plan Amendment No. 2004 -005, Local Coastal Program Land Use Plan Amendment No. 2005 -001, Tentative Parcel Map No. 2005 -014, Tentative Tract Map No. 2004- 004 ( "TTM 16774 "), Traffic Study No. 2005 -002 and Coastal Residential Development Permit No. 2005 -004 and adopted Ordinance No. 2006 -1 approving Planned Community Development No. 2005 -003 amending Zoning District Map No. (48) for property located at 900 Newport Center Drive ( "PA 2004 - 169 ") owned in fee by HHR Newport Beach LLC, a Delaware Limited Liability Company ( "HHR ") to permit the development of 79 residential units on approximately 4.26 acres of land ( "Property") described in Exhibit "A ", B. WHEREAS, on March 27, 2007, the City Council adopted Ordinance No. 2007- 6, amending provisions under which development agreements shall be required for residential development projects in the City to implement new policies and Land Use changes in the new General Plan and requiring development agreements for projects that require a legislative act and include more than 50 units; and C. WHEREAS, on July 10, 2007 the California Coastal Commission approved City of Newport Beach Land Use Plan Amendment NPB- MAJ -1 -06 Part A (Marriott Hotel VSC to MDR/Santa Barbara Condominiums) subject to modifications; D. WHEREAS, on July 24, 2007, the City Council approved Resolution No. 2007- 56 accepting the modifications suggested by the California Coastal Commission; E. WHEREAS, on July 24, 2007, the City Council approved Resolution No. 2007- 55 approving an Affordable Housing Implementation Plan and Memorandum of Understanding for the Santa Barbara Condominium Project at 900 Newport Center Drive (PA2004 -169) with Lennar Homes of California, Inc. ( "Lennar Homes "); F. WHEREAS, on August 14, 2007, the City Council approved Resolution No. 2007 -58, which rescinded Resolution No. 2007 -55 and approved an Affordable Housing Implementation Plan ( "AHIP ") and Memorandum of Understanding ( "MOU ") for the Santa Barbara Condominium Project at 900 Newport Center Drive (PA2004 -169) with Lennar Homes; 21 G. WHEREAS, on September 5, 2007, the California Coastal Commission approved Coastal Development Permit No. 5 -07 -085 permitting the development of 79 residential townhome units ( "Project ") consistent with the City of Newport Beach Land Use Plan Amendment NPB- MAR -1 -06 Part A; H. WHEREAS, Lennar Homes no longer has an equitable or legal interest in the Property; L WHEREAS, New Home is under contract to acquire the Property from HHR and desires to develop the Project; J. WHEREAS, subsequent to the adoption of Resolution No. 2007 -58, the City adopted Municipal Code Chapter 19.54 to implement the City's inclusionary housing policies; and K. WHEREAS, the Parties have determined that as a result of changed circumstances, the Parties shall amend the prior- approved AHIP, and amend, replace and supercede the prior MOU to set forth the process by which New Home shall satisfy its Quimby Act requirements in accordance with the Subdivision Map Act (Government Code Section 66477), and provide for funding of other public benefits as may be determined by the City Council pursuant to the terms of this MOA. NOW, THEREFORE, in light of the foregoing Recitals, which are incorporated herein by this reference, and for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and in consideration of the representations, assurances, covenants and promises contained herein, the Parties agree as follows: 1. The following terms when used in this MOA shall have the meanings set forth below: 1.1 The term "AHIP" shall mean the Affordable Housing Implementation Plan approved by City on July 24, 2007, as amended by this MCA, and which is attached as Exhibit «B", 1.2 The term "MOA" shall mean this Memorandum of Agreement. 1.3 The term "Building Permit" shall mean either a combination permit or any electrical, mechanical, fire, plumbing and/or pool permit that is issued by the City to New Home for any residential building on any portion of the Property. 1.4 The term "City" shall mean the City of Newport Beach, a California Municipal Corporation and charter city. 1.5 The term "City Council" shall mean the governing body of City. 1.6 The term "Construction Codes" shall mean the Codes that are in effect at the time applicable permits are issued, including but not limited to: California Building Codes Volumes 1 and 2, including Appendix F, I, Appendix Al of Part 10, and all national codes and standards 2 22 referenced therein, based on the 2010 International Building Code, as published by the International Code Council; the California Electrical Code based on the National Electrical Code, including Annex A, B and C as published by the National Fire Protection Association; the California Plumbing Code, including Appendix Chapters A, B, D, E, F and G, based on the Uniform Plumbing Code as published by the International Association of Plumbing and Mechanical Officials; the California Mechanical Code, based on the Uniform Mechanical Code, including Appendix A as published by the International Association of Plumbing and Mechanical Officials; the "Uniform Swimming Pool, Spa, and Hot Tub Code" as published by the International Association of Plumbing and Mechanical Officials; the International Property Maintenance Code; the Newport Beach Administrative Code; the California Fire Code; and International Fire Code, as the same may be modified and amended by official action. 1.7 The term "Demolition Permit' shall mean a permit that is issued by the City enabling New Home to demolish all existing structures and improvements located on the Property. 1.8 The term "Development' or "development' shall mean the improvement of the Property for purposes of completing and effecting the structures, improvements, and facilities comprising the Project, including, without limitation, grading, the construction of infrastructure and public facilities related to the Project whether located within or outside the Property, the construction of structures and buildings and the installation of landscaping. Development also includes the maintenance, repair, or reconstruction of any building, structure, improvement, landscaping or facility after the construction and completion thereof. 1.9 The term "Effective Date" shall mean the date that New Home assumes fee title ownership of the Property. 1.10 The term "Foundation Permit' shall mean the permit that is issued to allow construction of the concrete structure that will serve as the foundation for the buildings to be constructed as the Project following all demolition, clearing and grading work required on the Property. 1.11 The term "General Plan" shall mean the City of Newport Beach General Plan, as the General Plan exists as of the Effective Date of this Agreement. 1.12 The term "Rough Grading Permit' shall mean the permit that is issued by the City enabling New Home to accomplish the rough grading of the Property. 1.13 The term "Precise Grading Permit' shall mean the permit that is issued by the City enabling New Home to accomplish the precise grading of the Property, together with the installation of any requisite infrastructure to be located on the Property 1.14 The term "Master Site Plan" shall mean the Master Site Plan for the development of the Property attached hereto as Exhibit "C ". 1.15 The term "Municipal Code" shall refer to the City of Newport Beach Municipal Code, as the same now exists or may be further amended from time to time consistent with this Agreement. 23 1.16 The term "Other Permits" shall mean either the Rough Grading Permit or Demolition Permit. 1.17 The term "Project" shall mean the development of the Property pursuant to the conceptual plan for development of the Project on the Property is depicted on the conceptual Master Site Plan attached hereto as Exhibit "C ". 1.18 The term "Residential Permit" shall mean either the Precise Grading Permit, Foundation Permit or the Building Permit. 2. TERM. 2.1 The term of this MOA shall commence on the Effective Date and shall continue thereafter for a period of ten (10) years, unless this MOA is terminated, modified, or extended by circumstances set forth in this MOA or by mutual written consent of the Parties. None of the obligations of New Home as set forth in Sections 3.1 through and inclusive of 3.3, below, with respect to the provision of Public Benefits, and the obligations of City with respect to development of the Property as set forth in Section 4., below, shall arise until after New Home assumes title to the Property. 2.2 Notwithstanding the foregoing Section, the provisions of this MOA shall terminate sixty (60) days after the date upon which the certificate of occupancy for the final residential condominium unit authorized for the project. 3. PUBLIC BENEFITS. 3.1 AHIP and Affordable Housing Fee. The AHIP, attached as Exhibit "B," provides for the payment of affordable housing fees at the rate in effect at the time the fees are paid pursuant to the schedule set forth in this MOA consistent with NBMC 19.54. The payment of the Affordable Housing In -Lieu Fee replaces the prior AHIP requirement to purchase covenants to guarantee the affordability of an existing 12- unit apartment building. The Affordable Housing In -Lieu Fee shall be paid at the rate in effect upon the issuance of each Building Permit for each unit. As New Home and the City agree that New Home's affordable housing obligations pursuant to Chapter 19.54 of the Municipal Code shall be satisfied by the payment of in -lieu fees, the parties further agree that the requirements of Section 19.54.080 of the City Municipal Code have been addressed and are satisfied. 4 24 3.2 Quimby Act Fee. The Project shall pay in -lieu park fees which shall satisfy its obligations under the Quimby Act, Government Code Section 66477. The Quimby Act fee shall be paid on a pro rata basis at the rate in effect upon the issuance of each Building Permit for each unit. 3.3 Public Benefits Fee. The Project shall pay to the City a Public Benefits Fee of $63,291 per unit, for a total of $5,000,000, which shall be used by the City to fund projects for the benefit of the public. The Public Benefits Fee shall be paid on a pro -rata basis upon the issuance of each certificate of occupancy for each unit. 3.4 Conformity with Ordinance No. 2007 -6 and Waiver of Development Agreement. In light of the City's approval of Resolution No. 2006 -2 and Ordinance No. 2006 -1 prior to adoption of Ordinance No. 2007 -6, the public benefits that shall be provided to the City pursuant to this MOA, the Project's commitment to implement new policies and land use changes in the General Plan, and the Project's provision of those public benefits identified by the City to support implementation of the General Plan as set forth in this MOA, pursuant to Municipal Code Section 15.45.020 (CI), the City hereby waives the requirement that the Parties enter into a development agreement. 4. DEVELOPMENT OF THE PROPERTY. 4.1 Separate Permits. New Home may request and, upon approval of the plans therefor and payment of the appropriate fees, City shall issue separate permits, as follows:(a) the Demolition Permit, (b) the Rough Grading Permit (collectively, "Other Permits "), (c) Precise Grading Permit, (d) the Foundation Permit, and (e) the Building Permit (collectively, "Residential Permit "). The City, upon application from New Home, agrees to issue the Other Permits prior to recordation of any required final subdivision map or condominium plan for the Project. 4.2 Phases/Buildings. City shall apply the regulations then in effect to allow the development of the Project in two (2) separate and distinct phases as shown on the Master Site Plan depicted on Exhibit "C" attached hereto. In addition, for all purposes applicable thereto under the Construction Codes and the applicable Building Codes building and land use regulations, the five (5) Buildings shown on Exhibit "C" shall each be considered a separate Building, although all or some of such Buildings shall share a common garage on a subterranean level. 4.3 Sales Trailer. Upon approval of the site plan therefor and payment of the appropriate fees, City shall allow and issue appropriate permits for the installation and use of a mobile trailer as a temporary sales trailer for the Project on the Phase II area of the Property. 5. ASSIGNMENT. New Home, and HHR subject to the provisions of Section 6. 1, below, shall have the right to assign its rights and obligations under this MOA without City's consent, in connection with a 25 transfer of New Home's or HHR's interest in the Property provided that no partial transfer shall violate the Subdivision Map Act (California Government Code Sections 66410 - 66499.58). In the event of any such assignment, the assignee shall be liable for the performance of all obligations of New Home or HHR with respect to the portion of the Property so transferred. Following an assignment or transfer of any of the rights and interest of New Home or HHR set forth in this MOA in accordance with this Section, the assignee's exercise, use and enjoyment of the Property shall be subject to the terms of this MOA to the same extent as if the assignee or transferee were New Home or HHR. 6. MISCELLANEOUS PROVISIONS. 6.1 Covenants. The provisions of this MOA shall constitute covenants which shall run with the land comprising the Property for the benefit thereof, and the burdens and benefits hereof shall bind and inure to the benefit of each of the Parties hereto and all successors in interest to the Parties hereto. The Parties agree that in the event New Home does not assume title to the Property, the rights, benefits and obligations of New Home set forth in this MOA shall inure to the benefit of and be assumed by HHR, the fee owner of the Property. 6.2 Severability. If any term, provision, covenant, or condition of this MOA is held by a court of competent jurisdiction to be invalid, void, or unenforceable, the remaining provisions of this MOA shall continue in full force and effect, unless and to the extent the rights and obligations of any Party has been materially altered or abridged by such holding. 6.3 Counterparts. This MOA may be executed in counterparts, each of which shall be considered a duplicate original. 6.4 Governing Law. This MOA shall be governed by, and construed and enforced in accordance with, the laws of the State of California. 6.5 Entire Agreement; Waivers and Amendments. This MOA constitutes the entire understanding and agreement of the Parties and supersedes all previous negotiations, discussions, and agreements among the Parties with respect to all or part of the subject matter hereof. No parole evidence of any prior or other agreement shall be permitted to contradict or vary the terms of this MOA. Failure by a Party to insist upon the strict performance of any of the provisions of this MOA by any other Party, or the failure by a Party to exercise its rights upon the default of the other Party, shall not constitute a waiver of such Party's right to insist and demand strict compliance by the other Parties with the terms of this MOA. Any amendments or modifications to this MOA must be in writing, signed by duly authorized representatives of each of the Parties hereto. The MOU that was approved by the City pursuant to Resolution No. 2007 -58 is of no force and effect and has been replaced and superseded in its entirety by this MOA. DEFAULT, REMEDIES, AND TERMINATION. 7.1 Notice and Opportunity to Cure. Before this MOA may be terminated or action may be taken to obtain judicial relief, the Party seeking relief ( "Nondefaulting Party ") shall comply with the notice and cure provisions of this Section. A Nondefaulting Party in its 6 20 discretion may elect to declare a default under this Agreement in accordance with the procedures hereinafter set forth for any failure or breach of any other Party ( "Defaulting Party ") to perform any material duty or obligation of said Defaulting Party in accordance with the terms of this MOA. However, the Non - Defaulting Party must provide written notice to the Defaulting Party setting forth the nature of the breach or failure and the actions, if any, required by the Nondefaulting Party to cure such breach or failure. The Defaulting Party shall be deemed in "default" of its obligations set forth in this MOA if the Defaulting Party has failed to take action and cured the default within ten (10) days after the date of such notice (for monetary defaults), within thirty (30) days after the date of such notice (for non - monetary defaults), or within such lesser time as may be specifically provided for in this MOA. If, however, a non - monetary default cannot be cured within such thirty (30) day period, as long as the Defaulting Party does each of the following: (i) notifies the Non - Defaulting Party in writing with a reasonable explanation as to the reasons the asserted default is not curable within the thirty (30) day period and provides a proposed course of action to cure the default; (ii) promptly commences to cure the default within the thirty (30) day period; (iii) makes periodic reports to the Non - Defaulting Party as to the progress of the program of cure; and (iv) diligently prosecutes such cure to completion, then the Defaulting Party shall not be deemed in breach of this MOA. Notwithstanding the foregoing, the Defaulting Party shall be deemed in default of its obligations set forth in this MOA if said breach or failure involves the payment of money but the Defaulting Party has failed to completely cure said monetary default within ten (10) days (or such lesser time as may be specifically provided in this MOA) after the date of such notice. 7.2 Default Remedies. Subject to Section 7.3, in the event of a default, the Non - Defaulting Party, at its option, may institute legal action to cure, correct, or remedy such default, enjoin any threatened or attempted violation, enforce the terms of this MOA by specific performance, or pursue any other legal or equitable remedy. 7.3 New Home's Exclusive Remedy. The Parties acknowledge that City would not have entered into this MOA if it were to be liable in damages under or with respect to this MOA, or the application thereof, or any permit or approval sought by New Home in accordance herewith. Accordingly, New Home covenants, on behalf of itself and its successors and assigns, not to sue City for damages or monetary relief for any breach of this MOA or arising out of or connected with any dispute, controversy or issue regarding the application, interpretation of effect of this MOA, or any land use permit or approval sought in connection with the development or use of the Property or any portion thereof, the Parties agreeing that declaratory and injunctive relief, mandate, and specific performance shall be New Home's sole and exclusive judicial remedies. 7.4 Force Maieure. The obligations by any Party hereunder shall not be deemed to be in default where delays or failures to perform are due to any cause without the fault and beyond the reasonable control of such Party, including to the extent applicable, the following: war; insurrection; strikes; walk -outs; the unavailability or shortage of labor, materials, or equipment; riots; floods; earthquakes; the discovery and resolution of hazardous waste or significant geologic, hydrologic, archaeological, paleontologic, or endangered species problems on the Property; fires; casualties; acts of God; governmental restrictions imposed or mandated by other governmental entities; with regard to delays of New Home's performance, delays caused by City's failure to act or timely perform its obligations set forth herein; with regard to delays of City's performance, delays caused by a New Home's failure to act or timely perform its 7 27 obligations set forth herein; inability to obtain necessary permits or approvals from other governmental entities; enactment of conflicting state or federal statutes or regulations; judicial decisions; or litigation not commenced by such Party. Notwithstanding the foregoing, any delay caused by the failure of City or any agency, division, or office of City to timely issue a license, permit, or approval required pursuant to this MOA shall not constitute an event of force majeure extending the time for City's performance hereunder. If written notice of such delay or impossibility of performance is provided to the other Parties within a reasonable time after the commencement of such delay or condition of impossibility, an extension of time for such cause will be granted in writing for the period of the enforced delay, or longer as may be mutually agreed upon by the Parties in writing, or the performance rendered impossible may be excused in writing by the Party so notified. In no event shall adverse market or financial conditions constitute an event of force majeure extending the time for such Party's performance hereunder. 8. NOTICES. Any demand upon or notice required or permitted to be given by one party to the other shall be in writing, shall be made in the following manner, and shall be effective (a) upon receipt if given by personal delivery, (b) on the date indicated on the receipt if given by certified or registered mail, return receipt requested, or (c) on the succeeding business day after mailing or deposit if given by Express Mail or by deposit with a private delivery service of general use (e.g., Federal Express), postage or fee paid, as appropriate, addressed to the parties as set forth below. Notice of a change of address shall be given by written notice in the manner set forth in this section. For the purposes of this MOA, all information, requests, or other business including any demand upon a party or notice pursuant hereto shall be coordinated through the following agency representatives: City of Newport Beach Attn: David Kiff, City Manager (with copy to City Attorney's Office) 3300 Newport Blvd. Newport Beach, CA 92658 -8915 The New Home Company Southern California LLC Tom Redwitz, President 95 Enterprise, Suite 325 Aliso Viejo, CA 92656 IN WITNESS WHEREOF, City and New Home have executed this MOA as of the date first written above. [SIGNATURES ON THE FOLLOWING PAGE] go ATTEST: Leilani Brown City Clerk APPROVED AS TO FORM: By: Aaron Harp City Attorney *211 '7 CITY OF NEWPORT BEACH, A Municipal Coiporation Nancy Gardner Mayor THE NEW HOME COMPANY SOUTHERN CALIFORNIA LLC, a Delaware Limited Liability Company C Tom Redwitz President 29 EXHIBIT "A" LEGAL DESCRIPTION OF THE PROPERTY 10 30 Exhibit "A" Legal Description PARCEL 1, IN THE CITY OF NEWPORT BEACH, COUNTY OF ORANGE, STATE OF CALIFORNIA, AS PER MAP 2004 -225 FILED IN BOOK 361 PAGES 1, 2 AND 3 OF PARCEL MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY, AS MODIFIED BY THE PARCEL MAP CERTIFICATE OF CORRECTION RECORDED APRIL 23, 2008 AS INSTRUMENT NO. 2008000190230. EXCEPT ANY AND ALL OIL, OIL RIGHTS, MINERALS, MINERAL RIGHTS, NATURAL GAS RIGHTS, AND OTHER HYDROCARBONS BY WHATSOEVER NAME KNOWN, GEOTHERMAL STEAM AND ALL PRODUCTS DERIVED FROM ANY OF THE FOREGOING, THAT MAY BE WITHIN OR UNDER THE PARCEL OF LAND HEREINABOVE DESCRIBED, TOGETHER WITH THE PERPETUAL RIGHT OF DRILLING, MINING, EXPLORING AND OPERATING THEREFOR AND STORING IN AND REMOVING THE SAME FROM SAID LAND OR ANY OTHER LAND, INCLUDING THE RIGHT TO WHIPSTOCK OR DIRECTIONALLY DRILL AND MINE FROM LANDS OTHER THAN THOSE HEREINABOVE DESCRIBED, OIL OR GAS WELLS, TUNNELS AND SHAFTS INTO, THROUGH OR ACROSS THE SUBSURFACE OF THE LAND HEREINABOVE DESCRIBED, AND TO BOTTOM SUCH WHIPSTOCKED OR DIRECTIONALLY DRILLED WELLS, TUNNELS AND SHAFTS UNDER AND BENEATH OR BEYOND THE EXTERIOR LIMITS THEREOF, AND TO REDRILL, RETUNNEL, EQUIP, MAINTAIN, REPAIR, DEEPEN AND OPERATE ANY SUCH WELLS OR MINES; WITHOUT, HOWEVER, THE RIGHT TO DRILL, MINE, STORE, EXPLORE AND OPERATE THROUGH THE SURFACE OR THE UPPER 500 FEET OF THE SUBSURFACE OF THE LAND AS RESERVED IN THE DEED FROM THE IRVINE COMPANY, A MICHIGAN CORPORATION, RECORDED JANUARY 4, 1993 AS INSTRUMENT NO. 93- 003605, OFFICIAL RECORDS ALSO EXCEPT ANY AND ALL WATER, RIGHTS OR INTERESTS THEREIN, NO MATTER HOW ACQUIRED BY GRANTOR, AND OWNED OR USED BY GRANTOR IN CONNECTION WITH OR WITH RESPECT TO THE LAND, TOGETHER WITH THE RIGHT AND POWER TO EXPLORE, DRILL, REDRILL, REMOVE AND STORE THE SAME FROM THE LAND OR TO DIVERT OR OTHERWISE UTILIZE SUCH WATER, RIGHTS OR INTERESTS ON ANY OTHER PROPERTY OWNED OR LEASED BY GRANTOR, WHETHER SUCH WATER RIGHTS SHALL BE RIPARIAN, OVERLYING, APPROPRIATIVE, LITTORAL, PERCOLATING, PRESCRIPTIVE, ADJUDICATED, STATUTORY OR CONTRACTUAL; BUT WITHOUT, HOWEVER, ANY RIGHT TO ENTER UPON THE SURFACE OF THE LAND IN THE EXERCISE OF SUCH RIGHTS, AS RESERVED IN THE DEED FROM THE IRVINE COMPANY, A MICHIGAN CORPORATION, RECORDED JANUARY 4, 1993 AS INSTRUMENT NO. 93- 003805, OFFICIAL RECORDS. I I 31 EXHIBIT "B" AFFORDABLE HOUSING IMPLEMENTATION PLAN 12 S2 The New Home (Compan y Santa Barbara (Condominiums Affordable Housing Implementation Plan City ®f Newport Beach, CA January 3 09 2012 33 TABLE OF CONTENTS Page 1. Executive Summary ............................................................................ ............................... I Background Summary... Affordable Noosing Implementat ion ............ ............................... Payment of In -Lieu Fees S4 New Home Company — Santa Barbara Condominiums Affordable Housing Implementation Plan Page I Executive Summary Background In January, 2006, the City of Newport Beach approved General Plan Amendment No. 2004 -005, Local Coastal Program Land Use Plan Amendment No. 2005 -001, Tentative Parcel Map No. 2005 -014, Tentative Tract ivlap No. 2004 -004 (TTNl 16774), Traffic Study No. 2005- 002 and Coastal Residential Development Permit No. 2005 -004 and adopted Ordinance No. 2006 -1 approving Planned Community Development No. 2005 -003 amending Zoning District Map No. (48) to permit the development of 79 residential units on approximately 4.26 acres of land at 900 Newport Center Drive, known as the Santa Barbara Condominium Project (the `Project "). Condition 5 of the City Council Resolution 2006 -2 approving the project establishes the affordable housing requirement for the project, as follows: The applicant shall provide a rnininnon of 20% of the total unils (16 unils) far affordable income households in accordance wilh Housing Programs 2.2.1 cued 2.2.3 of the Afewport Beach Housing Element. Tlue appliccwl shall enter into an agg7•eemenl with the Cily to provide said writs, which wails may be provided off -she, at an approved location within the City. These wails shall be idcnliTed in the agreement and constructed and couq)leted prior to the issuance of any c•eri Jicale of ocarperncy for the proiect. The agreement shall be reviewed and approved by the Cily dllorney and shall be executed and recorded prior to the recordation of the final n•acl Harp or the issuance of a building or grading perauil fa• the proposed subdivision. The City of Newport Beach's Housing Element as approved by the City Cooncil in July, 2006, after approval of the Project, includes an amended Housing Program 2.2.1, which sets the goal that 15% of all new housing units in the city be affordable to very low -, low- and moderate - inconne households. Pursuant to Section 19.54.060 of the Newport Beach Municipal Code, projects with more than 50 units are required to prepare an Affordable Housing Lnplementation Plan ( "AHIP ") that specifies how the development will meet the City's affordable housing goal. On May 11, 2010, the City Council adopted Ordinance No. 2010 -9 adding a new chapter to the Subdivision Code implementing Housing Program 2.2.1 of the Housing Element of the City's General Plan which allows for alternatives to on -site construction of affordable housing Units, including payment of in -lieu fees for projects of fifty -one (5 1) dwelling units or more with approval of an AH1P. Summary On August 14, 2007, the City Council of the City of Newport Beach adopted Resolution 2007 -58 approving an Affordable Housing Implementation Plan for the Project (the "2007 AMP") as proposed by then - applicant Lennar Homes. Subsequent to approval of the 2007 AHIP, The New Home Company has entered into an agreement with the landowner of the 4.26 acre site to acquire the site and develop the Project. 35 New Home Company — Santa Barbara Condominiums Affordable Housing Implementation Plan Page 2 In reviewing the provisions of the 2007 AHfP and as a result of further discussions on how the City would like to implement its inclusionary housing ordinance, the City and The New Home Company have agreed that the 2007 AHIP should be amended. The New Home Company has proposed this new 2012 Affordable Housing Implementation Plan ("2012 ARM ") in order to address the City's objectives and to satisfy the provisions of the City's current buclusionary Housing requirements as set forth in Chapter 19.54 of the Newport Beach Municipal Code and the Newport Beach Housing Element. Accordingly, The New Home Company, after extensive research oil options for meeting the affordable housing requirements; and in consideration of the Chapter 19.54 of the Newport Beach Municipal Code and the adopted Housing Element requirement for 15% of all new units to be affordable, agrees to meet the requirements of the City Inclusionary Housing requirements and the Housing Element as described below. II. Affordable Housing Implementation Payment of In -Lieu Fees In accordance with the provisions of Section 19.54.050 of the Newport Beach Municipal Code, The New Home Company shall; pay a fee in -lieu of constructing the affordable housing units required for the Project (the "In -lieu Fee"), The In -lieu Fee shall be paid at the rate in effect at the time of the issuance of each Building Permit, as that term is defined in the Memorandum of Agreement between the City and The New Home Company, for each market rate unit. so EXHIBIT "C" MASTER SITE PLAN 13 37 S2 9 D m N mm 3 N m m a a r D z EPT 9 2 D m m m 9 z 2 k z. i �anLaRarbara condominiums Newport Beach, Ca. 39 IN City Council Attachment B Underline /Strikeout Version of Revised MOA 41 42 MEMORANDUM OF AGREEMENT BETWEEN THE NEW HOME COMPANY AND CITY OF NEWPORT BEACH This Memorandum of Agreement ( "MOA ") is entered into by and between The New Home Company Southern California LLC, a Delaware limited liability company ( "New Home "), and the City of Newport Beach ( "City"), a municipal corporation through its duly elected, appointed, qualified or acting representatives as of the day of February, 2012. City and New Home are sometimes collectively referred to in this MOA as the "Parties" and individually as a "Party." RECITALS A. WHEREAS, on January 10, 2006 the Newport Beach City Council approved Resolution No. 2006 -2 adopting Mitigated Negative Declaration (SCH No. 2005- 071067) and approved General Plan Amendment No. 2004 -005, Local Coastal Program Land Use Plan Amendment No. 2005 -001, Tentative Parcel Map No. 2005 -014, Tentative Tract Map No. 2004- 004 ( "TTM 16774 "), Traffic Study No. 2005 -002 and Coastal Residential Development Permit No. 2005 -004 and adopted Ordinance No. 2006 -1 approving Planned Community Development No. 2005 -003 amending Zoning District Map No. (48) for property located at 900 Newport Center Drive ( "PA 2004 - 169 ") owned in fee by HHR Newport Beach LLC, a Delaware Limited Liability Company ( "HHR ") to permit the development of 79 residential units on approximately 4.26 acres of land ( "Property") described in Exhibit "A ", B. WHEREAS, on March 27, 2007, the City Council adopted Ordinance No. 2007- 6, amending provisions under which development agreements shall be required for residential development projects in the City to implement new policies and Land Use changes in the new General Plan and requiring development agreements for projects that require a legislative act and include more than 50 units; and C. WHEREAS, on July 10, 2007 the California Coastal Commission approved City of Newport Beach Land Use Plan Amendment NPB- MAJ -1 -06 Part A (Marriott Hotel VSC to MDR/Santa Barbara Condominiums) subject to modifications; D. WHEREAS, on July 24, 2007, the City Council approved Resolution No. 2007- 56 accepting the modifications suggested by the California Coastal Commission; E. WHEREAS, on July 24, 2007, the City Council approved Resolution No. 2007- 55 approving an Affordable Housing Implementation Plan and Memorandum of Understanding for the Santa Barbara Condominium Project at 900 Newport Center Drive (PA2004 -169) with Lennar Homes of California, Inc. ( "Lennar Homes "); F. WHEREAS, on August 14, 2007, the City Council approved Resolution No. 2007 -58, which rescinded Resolution No. 2007 -55 and approved an Affordable Housing Implementation Plan ( "AHIP ") and Memorandum of Understanding ( "MOU ") for the Santa Barbara Condominium Project at 900 Newport Center Drive (PA2004 -169) with Lennar Homes; ijim G. WHEREAS, on September 5, 2007, the California Coastal Commission approved Coastal Development Permit No. 5 -07 -085 permitting the development of 79 residential townhome units ( "Project ") consistent with the City of Newport Beach Land Use Plan Amendment NPB- MAR -1 -06 Part A; H. WHEREAS, Lennar Homes no longer has an equitable or legal interest in the Property; L WHEREAS, New Home is under contract to acquire the Property from HHR and desires to develop the Project; J. WHEREAS, subsequent to the adoption of Resolution No. 2007 -58, the City adopted Municipal Code Chapter 19.54 to implement the City's inclusionary housing policies; and K. WHEREAS, the Parties have determined that as a result of changed circumstances, the Parties shall amend the prior- approved AHIP, and amend, replace and supercede the prior MOU to set forth the process by which New Home shall satisfy its Quimby Act requirements in accordance with the Subdivision Map Act (Government Code Section 66477), and provide for funding of other public benefits as may be determined by the City Council pursuant to the terms of this MOA. NOW, THEREFORE, in light of the foregoing Recitals, which are incorporated herein by this reference, and for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and in consideration of the representations, assurances, covenants and promises contained herein, the Parties agree as follows: 1. The following terms when used in this MOA shall have the meanings set forth below: 1.1 The term "AHIP" shall mean the Affordable Housing Implementation Plan approved by City on July 24, 2007, as amended by this MCA, and which is attached as Exhibit «B", 1.2 The term "MOA" shall mean this Memorandum of Agreement. 1.3 The term "Building Permit" shall mean either a combination permit or any electrical, mechanical, fire, plumbing and/or pool permit that is issued by the City to New Home for any residential building on any portion of the Property. 1.4 The term "City" shall mean the City of Newport Beach, a California Municipal Corporation and charter city. 1.5 The term "City Council" shall mean the governing body of City. 1.6 The term "Construction Codes" shall mean the Codes that are in effect at the time applicable permits are issued, including but not limited to: California Building Codes Volumes 1 and 2, including Appendix F, I, Appendix Al of Part 10, and all national codes and standards 2 44 referenced therein, based on the 2010 International Building Code, as published by the International Code Council; the California Electrical Code based on the National Electrical Code, including Annex A, B and C as published by the National Fire Protection Association; the California Plumbing Code, including Appendix Chapters A, B, D, E, F and G, based on the Uniform Plumbing Code as published by the International Association of Plumbing and Mechanical Officials; the California Mechanical Code, based on the Uniform Mechanical Code, including Appendix A as published by the International Association of Plumbing and Mechanical Officials; the "Uniform Swimming Pool, Spa, and Hot Tub Code" as published by the International Association of Plumbing and Mechanical Officials; the International Property Maintenance Code; the Newport Beach Administrative Code; the California Fire Code; and International Fire Code, as the same may be modified and amended by official action. 1.7 The term "Demolition Permit' shall mean a permit that is issued by the City enabling New Home to demolish all existing structures and improvements located on the Property. 1.8 The term "Development' or "development' shall mean the improvement of the Property for purposes of completing and effecting the structures, improvements, and facilities comprising the Project, including, without limitation, grading, the construction of infrastructure and public facilities related to the Project whether located within or outside the Property, the construction of structures and buildings and the installation of landscaping. Development also includes the maintenance, repair, or reconstruction of any building, structure, improvement, landscaping or facility after the construction and completion thereof. 1.9 The term "Effective Date" shall mean the date that New Home assumes fee title ownership of the Property. 1.10 The term "Foundation Permit' shall mean the permit that is issued to allow construction of the concrete structure that will serve as the foundation for the buildings to be constructed as the Project following all demolition, clearing and grading work required on the Property. 1.11 The term "General Plan" shall mean the City of Newport Beach General Plan, as the General Plan exists as of the Effective Date of this Agreement. 1.12 The term "Rough Grading Permit' shall mean the permit that is issued by the City enabling New Home to accomplish the rough grading of the Property. 1.13 The term "Precise Grading Permit' shall mean the permit that is issued by the City enabling New Home to accomplish the precise grading of the Property, together with the installation of any requisite infrastructure to be located on the Property 1.14 The term "Master Site Plan" shall mean the Master Site Plan for the development of the Property attached hereto as Exhibit "C ". 1.15 The term "Municipal Code" shall refer to the City of Newport Beach Municipal Code, as the same now exists or may be further amended from time to time consistent with this Agreement. Ilf 1.16 The term "Other Permits" shall mean either the Rough Grading Permit or Demolition Permit. 1.17 The term "Project" shall mean the development of the Property pursuant to the conceptual plan for development of the Project on the Property is depicted on the conceptual Master Site Plan attached hereto as Exhibit "C ". 1.18 The term "Residential Permit" shall mean either the Precise Grading Permit, Foundation Permit or the Building Permit. 2. TERM. 2.1 The term of this MOA shall commence on the Effective Date and shall continue thereafter for a period of ten (10) years, unless this MOA is terminated, modified, or extended by circumstances set forth in this MOA or by mutual written consent of the Parties. None of the obligations of New Home as set forth in Sections 3.1 through and inclusive of 3.3, below, with respect to the provision of Public Benefits, and the obligations of City with respect to development of the Property as set forth in Section 4., below, shall arise until after New Home assumes title to the Property. 2.2 Notwithstanding the foregoing Section, the provisions of this MOA shall terminate sixty (60) days after the date upon which the certificate of occupancy for the final residential condominium unit authorized for the project. 3. PUBLIC BENEFITS. 3.1 AHIP and Affordable Housing Fee. The AHIP, attached as Exhibit `B." provides for the payment of affordable housing fees at the rate in effect at the time the fees are paid pursuant to the schedule set forth in this MOA consistent with NBMC 19.54. The payment of the Affordable Housing In -Lieu Fee replaces the prior AHIP requirement to purchase covenants to guarantee the affordability of an existing 12- unit apartment building. The Affordable Housing In -Lieu Fee shall be paid at the rate in effect upon the issuance of each Building Permit for each unit. As New Home and the City agree that New Home's affordable housing obligations pursuant to Chapter 19.54 of the Municipal Code shall be satisfied by the payment of in -lieu fees, the parties further agree that the requirements of Section 19.54.080 of the City Municipal Code have been addressed and are satisfied. 4 40 3.2 Quimby Act Fee. The Pfopes € d- Project shall pay in -lieu park fees which shall satisfy its obligations under the Quimby Act, Government Code Section 66477. The Quimby Act fee shall be paid on a pro rata basis at the rate in effect upon the issuance of each Building Permit for each unit. 3.3 Public Benefits Fee. The Project shall pay to the City a Public Benefits Fee of $63,291 per unit, for a total of $5,000,000, which shall be used by the City to fund projects for the benefit of the public. The Public Benefits Fee shall be paid on a pro -rata basis upon the issuance of each certificate of occupancy for each unit. 3.4 Conformity with Ordinance No. 2007 -6 and Waiver of Development Agreement. In light of the City's approval of Resolution No. 2006 -2 and Ordinance No. 2006 -1 prior to adoption of Ordinance No. 2007 -6, the public benefits that shall be provided to the City pursuant to this MOA, and -the P + epesed- Project's commitment to implement new policies and land use changes in the General Plan, and the grepesed- Project's provision of those public benefits identified by the City to support implementation of the General Plan as set forth in this MOA, pursuant to Municipal Code Section 15.45.020 (CI), the City hereby waives the requirement that the Parties enter into a development agreement. 4. DEVELOPMENT OF THE PROPERTY. 4.1 Separate Permits. New Home may request and, upon approval of the plans therefor and payment of the appropriate fees, City shall issue separate permits, as follows:(a) the Demolition Permit, (b) the Rough Grading Permit (collectively, "Other Permits "), (c) Precise Grading Permit, (d) the Foundation Permit, and (e) the Building Permit (collectively, "Residential Permit "). The City, upon application from New Home, agrees to issue the Other Permits prior to recordation of any required final subdivision map or condominium plan for the Project. 4.2 Phases/Buildings. City shall apply the regulations then in effect to allow the development of the Project in two (2) separate and distinct phases as shown on the Master Site Plan depicted on Exhibit "C" attached hereto. In addition, for all purposes applicable thereto under the Construction Codes and the applicable Building Codes building and land use regulations, the five (5) Buildings shown on Exhibit "C" shall each be considered a separate Building, although all or some of such Buildings shall share a common garage on a subterranean level. 4.3 Sales Trailer. Upon approval of the site plan therefor and payment of the appropriate fees, City shall allow and issue appropriate permits for the installation and use of a mobile trailer as a temporary sales trailer for the Project on the Phase II area of the Property. 5. ASSIGNMENT. New Home, and HHR subject to the provisions of Section 6. 1, below, shall have the right to assign its rights and obligations under this MOA without City's consent, in connection with a 47 transfer of New Home's or HHR's interest in the Property provided that no partial transfer shall violate the Subdivision Map Act (California Government Code Sections 66410 - 66499.58). In the event of any such assignment, the assignee shall be liable for the performance of all obligations of New Home or HER with respect to the portion of the Property so transferred. Following an assignment or transfer of any of the rights and interest of New Home or HHR set forth in this MOA in accordance with this Section, the assignee's exercise, use and enjoyment of the Property shall be subject to the terms of this MOA to the same extent as if the assignee or transferee were New Home or HHR. 6. MISCELLANEOUS PROVISIONS. 6.1 Covenants. The provisions of this MOA shall constitute covenants which shall run with the land comprising the Property for the benefit thereof, and the burdens and benefits hereof shall bind and inure to the benefit of each of the Parties hereto and all successors in interest to the Parties hereto. The Parties agree that in the event New Home does not assume title to the Property, the rights, benefits and obligations of New Home set forth in this MOA shall inure to the benefit of and be assumed by HHR, the fee owner of the PropertV. 6.2 Severability. If any term, provision, covenant, or condition of this MOA is held by a court of competent jurisdiction to be invalid, void, or unenforceable, the remaining provisions of this MOA shall continue in full force and effect, unless and to the extent the rights and obligations of any Party has been materially altered or abridged by such holding. 6.3 Counterparts. This MOA may be executed in counterparts, each of which shall be considered a duplicate original. 6.4 Governing Law. This MOA shall be governed by, and construed and enforced in accordance with, the laws of the State of California. 6.5 Entire Agreement; Waivers and Amendments. This MOA constitutes the entire understanding and agreement of the Parties and supersedes all previous negotiations, discussions, and agreements among the Parties with respect to all or part of the subject matter hereof. No parole evidence of any prior or other agreement shall be permitted to contradict or vary the terms of this MOA. Failure by a Party to insist upon the strict performance of any of the provisions of this MOA by any other Party, or the failure by a Party to exercise its rights upon the default of the other Party, shall not constitute a waiver of such Party's right to insist and demand strict compliance by the other Parties with the terms of this MOA. Any amendments or modifications to this MOA must be in writing, signed by duly authorized representatives of each of the Parties hereto. The MOU that was approved by the City pursuant to Resolution No. 2007 -58 is of no force and effect and has been replaced and superseded in its entirety by this MOA. DEFAULT, REMEDIES, AND TERMINATION. 7.1 Notice and Opportunity to Cure. Before this MOA may be terminated or action may be taken to obtain judicial relief, the Party seeking relief ( "Nondefaulting Party ") shall comply with the notice and cure provisions of this Section. A Nondefaulting Party in its 6 42 discretion may elect to declare a default under this Agreement in accordance with the procedures hereinafter set forth for any failure or breach of any other Party ( "Defaulting Party ") to perform any material duty or obligation of said Defaulting Party in accordance with the terms of this MOA. However, the Non - Defaulting Party must provide written notice to the Defaulting Party setting forth the nature of the breach or failure and the actions, if any, required by the Nondefaulting Party to cure such breach or failure. The Defaulting Party shall be deemed in "default" of its obligations set forth in this MOA if the Defaulting Party has failed to take action and cured the default within ten (10) days after the date of such notice (for monetary defaults), within thirty (30) days after the date of such notice (for non - monetary defaults), or within such lesser time as may be specifically provided for in this MOA. If, however, a non - monetary default cannot be cured within such thirty (30) day period, as long as the Defaulting Party does each of the following: (i) notifies the Non - Defaulting Party in writing with a reasonable explanation as to the reasons the asserted default is not curable within the thirty (30) day period and provides a proposed course of action to cure the default; (ii) promptly commences to cure the default within the thirty (30) day period; (iii) makes periodic reports to the Non - Defaulting Party as to the progress of the program of cure; and (iv) diligently prosecutes such cure to completion, then the Defaulting Party shall not be deemed in breach of this MOA. Notwithstanding the foregoing, the Defaulting Party shall be deemed in default of its obligations set forth in this MOA if said breach or failure involves the payment of money but the Defaulting Party has failed to completely cure said monetary default within ten (10) days (or such lesser time as may be specifically provided in this MOA) after the date of such notice. 7.2 Default Remedies. Subject to Section 7.3, in the event of a default, the Non - Defaulting Party, at its option, may institute legal action to cure, correct, or remedy such default, enjoin any threatened or attempted violation, enforce the terms of this MOA by specific performance, or pursue any other legal or equitable remedy. 7.3 New Home's Exclusive Remedy. The Parties acknowledge that City would not have entered into this MOA if it were to be liable in damages under or with respect to this MOA, or the application thereof, or any permit or approval sought by New Home in accordance herewith. Accordingly, New Home covenants, on behalf of itself and its successors and assigns, not to sue City for damages or monetary relief for any breach of this MOA or arising out of or connected with any dispute, controversy or issue regarding the application, interpretation of effect of this MOA, or any land use permit or approval sought in connection with the development or use of the Property or any portion thereof, the Parties agreeing that declaratory and injunctive relief, mandate, and specific performance shall be New Home's sole and exclusive judicial remedies. 7.4 Force Maieure. The obligations by any Party hereunder shall not be deemed to be in default where delays or failures to perform are due to any cause without the fault and beyond the reasonable control of such Party, including to the extent applicable, the following: war; insurrection; strikes; walk -outs; the unavailability or shortage of labor, materials, or equipment; riots; floods; earthquakes; the discovery and resolution of hazardous waste or significant geologic, hydrologic, archaeological, paleontologic, or endangered species problems on the Property; fires; casualties; acts of God; governmental restrictions imposed or mandated by other governmental entities; with regard to delays of New Home's performance, delays caused by City's failure to act or timely perform its obligations set forth herein; with regard to delays of City's performance, delays caused by a New Home's failure to act or timely perform its 7� obligations set forth herein; inability to obtain necessary permits or approvals from other governmental entities; enactment of conflicting state or federal statutes or regulations; judicial decisions; or litigation not commenced by such Party. Notwithstanding the foregoing, any delay caused by the failure of City or any agency, division, or office of City to timely issue a license, permit, or approval required pursuant to this MOA shall not constitute an event of force majeure extending the time for City's performance hereunder. If written notice of such delay or impossibility of performance is provided to the other Parties within a reasonable time after the commencement of such delay or condition of impossibility, an extension of time for such cause will be granted in writing for the period of the enforced delay, or longer as may be mutually agreed upon by the Parties in writing, or the performance rendered impossible may be excused in writing by the Party so notified. In no event shall adverse market or financial conditions constitute an event of force majeure extending the time for such Party's performance hereunder. 8. NOTICES. Any demand upon or notice required or permitted to be given by one party to the other shall be in writing, shall be made in the following manner, and shall be effective (a) upon receipt if given by personal delivery, (b) on the date indicated on the receipt if given by certified or registered mail, return receipt requested, or (c) on the succeeding business day after mailing or deposit if given by Express Mail or by deposit with a private delivery service of general use (e.g., Federal Express), postage or fee paid, as appropriate, addressed to the parties as set forth below. Notice of a change of address shall be given by written notice in the manner set forth in this section. For the purposes of this MOA, all information, requests, or other business including any demand upon a party or notice pursuant hereto shall be coordinated through the following agency representatives: City of Newport Beach Attn: David Kiff, City Manager (with copy to City Attorney's Office) 3300 Newport Blvd. Newport Beach, CA 92658 -8915 The New Home Company Southern California LLC Tom Redwitz, President 95 Enterprise, Suite 325 Aliso Viejo, CA 92656 IN WITNESS WHEREOF, City and New Home have executed this MOA as of the date first written above. [SIGNATURES ON THE FOLLOWING PAGE] so ATTEST: CITY OF NEWPORT BEACH, A Municipal Corporation By: By: Leilani Brown Nancy Gardner City Clerk Mayor 0» tZS]U a1 p7_lkY I 163 1101985 i I By: Aaron Harp City Attorney THE NEW HOME COMPANY SOUTHERN CALIFORNIA LLC, a Delaware Limited Liability Company By: Tom Redwitz President 9 51 52 City Council Attachment C Correspondence Letter from Law Offices of Robert C. Hawkins 53 54 reb 14 2012 4:08PM Via Facsimile Hawkins Law Offices 1949) 850 -1181 p.2 'RECEIVED AFI'ER AGO )( �C iiPSdef�ai'�� fly LAW OFFICES OF ROBERT CREGEII E� Nancy Gardner, Mayor Members of the City Council City of Newport Beach 3300 Newport Blvd. Newport Beach, California 92663 Re: February 14, 2012 'cui2 FEB 14 PM j 24 OF; I"= OF THE C; "CLERK CIS! C.- r -`�?UT BEACH Dear Honorable Mayor and Members of the City Council: Thank you for the opportunity to comment to comment on the captioned matter. This firm represents Friends of Dolores and others in the City in connection with the captioned matter. This matter was approved over six years ago, many Newport Center project ago and one General Plan ago: times have surely changed. The Staff Report advises you that the Project has not changes and that the revised Affordable Housing Implementation Plan and the Memorandum of Agreement do not constitute substantial changes in the Project. However, this cursory analysis fails to note that the request to waive the General Plan's requirement that the applicant enter into a Development Agreement reflects, in part, the need for additional and supplemental environmental analysis. Indeed, both the California Environmental Quality Act, Public Resources Code sections 21000 et seq. and the implementing regulations, the State CEQA Guidelines, 14 CCR § 15000, require that supplemental or subsequent environmental analysis be conducted when: "(b) Substantial changes occur with respectto the circumstances underwhich the project is beingundertaken which will require major revisions in the environmental impact report. [or] (c) New information, which was not known and could not have been known at the time the environmental impact report was certified as complete, becomes available again on the minutes for the captioned meeting. The minutes for the captioned meeting require several corrections." Public Resources Code section 21166. See State CEQA Guidelines section 15162. 110 Newport Center Drive, Su ice 200 Newport Beach, California 92660 (949) 650 -5550 Fax: (949) 650 -1181 1515 Feb 14 2012 4:08PM Hawkins Law Offices (949) 650 -1181 p.3 The Han. Mayor Gardner Members of the City Council - 2 - February 14, 2012 Here, as indicated above, much has changed. First, in 2006, the voters approved the new General Plan which required, among other things, that projects such as the captioned Project in Newport Center enter into development-agreements. Second, many projects have been approved since the captioned Project was first approved and all have entered into development agreements: the Newport Beach Country Club Project; the Golf Realty Project; the Irvine Company's North Newport Center Project; the Hyatt Project; and others. The only project in Newport Center which has not entered into a development agreement is the City Hall Project along Avocado Ave. Third, the environmental analysis for the captioned Project did not consider the cumulative impacts of these new projects together with the captioned Project on any resources including traffic. The environmental analysis for the captioned Project is stale and tired. It failed to consider the cumulative impacts of the Project together with these other projects, many of which were not even in the pipeline. Section 21166 requires supplemental analysis for the Project. Thank you for your anticipated cooperation in this matter. Please provide me with notices regarding the captioned Project. We will provide further and additional comments on the captioned matter in a timely manner. Of course, should you have any questions, please do not hesitate to contact me. Sincerely, OFFICES OF E C. HAWKINS WIobert Vlawl! ins RCHlkw cc: Leilani Brown, City Clerk 110 Newport Center Drive, Suite 200 Newport Beach, California 92660 (949)650.5550 Fax: (949) 650 -1181 S0 City Council Attachment D CEQA Guidelines Section 15162 M �g 15162. SUBSEQUENT EIRS AND NEGATIVE DECLARATIONS (a) When an EIR has been certified or a negative declaration adopted for a project, no subsequent EIR shall be prepared for that project unless the lead agency determines, on the basis of substantial evidence in the light of the whole record, one or more of the following: (1) Substantial changes are proposed in the project which will require major revisions of the previous EIR or negative declaration due to the involvement of new significant environmental effects or a substantial increase in the severity of previously identified significant effects; (2) Substantial changes occur with respect to the circumstances under which the project is undertaken which will require major revisions of the previous EIR or Negative Declaration due to the involvement of new significant environmental effects or a substantial increase in the severity of previously identified significant effects; or (3) New information of substantial importance, which was not known and could not have been known with the exercise of reasonable diligence at the time the previous EIR was certified as complete or the Negative Declaration was adopted, shows any of the following: (A) The project will have one or more significant effects not discussed in the previous EIR or negative declaration; (B) Significant effects previously examined will be substantially more severe than shown in the previous EIR; (C) Mitigation measures or alternatives previously found not to be feasible would in fact be feasible, and would substantially reduce one or more significant effects of the project, but the project proponents decline to adopt the mitigation measure or alternative; or (D) Mitigation measures or alternatives which are considerably different from those analyzed in the previous EIR would substantially reduce one or more significant effects on the environment, but the project proponents decline to adopt the mitigation measure or alternative. (b) If changes to a project or its circumstances occur or new information becomes available after adoption of a negative declaration, the lead agency shall prepare a subsequent EIR if required under subdivision (a). Otherwise the lead agency shall determine whether to prepare a subsequent negative declaration, an addendum, or no further documentation. (c) Once a project has been approved, the lead agency's role in project approval is completed, unless further discretionary approval on that project is required. Information appearing after an approval does not require reopening of that approval. If after the project is approved, any of the conditions described in subdivision (a) occurs, a subsequent EIR or negative declaration shall only be prepared by the public agency which grants the next discretionary approval for the project, if any. In this situation no other responsible agency shall grant an approval for the project until the subsequent EIR has been certified or subsequent negative declaration adopted. (d) A subsequent EIR or subsequent negative declaration shall be given the same notice and public review as required under Section 15087 or Section 15072. A subsequent EIR or negative declaration shall state where the previous document is available and can be reviewed. Note: Authority cited: Section 21083, Public Resources Code; Reference: Section 21166, Public Resources Code; Bowman v. City of Petaluma (1986) 185 Cal.App.3d 1065; Benton v. Board of Supervisors (1991) 226 Cal.App.3d 1467; and Fort Mojave Indian Tribe v. California Department of Health Services et al. (1995) 38 Cal.App.4th 1574. 159 I CITY OF NEWPORT BEACH City Council Staff Report Agenda Item No. February 14, 2012 TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: Community Development Department Kimberly Brandt, AICP, Director 949 - 644 -3226, kbrandt @newportbeachca.gov PREPARED BY: Jaime Murillo, Associate Planner APPROVED: (^ TITLE: Santa Barbara Condominiums: Affordable Housing Implementation Plan and Memorandum of Agreement 900 Newport Center Drive (PA2012 -012) ABSTRACT: An amendment to an Affordable Housing Implementation Plan (AHIP) to allow the payment of in -lieu housing fees to satisfy the affordable housing obligations of the previously approved 79 -unit Santa Barbara Condominium Project located at 900 Newport Center Drive. The request also includes a Memorandum of Agreement (MOA) between the City of Newport Beach and the new applicant, New Home Company Southern Califomia, LLC, specifying the payment of public benefits fees, phasing of development of the property, and waiving a requirement that the parties enter into a development agreement. RECOMMENDATION: Adopt Resolution No. 2012 -_ (Attachment A) approving: An amendment to an Affordable Housing Implementation Plan for the Santa Barbara Condominiums Project (Exhibit 1 of Attachment A), and 2. A Memorandum of Agreement between City of Newport Beach and New Home Company Southern California, LLC (Exhibit 2 of Attachment A); and 3. A waiver of a requirement for a development agreement; and 4. Rescindment of Resolution No. 2007 -058. 1 900 Newport Center Drive (PA2012 -012) February 14, 2012 Page 2 FUNDING REQUIREMENTS: There is no fiscal impact related to this item. However, approval would lead to the future payment of in -lieu housing fees (approx. $1.6 million) to be paid into the Affordable Housing Fund and payment of a Public Benefits Fee ($5 million) to be paid into the General Fund. BACKGROUND: AHIP Background On January 10, 2006, the City Council approved Resolution No. 2006 -2 permitting the development of 79 condominiums on a 4.25- acre -site that is presently developed with an outdoor tennis complex operated by the Newport Beach Marriot Hotel located at 900 Newport Center Drive (Attachment B- Vicinity Map). The Resolution included the following condition with regard to affordable housing: Condition No. 5: The applicant shall provide a minimum of 20% of the total units (16 units) for affordable income households in accordance with Housing Programs 2.2.1 and 2.2.3 of the Newport Beach Housing Element. The applicant shall enter into an agreement with the City to provide said units, which units may be provided off -site, at an approved location within the City. These units shall be identified in the agreement and constructed and completed prior to the issuance of any certificate of occupancy for the project. The agreement shall be reviewed and approved by the City Attorney and shall be executed and recorded prior to the recordation of the final tract map or the issuance of a building or grading permit for the proposed subdivision. Subsequent to the approval of the Santa Barbara Condominiums project (during which time the applicant was seeking California Coastal Commission approvals), the City adopted a new Housing Element as part of the General Plan update in 2006. Because of the opportunities for housing development that were added to the Land Use Element, the Housing Element was changed to set a goal of 15% of all new units to be affordable, and to require that an AHIP be prepared for projects with more than 50 units. As a result of the change in the affordable housing goal, the applicant prepared an AHIP (Exhibit 1 of Attachment C) that was in compliance with City's new housing goal and met the intent of Condition No. 5 of the project approval. The AHIP included the purchase and recordation of covenants that would restrict the occupancy of an existing, market -rate, 12 -unit apartment complex to qualifying moderate - income households. The AHIP was approved by the City Council on August 14, 2007, per Resolution No. 2007 -058 (Attachment C). Memorandum of Understanding (MOU) Background In addition to amending the Housing Element during the time that the Santa Barbara project was before the Coastal Commission, the City Council adopted an amendment to 2 900 Newport Center Drive (PA2012 -012) February 14, 2012 Page 3 the Municipal Code regarding development agreements as one of the many means of implementing the updated General Plan. Development agreements are now required for projects that require a legislative act (i.e. General Plan amendment, Coastal Land Use Plan amendment, or Zoning ordinance change) and include more than 50 residential units. Although local approvals were completed prior to this policy being implemented, the project met this requirement as a result of the Coastal Commission approval of the project that required the City to amend the Coastal Land Use Plan (CLUP). The CLUP amendment added CLUP Policy 2.3.1 -8 requiring that a five million dollar mitigation fee be paid to the Coastal Commission. As a result, a Memorandum of Understanding (MOU) was prepared between the City and Lennar Homes (previous applicant) establishing an agreement (Exhibit 2 of Attachment C) that a development agreement would be prepared expeditiously and outlines the provisions to be included in the development agreement. Those provisions included: 1. Payment of a five million dollar ($5,000,000) Public Benefits Fee to the City. This amount is in addition to the five million dollar mitigation fee imposed by the Coastal Commission. 2. Expedited review the Affordable Housing Agreement to implement the AHIP, and expedited review of development plans for the project; and 3. City development approvals will be vested for five years. The MOU was also adopted by the City Council on August 14, 2007, per Resolution No. 2007 -058 (Attachment C). Discussion on the use of the Public Benefits Fee was continued to the September 11, 2007, City Council agenda, at which time the City Council voted to postpone a decision regarding allocation of the funds until after the approval of the development agreement (Attachment D). To this date, a development agreement has not been prepared. DISCUSSION: Amendment to AHIP The original applicant, Lennar Homes, no longer controls the project and New Home Company Southern California, LLC (New Home) is under contract to purchase the property and develop the project. New Home states that negotiations with the owner of the 12 -unit apartment complex to purchase and record affordability covenants failed. New Home believes that it is not possible to implement the AHIP as previously structured. Therefore, New Home is proposing a revised AHIP (Exhibit 1 of Attachment A) that would allow for the payment of in -lieu housing fees. Payment of in -lieu housing fees for projects of more than 50 units is permissible subject to the approval of an AHIP pursuant to Municipal Code Chapter 19.54 (Inclusionary Housing). The in -lieu housing fee is currently $20,544 per unit and increases annually based on the percentage 3 900 Newport Center Drive (PA2012 -012) February 14, 2012 Page 4 change in new home prices for Orange County. The in -lieu housing fee will be paid at the rate in effect upon the issuance of each building permit for each unit within the project. Pursuant to Section 19.54.070.D of the Municipal Code, the City Council may approve or conditionally approve an AHIP that proposes alternative means of compliance with on -site construction requirements of the Chapter after first making the following findings: 1. The purpose of the chapter would be served by the implementation of the proposed alternative; 2. The units provided are located within the City and are consistent with the requirements of this chapter; and 3. It would not be feasible or practical to construct the units on -site. Acceptance of in -lieu housing fees will shift the responsibly of providing the units to the City. The City would be required to utilize the fees to construct, convert or preserve affordable housing units within the City. However, acceptance of the fees would permit the City to exercise its discretion to direct the funding of affordable units in the City in a manner consistent with the requirements of Chapter 19.54 of the Municipal Code and more effectively accomplish the goals and objectives set forth in the Housing Element, and support the required findings as follows: The City could partner with an affordable housing developer and leverage the in- lieu housing funds with other sources to construct or convert units for a deeper affordability level (i.e. lower- income households) in the City. Through this scenario, the City may also receive credit under the City's Regional Housing Needs Allocation (RHNA), whereas the units provided under the original AHIP would not be eligible as they were only moderate - income units and not lower - income. The City's Affordable Housing Fund currently has a balance of $1.5 million, which is an amount that has been insufficient to assist in the development of any sizable affordable housing projects proposed to the City. The proposed AHIP could generate an additional $1.2 million in the Affordable Housing Fund, creating a larger fund that would be awarded to an affordable housing developer and increase a project's feasibility within the City. When the project was originally approved, it was determined that providing the required affordable units on -site would not be feasible or practical given the size, scope, design, site configuration, and location of the proposed project. 21 900 Newport Center Drive (PA2012 -012) February 14, 2012 Page 5 Memorandum of Agreement (MCA) The proposed MOA (Exhibit 2 of Attachment A) establishes the City's and the applicant's agreement to: 1) amend the previously approved AHIP; 2) replace and supersede the prior MOU; and 3) waive the requirements of a development agreement. In exchange, the applicant will provide the following Public Benefits Fee: Public Benefits Fee- The applicant shall pay to the City a Public Benefits Fee of $63,291 per unit ($5,000,000 total) which shall be used by the City to fund projects for the benefit of the public. The fee would be deposited into the General Fund with no other restrictions on use. The fee shall be paid upon the issuance of each certificate of occupancy for each unit. The MCA also authorizes the City to issue separate permits for each building and phase of the project, and authorizes the establishment of a temporary sales trailer. The term of the MOA is for a period of ten years from the date the applicant assumes fee title ownership of the property. The MOA also includes provisions for payment of in -lieu park fees, as required per the Municipal Code. Waiver of Development Agreement Pursuant to Section 15.45.020.0 of the Municipal Code, the City Council may waive the requirement for a development agreement, if it finds that the legislative act is of a minor nature, the project provides significant public benefits to the City, or the nature of the project is such that neither the City nor the developer would benefit from a development agreement. As discussed above, the applicant has agreed to provide the City with a $5 million Public Benefits Fee, which may be used by the City for any projects that benefit the City, in addition to the housing and park fees. Also, since the applicant is not seeking vesting of development rights, the City nor the applicant would benefit from a development agreement. ENVIRONMENTAL REVIEW: A Mitigated Negative Declaration (SCH No. No. 2005 - 071067) was prepared for the proposed project in accordance with the implementing guidelines of the California Environmental Quality Act (CEQA). The document was made available for public review and comment during a 30 -day review period from July 15 to August 15, 2005 and subsequently approved by the City Council on January 10, 2006. The document is on file with the Community Development Department. A subsequent mitigated negative declaration for the project is not required to be prepared pursuant to CEQA Guidelines Section 15162 because the amended AHIP and MOA do not constitute "substantial changes" to the project that would involve new significant environmental effects or result in additional mitigation measures. J 900 Newport Center Drive (PA2012 -012) February 14, 2012 Page 6 NOTICING: The agenda item has been noticed according to the Brown Act (72 hours in advance of the meeting at which the City Council considers the item). Notice of this agenda item was also published in the Daily Pilot, mailed to property owners within 300 feet of the property and posted at the site a minimum of 10 days in advance of the meeting. Additionally, the item appeared upon the agenda for this meeting, which was posted at City Hall and on the City website. Submitted by: Kimberly Brand t, P Director PO Attachments: A. City Council Resolution including proposed AHIP and MCA B. Project Vicinity Map C. City Council Resolution No. 2007 -058 including previous AHIP and MOU D. September 11, 2007 City Council Minutes N City Council Attachment A City Council Resolution including proposed AHIP and MOA 7 2 RESOLUTION NO. 2012- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH APPROVING AN AFFORDABLE HOUSING IMPLEMENTATION PLAN AND MEMORANDUM OF AGREEMENT, AND WAIVING THE REQUIREMENT OF A DEVELOPMENT AGREEMENT FOR THE SANTA BARBARA CONDOMINIMUM PROJECT AT 900 NEWPORT CENTER DRIVE (PA2012 -012) THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH HEREBY FINDS AS FOLLOWS: SECTION 1: STATEMENT OF FACTS 1. On January 10, 2006, the City Council adopted Resolution No. 2006 -2, approving an application by Lennar Homes for the development of 79 condominium units at 900 Newport Center Drive. 2. Resolution No. 2006 -2 includes Condition No. 5, which establishes the requirements for the project to meet the affordable housing requirements in the City's Housing Element. 3. On July 25, 2006, the City Council approved a comprehensive update to the General Plan, including changes in affordable housing requirements under an updated Housing Element. 4. On March 27, 2007, the City Council adopted Ordinance No. 2007 -6, amending provisions under which development agreements shall be required for residential projects to implement new policies and land use changes in the General Plan. 5. On August 14, 2007, the City Council adopted Resolution No. 2007 -058, approving an Affordable Housing Implementation Plan (AHIP) that complied with the requirements of the updated Housing Element as satisfaction of Condition No. 5. The resolution also approved a Memorandum of Understanding (MOU) establishing an agreement between the City and Lennar Homes that a development agreement would be prepared vesting rights to develop the project as approved and establishing a public benefit contribution to the City in the amount of $5 million. 6. On May 11, 2010, the City Council adopted Ordinance No. 2010 -9, adding Chapter 19.54 (Inclusionary Housing) to the Municipal Code implementing Housing Program 2.2.1 of the Housing Element. The Chapter allows alternatives to on -site construction of affordable housing, including the I payment of in -lieu housing fees for projects of more than 50 units subject to the approval of an AHIP. 7. Lennar Homes is no longer associated with the project and New Home Company Southern California, LLC ( "New Home Company "), has requested approval of an amendment to the AHIP that complies with the requirements of the updated Housing Element, complies with the requirements of Chapter 19.54 of the Municipal Code, and satisfies Condition No. 5 of the project approval. 8. New Home Company wishes to enter into a Memorandum of Agreement (MOA) with the City to replace and supersede the previous MOU and to specify the payment of public benefit fees, phasing of development of the property, and waiving a requirement for a development agreement. SECTION 2. CALIFONIA ENVIRONMNETAL QUALITY ACT DETERMINATION A Mitigated Negative Declaration (SCH No. No. 2005 - 071067) has been prepared for the proposed project in accordance with the implementing guidelines of the California Environmental Quality Act (CEQA). The document was made available for public review and comment during a 30 -day review period from July 15 to August 15, 2005 and subsequently approved by the City Council on January 10, 2006. A subsequent mitigated negative declaration for the project is not required to be prepared pursuant to CEQA Guidelines Section 15162 because the amended AHIP and MOA do not constitute "substantial changes" to the project that would involve new significant environmental effects or result in additional mitigation measures. SECTION 3. REQUIRED FINDINGS 1. Pursuant to Section 19.54.050.A.2 of the Municipal Code, the payment of in- lieu housing fees for residential subdivisions of more than 50 units requires the approval of an AHIP. In accordance with Section 19.54.070.D of the Municipal Code, the following findings and facts in support of such findings for alternatives to on -site construction are set forth: Finding: A. The purpose of the chapter would be served by the implementation of the proposed alternative. Facts in Support of Finding: A -1 The acceptance of the fees would permit the City to exercise its discretion to direct the funding of affordable units in the City in a manner consistent with the requirements of Chapter 19.54 of the Municipal 10 Code and more effectively accomplish the goals and objectives set forth in the Housing Element. A -2 Through the acceptance of in -lieu housing fees, the City could partner with an affordable housing developer to leverage the in -lieu fees with other sources to construct or convert units for a deeper affordability level (i.e. lower- income households) in the City. A -3 Utilizing the in -lieu fees to construct, convert, or preserve affordable housing units in the City may assist in obtaining credit under the City's Regional Housing Needs Allocation (RHNA), whereas the units provided under the original AHIP would not be eligible and would not address lower- income housing needs. A -4 The City's Affordable Housing Fund currently consists of approximately $1.5 million, which is an amount that has been insufficient to assist in the development of any sizable affordable housing projects. The proposed AHIP could generate an additional $1.2 million in the Affordable Housing Fund, creating a larger fund that would be awarded to an affordable housing developer and increase a project's feasibility within the City. Finding: B. The units provided are located within the City and are consistent with the requirements of this chapter [Chapter 19.54]. Facts in Support of Finding: B -1 The in -lieu housing fees would be deposited into the City's Affordable Housing Fund, which shall be used in compliance with the General Plan Housing Element to construct, rehabilitate, or subsidize affordable housing or assist other government entities, private organizations, or individuals to provide or preserve affordable housing within the City. Finding: C. It would not be feasible or practical to construct the units on -site. Facts in Support of Finding: C -1 When the project was originally approved, it was determined that providing the required affordable units on -site would not be feasible or practical given the size, scope, design, site configuration, and location of the proposed project. 11 2. Pursuant to Section 15.45.020.0 of the Municipal Code, the City Council may waive the requirement for a development agreement. The following findings and facts in support of such findings for the waiver of a development agreement are set forth: Finding: A. The legislative act is of a minor nature, or the project provides significant public benefits to the City, or the nature of the project is such that neither the City nor the developer would benefit from a development agreement. Facts in Support of Finding: A -1 The applicant has agreed to enter into a Memorandum of Agreement (MOA) that includes the payment of a $5 million Public Benefits Fee to the City, which may be used by the City for any projects that benefit the City, in addition to the housing and park fees. A -2 Since the applicant is not seeking vesting of development rights, the City nor the applicant would benefit from a development agreement. SECTION 4. DECISION NOW, THEREFORE, BE IT RESOLVED 1. The City Council of the City of Newport Beach does hereby approve an amended Affordable Housing Implementation Plan for the Santa Barbara Condominiums Project, attached as Exhibit 1. 2. The City Council of the City of Newport Beach does hereby approve a Memorandum of Agreement between New Home Company and City of Newport Beach, attached as Exhibit 2. 3. The City Council of the City of Newport Beach does hereby waive the requirement for a development agreement. 4. Resolution No. 2007 -058 is hereby rescinded. 5. This resolution shall take effect immediately upon adoption. 6. This resolution was approved, passed and adopted at a regular meeting of the City Council of the City of Newport Beach held on February 14, 2012, by the following vote, to wit: 12 AYES, COUNCIL MEMBERS NOES, COUNCIL MEMBERS ABSENT COUNCIL MEMBERS MAYOR ATTEST: 1yr111019yIIIIIA:IN 13 14 Exhibit 1 Amended Affordable Housing Implementation Plan 15 10 The New Home Company Santa Barbara Condominiums Affordable Housing Implementation Plan City of Newport Beach, CA January 30, 2012 17 TABLE OF CONTENTS I. Executive Summary Page i- m New Home Company — Santa Barbara Condominiums Affordable Housing Implementation Plan I. Executive Summary Back round In January, 2006, the City of Newport Beach approved General Plan Amendment No. 2004 -005, Local Coastal Program Land Use Plan Amendment No. 2005 -001, Tentative Parcel Map No. 2005 -014, Tentative Tract Map No. 2004 -004 (TTM 16774), Traffic Study No. 2005- 002 and Coastal Residential Development Permit No. 2005 -004 and adopted Ordinance No. 2006 -1 approving Planned Community Development No. 2005 -003 amending Zoning District Map No. (48) to permit the development of 79 residential units on approximately 4.26 acres of land at 900 Newport Center Drive, known as the Santa Barbara Condominium Project (the "Project "). Condition 5 of the City Council Resolution 2006 -2 approving the project establishes the affordable housing requirement for the project, as follows: The applicant shall provide a minimum of 20% of the total units (16 units) for affordable income households in accordance with Housing Programs 2.2.1 and 2.2.3 of the Newport Beach Housing Element. The applicant shall enter into an agreement with the City to provide said units, which units may be provided off -site, at an approved location within the City. These units shall be identified in the agreement and constructed and completed prior to the issuance of any certificate of occupancy for the project. The agreement shall be reviewed and approved by the City Attorney and shall be executed and recorded prior to the recordation of the final tract map or the issuance of a building or grading permit for the proposed subdivision. The City of Newport Beach's Housing Element as approved by the City Council in July, 2006, after approval of the Project, includes an amended Housing Program 2.2.1, which sets the goal that 15% of all new housing units in the city be affordable to very low -, low- and moderate - income households. Pursuant to Section 19.54.060 of the Newport Beach Municipal Code, projects with more than 50 units are required to prepare an Affordable Housing Implementation Plan ( "AHIP ") that specifies how the development will meet the City's affordable housing goal. On May 11, 2010, the City Council adopted Ordinance No. 2010 -9 adding a new chapter to the Subdivision Code implementing Housing Program 2.2.1 of the Housing Element of the City's General Plan which allows for alternatives to on -site construction of affordable housing units, including payment of in -lieu fees for projects of fifty-one (5 1) dwelling units or more with approval of an AHIP. Summary On August 14, 2007, the City Council of the City of Newport Beach adopted Resolution 2007 -58 approving an Affordable Housing Implementation Plan for the Project (the "2007 AHIP ") as proposed by then - applicant Lennar Homes. Subsequent to approval of the 2007 AHIP, The New Home Company has entered into an agreement with the landowner of the 4.26 acre site to acquire the site and develop the Project. 19 New Home Company — Santa Barbara Condominiums Affordable Housing Implementation Plan In reviewing the provisions of the 2007 AHIP and as a result of further discussions on how the City would like to implement its inclusionary housing ordinance, the City and The New Home Company have agreed that the 2007 AHIP should be amended. The New Home Company has proposed this new 2012 Affordable Housing Implementation Plan ( "2012 AHIP ") in order to address the City's objectives and to satisfy the provisions of the City's current Inclusionary Housing requirements as set forth in Chapter 19.54 of the Newport Beach Municipal Code and the Newport Beach Housing Element. Accordingly, The New Home Company, after extensive research on options for meeting the affordable housing requirements, and in consideration of the Chapter 19.54 of the Newport Beach Municipal Code and the adopted Housing Element requirement for 15% of all new units to be affordable, agrees to meet the requirements of the City Inclusionary Housing requirements and the Housing Element as described below. II. Affordable Housing Implementation Payment of In -Lieu Fees In accordance with the provisions of Section 19.54.050 of the Newport Beach Municipal Code, The New Home Company shall pay a fee in -lieu of constructing the affordable housing units required for the Project (the "In -lieu Fee "). The In -lieu Fee shall be paid at the rate in effect at the time of the issuance of each Building Permit, as that term is defined in the Memorandum of Agreement between the City and The New Home Company, for each market rate unit. ME Exhibit 2 Memorandum of Agreement 21 22 MEMORANDUM OF AGREEMENT BETWEEN THE NEW HOME COMPANY AND CITY OF NEWPORT BEACH This Memorandum of Agreement ( "MOA ") is entered into by and between The New Home Company Southern California LLC, a Delaware limited liability company ( "New Home "), and the City of Newport Beach ( "City "), a municipal corporation through its duly elected, appointed, qualified or acting representatives as of the _ day of February, 2012. City and New Home are sometimes collectively referred to in this MOA as the "Parties" and individually as a "Party." RECITALS A. WHEREAS, on January 10; 2006 the Newport Beach City Council approved Resolution No. 2006 -2 adopting Mitigated Negative Declaration (SCH No. 2005 - .071067) and approved General Plan Amendment No. 2004 -005, Local Coastal Program Land Use Plan Amendment No. 2005 -001, Tentative Parcel Map No. 2005 -014, Tentative Tract Map No. 2004- 004 ( "TTM 16774 "), Traffic Study No. 2005 -002 and Coastal Residential Development Permit No. 2005 -004 and adopted Ordinance No. 2006 -1 approving Planned Community Development No. 2005 -003 amending Zoning District Map No. (48) for property located at 900 Newport Center Drive ( "PA 2004 -169 ") to permit the development of 79 residential units on approximately 4.26 acres of land ( "Property ") described in Exhibit "A "; B. WHEREAS, on March 27, 2007, the City Council adopted Ordinance No. 2007- 6, amending provisions under which development agreements shall be required for residential development projects in the City to implement new policies and Land Use changes in the new General Plan and requiring development agreements for projects that require a legislative act and include more than 50 units; and C. WHEREAS, on July 10, 2007 the California Coastal Commission approved City of Newport Beach Land Use Plan Amendment NPB- MAJ -1 -06 Part A (Marriott Hotel VSC to MDR/Santa Barbara Condominiums) subject to modifications; D. WHEREAS, on July 24, 2007, the City Council approved Resolution No. 2007- 56 accepting the modifications suggested by the California Coastal Commission; E. WHEREAS', on July 24, 2077, the City Council approved Resolution No. 2007- 55 approving an Affordable Housing Implementation Plan and Memorandum of Understanding for the Santa Barbara Condominium Project at 900 Newport Center Drive (PA2004 -169) with Letunar Homes of California, Inc. ( "Lemnar Homes "); F. WHEREAS, on August 14, 2007, the City Council approved Resolution No. 2007 -58, which rescinded Resolution No. 2007 -55 and approved an Affordable Housing Implementation Plan ( "AHIP ") and Memorandum of Understanding ( "MOU ") for the Santa Barbara Condominium Project at 900 Newport Center Drive (PA2004 -169) with Lennar Homes; 23 G. WHEREAS, on September 5, 2007, the California Coastal Commission approved Coastal Development Permit No. 5 -07 -085 permitting the development of 79 residential townhonne units ( "Project ") consistent with the City of Newport Beach Land Use Plan Amendment NPB- MAR -1 -06 Part A; H. WHEREAS, Lennar Homes no longer has an equitable or legal interest in the Properly; 1. WHEREAS, New Home is under contract to acquire the Properly and desires to develop the Project; J. WHEREAS, subsequent to the adoption of Resolution No. 2007 -58, the City adopted Municipal Code Chapter 19.54 to implement the City's inclusionary housing policies; and K. WHEREAS, the Parties have determined that as a result of changed circumstances, the Parties shall amend the prior- approved AHIP, and amend, replace and supercede the prior MOU to set forth the process by which New Home shall satisfy its Quimby Act requirements in accordance with the Subdivision Map Act (Government Code Section 66477), and provide for funding of other public benefits as may be determined by the City Council pursuant to the terms of this MOA. NOW, THERE FORE, in light of the foregoing Recitals, which are incorporated herein by this reference, and for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and in consideration of the representations, assurances, covenants and promises contained herein, the Parties agree as follows: The following terns when used in this MOA shall have the meanings set forth below: 1.1 The tern "AHIP" shall mean the Affordable Housing Implementation Plan approved by City on July 24, 2007, as amended by this MOA, and which is attached as Exhibit «B» 1.2 The term "MOA" shall mean this Memorandum of Agreement. 1.3 The term `Building Permit" shall mean either a combination pennit or any electrical, mechanical, fire, plumbing and /or pool permit that is issued by the City to New Home for any residential building on any portion of the Property. 1.4 The tern "City" shall mean the City of Newport Beach, a California Municipal Corporation and charter city. 1.5 The term "City Council" shall mean the governing body of City. 1.6 The term "Construction Codes" shall mean the Codes that are in effect at the time applicable permits are issued, including but not limited to: California Building Codes Volumes 1 and 2, including Appendix P, I, Appendix Al of Part 10, and all national codes and standards 24 referenced therein, based on the 2010 International Building Code; as published by the International Code Council; the California Electrical Code based on the. National Electrical Code, including Annex A, B and C as published by the National Fire Protection Association; the California Plumbing Code, including Appendix Chapters A, B, D, E, F and G, based on the Uniform Plumbing Code as published by the International Association of Plumbing and Mechanical Officials; the California Mechanical Code, based on the Uniform Mechanical Code, including Appendix A as published by the International Association of Plumbing and Mechanical Officials; the "Uniform Swimming Pool, Spa, and Hot Tub Code" as published by the International Association of Plumbing and Mechanical Officials; the International Property Maintenance Code; the Newport, Beach Administrative Code; the California Fire Code; and International Fire Code, as the same maybe modified and amended by official action. 1.7 The term "Demolition Permit' shall mean a permit that is issued by the City enabling New Home to demolish all existing structures and improvements located on the Property. 1.8 The terns "Development' or "development" shall mean the improvement of the Property for purposes of completing and effecting the structures, improvements, and facilities comprising the Project, including, without limitation, grading, the construction of infrastructure and public facilities related to the Project whether located within or outside the Property, the construction of structures and buildings and the installation of landscaping. Development also includes the maintenance, repair, or reconstruction of any building, structure, improvement, landscaping or facility after the construction and completion thereof. 1.9 The term "Effective Date" shall mean the date that New Home assumes fee title ownership of the Property. 1.10 The term "Foundation Permit" shall mean the permit that is issued to allow construction of the concrete structure that will serve as the foundation for the buildings to be constructed as the Project following all demolition, clearing and grading work required on the Property. 1.11 The term "General Plan' shall mean the City of Newport Beach General Plan, as the General Plan exists as of the Effective Date of this Agreement. 1.12 The term "Rough Grading Permit' shall mean the permit that is issued by the City enabling New Home to accomplish the rough grading of the Property. 1.13 The term "Precise Grading Permit" shall mean the permit that is issued by the City enabling New Home to accomplish the precise grading of the Property, together with the installation of any requisite infrastructure to be located on the Property 1.14 The term "Master Site Plan' shall mean the Master Site Plan for the development of the Property attached hereto as Exhibit "C ". 1.15 The tern "Municipal Code" shall refer to the City of Newport Beach Municipal Code, as the same now exists or may be further amended fion time to time consistent with this Agreement. 3 25 1.16 The tern "Other Permits" shall mean either the Rough Grading Permit or Demolition Permit. 1.17 The term "Project" shall mean the development of the Property pursuant to the conceptual plan for development of the Project on the Property is depicted on the conceptual Master Site Plan attached hereto as Exhibit "C ". 1.18 The term "Residential Permit" shall mean either the Precise Grading Permit, Foundation Permit or the Building Permit. 2. TERM. 2.1 The term of this MOA shall commence on the Effective Date and shall continue thereafter for a period of ten (10) years, unless this MOA is terminated, modified, or extended by circumstances set forth in this MOA or by mutual written consent of the Parties. None of the obligations of New Home as set forth in Sections 3.1 through and inclusive of 3.3, below, with respect to the provision of Public Benefits, and the obligations of City with respect to development of the Property as set forth in Section 4., below, shall arise until after New Home assumes title to the Property. 2.2 Notwithstanding the foregoing Section, the provisions of this MOA shall terminate sixty (60) days after the date upon which the certificate of occupancy for the final residential condominium unit authorized for the project. 2.3 This MOA shall be terminated in the event New Home does not assume title to the Property. New Home shall notify the City within fourteen (14) days of the termination of its contract to acquire the property. 3. PUBLIC BENEFITS. 3.1 AHIP and Affordable Housing Fee. The AHIP, attached as Exhibit "B' provides for the payment of affordable housing fees at the rate in effect at the time the fees are paid pursuant to the schedule set forth in this MOA consistent with NBMC 19.54. The payment t of the Affordable Housing In -Lieu Fee replaces the prior AHIP requirement to purchase covenants to guarantee the affordability of an existing 12- unit apartment building. The Affordable Housing In -Lieu Fee shall be paid at the rate in effect upon the issuance of each Building Permit for each unit. As New Home and the City agree that New Home's affordable housing obligations pursuant to Chapter 19.54 of the Municipal Code shall be satisfied by the payment of in -lieu fees, the parties further agree that the requirements of Section 19.54.080 of the City Municipal Code have been addressed and are satisfied. MM 3.2 Quimby Act Fee. The Proposed Project shall pay in -lieu park fees which shall satisfy its obligations under the Quimby Act, Government Code Section 66477. The Quimby Act fee shall be paid on a pro rata basis at the rate in effect upon the issuance of each Building Permit for each unit. 3.3 Public Benefits Fee. The Project shall pay to the City a Public Benefits Fee of $63,291 per unit, for a total of $5,000,000, which shall be used by the City to fluid projects for the benefit of the public. The Public Benefits Fee shall be paid on it pro -rata basis upon the issuance of each certificate of occupancy for each unit. 3.4 Conformity with Ordinance No. 2007 -6 and Waiver of Development Agreement. In light of the public benefits that shall be provided to the City pursuant to this MOA, and the Proposed Project's commitment to implement new policies and land use changes in the General Plan, and the Proposed Project's provision of those public benefits identified by the City to support implementation of the General Plan as set forth in this MOA, pursuant to Municipal Code Section 15.45.020 (CI), the City hereby waives the requirement that the Parties enter into a development agreement. 4. DEVELOPMENT OF THE PROPERTY. 4.1 Separate Permits, New Home may request and, upon approval of the plans therefor and payment of the appropriate fees, City shall issue separate permits, as follows:(a) the Demolition Permit, (b) the Rough Grading Permit (collectively, "Other Permits "), (c) Precise Grading Permit, (d) the Foundation Permit, and (e) the Building Permit (collectively, "Residential Permit "). The City, upon application from New Home, agrees to issue the Other Permits prior to recordation of any required final subdivision map or condominium plan for the Project. 4.2 Phases/Buildings. City shall apply the regulations then in effect to allow the development of the Project in two (2) separate and distinct phases as shown on the Master Site Plan depicted on Exhibit "C" attached hereto. In addition, for all purposes applicable thereto under the Construction Codes and the applicable Building Codes building and land use regulations, the five (5) Buildings shown on Exhibit "C" shall each be considered a separate Building, although all or some of such Buildings shall share a common garage on a subterranean level. 4.3 Sales Trailer. Upon approval of the site plan therefor and payment of the appropriate fees, City shall allow and issue appropriate permits for the installation and use of a mobile trailer as a temporary sales trailer for the Project on the Phase II area of the Property. 5. ASSIGNMENT. New Home shall have the right to assign its rights and obligations under. this MOA in connection with a transfer of New Home's interest in the Property provided that no partial transfer shall violate the Subdivision Map Act (California Govenunent Code Sections 66410- 27 66499.58). In the event of any such assignment, the assignee shall be liable for the performance of all obligations of New Home with respect to the portion of the Property so transferred. Following an assignment or transfer of any of the rights and interest of New Home set forth in this MCA in accordance with this Section, the assignee's exercise, use and enjoyment of the Property shall be subject to the terms of this MCA to the same extent as if the assignee or transferee were New Home. MISCELLANEOUS PROVISIONS. 6.1 Covenants. The provisions of this MOA shall constitute covenants which shall run with the land comprising the Property for the benefit thereof, and the burdens and benefits hereof shall bind and inure to the benefit of each of the Parties hereto and all successors in interest to the Parties hereto. 6.2 Severability. If any term, provision, covenant, or condition of this MOA is held by a court of competent jurisdiction to be invalid, void, or unenforceable, the remaining provisions of this MOA shall continue in full force and effect, unless and to the extent the rights and obligations of any Party has been materially altered or abridged by such holding. 6.3 Counterparts. This MCA may be executed in counterparts, each of which sliall be considered a duplicate original. 6.4 Governing Law. This MOA shall be governed by, and construed and enforced in accordance with, the laws of the State of California. 6.5 Entire Agreement; Waivers and Amendments. This MCA constitutes the entire understanding and agreement of the Parties and supersedes all previous negotiations, discussions, and agreements among the Parties with respect to all or part of the subject matter hereof No parole evidence of any prior or other agreement shall be permitted to contradict or vary the terms of this MOA. Failure by a Party to insist upon the strict performance of any of the provisions of this MOA by any other Party, or the failure by a Party to exercise its rights upon the default of the other Party, shall not constitute a waiver of such Party's right to insist and demand strict compliance by the other Parties with the terms of this MOA. Any amendments or modifications to this MCA must be in writing, signed by duly authorized representatives of each of the Parties hereto. The MOU that was approved by the City pursuant to Resolution No. 2007 -58 is of no force and effect and has been replaced and superseded in its entirety by this MCA. DEFAULT, REMEDIES, AND TERMINATION. 7.1 Notice and Opportunity to Cure. Before this MOA may be terminated or action may be taken to obtain judicial relief, the Party seeking relief ( "Nondefaulting Party ") shall comply with the notice and cure provisions of this Section. A Nondefaulting Party in its discretion may elect to declare a default under this Agreement in accordance with the procedures hereinafter set forth for any failure or breach of any other Party ( "Defaulting Party ") to perform any material duty or obligation of said Defaulting Party in accordance with the terms of this MOA. However, the Non - Defaulting Party must provide written notice to the Defaulting Party 22 setting forth the nature of the breach or failure and the actions, if any, required by the Nondefaulting Party to cure such breach or failure. The Defaulting Party shall be deemed in "default" of its obligations set forth in this MOA if the Defaulting Party has failed to take action and cured the default within ten (10) days after the date of such notice (for monetary defaults), within thirty (30) days after the date of such notice (for non - monetary defaults), or within such lesser time as may be specifically provided for in this MOA. If, however, a non- monetary default cannot be cured within such thirty (30) day period, as long as the Defaulting Party does each of the following: (i) notifies the Non - Defaulting Party in writing with a reasonable explanation as to the reasons the asserted default is not curable within the thirty (30) day period and provides a proposed course of action to cure the default; (ii) promptly commences to cure the default within the thirty (30) day period; (iii) makes periodic reports to the Non - Defaulting Party as to the progress of the program of cure; and (iv) diligently prosecutes such cure to completion, then the Defaulting Party shall not be deemed in breach of this MOA. Notwithstanding the foregoing, the Defaulting Party shall be deemed in default of its obligations set forth in this MOA if said breach or failure involves the payment of money but the Defaulting Party has failed to completely cure said monetary default within ten (10) days (or such lesser time as may be specifically provided in this MOA) after the date of such notice. 7.2 Default Remedies. Subject to Section 7.3, in the event of a default, the Non - Defaulting Party, at its option, may institute legal action to cure, correct, or remedy such default, enjoin any threatened or attempted violation, enforce the terms of this MOA by specific performance, or pursue any other legal or equitable remedy. 7.3 New Home's Exclusive Remedy: The Parties acknowledge that City would not have entered into this MOA if it were to be liable in damages under or with respect to this MOA, or the application thereof, or any permit or approval sought by New Home in accordance herewith. Accordingly, New Home covenants, on behalf of itself and its successors and assigns, not to sue City for damages or monetary relief for any breach of this MOA or arising out of or connected with any dispute, controversy or issue regarding the application, interpretation of effect of this MOA, or any land use permit or approval sought in connection with the development or use of the Property or any portion thereof, the Parties agreeing that declaratory and injunctive relief, mandate, and specific performance shall be New Home's sole and exclusive judicial remedies. 7.4 Force Majeure. The obligations by any Party hereunder shall not be deemed to be in default where delays or failures to perform are due to any cause without the fault and beyond the reasonable control of such Party, including to the extent applicable, the following: war; insurrection; strikes; walk- outs; the unavailability or shortage of labor, materials, or equipment; riots; floods; earthquakes; the discovery and resolution of hazardous waste or significant geologic, hydrologic, archaeological, paleontologic, or endangered species problems on the Property; fires; casualties; acts of God; governmental restrictions imposed or mandated by other governmental entities; with regard to delays of New Home's performance, delays caused by City's failure to act or timely perform its obligations set forth herein; with regard to delays of City's performance, delays caused by a New Home's failure to act or timely perform its obligations set forth herein; inability to obtain necessary permits or approvals from other governmental entities; enactment of conflicting state or federal statutes or regulations; judicial decisions; or litigation not commenced by such Party. Notwithstanding the foregoing, any delay caused by the failure of City or any agency, division, or office of City to titnely issue a license, 29 permit, or approval required pursuant to this MOA shall not constitute an event of force majeure extending the time for City's performance hereunder. If written notice of such delay or impossibility of performance is provided to the other Parties within a reasonable time after the commencement of such delay or condition of impossibility, an extension of time for such cause will be granted in writing for the period of the enforced delay, or longer as may be mutually agreed upon by the Parties in writing, or the performance rendered impossible may be excused in writing by the Party so notified. In no event shall adverse market or financial conditions constitute an event of force majeure extending the time for such Party's performance hereunder. 8. NOTICES. Any demand upon or notice required or permitted to be given by one party to the other shall be in writing, shall be made in the following manner, and shall be effective (a) upon receipt if given by personal delivery, (b) on the date indicated on the receipt if given by certified or registered mail, retunn receipt requested, or (c) on the succeeding business day after mailing or deposit if given by Express Mail or by deposit with a private delivery service of general use (e.g., Federal Express), postage or fee paid, as appropriate, addressed to tine parties as set forth below. Notice of a change of address shall be given by written notice in the manner set forth in this section. For the purposes of this MOA, all information, requests, or other business including any demand upon a party or notice pursuant hereto shall be coordinated through the following agency representatives: City of Newport Beach Attn: David Kiff, City Manager (with copy to City Attorney's Office) 3300 Newport Blvd, Newport Beach, CA 92658 -8915 The New Hone Company Southern California LLC Tom Redwitz, President 95 Enterprise, Suite 325 Aliso Viejo, CA 92656 IN WITNESS WHEREOF, City and New Home have executed this MOA as of the date first written above. [SIGNATURES ON THE FOLLOWING PAGE) 30 ATTEST: wo Leilani Brown City Clerk APPROVED AS TO FORM: B ron Harp Z City Attorney CITY OF NEWPORT BEACH, A Municipal Corporation By: Nancy Gardner Mayor THE NEW HOME COMPANY SOUTHERN CALIFORNIA LLC, a Delaware Limited Liability Company Tom Redwitz President 31 S2 EXHIBIT "A" LEGAL DESCRIPTION Or THE PROPERTY 10 33 S4 Exhibit "A" Legal Description PARCEL 1, IN THE CITY OF NEWPORT BEACH, COUNTY OF ORANGE, STATE OF CALIFORNIA, AS PER MAP 2004 -225 FILED IN BOOK 361 PAGES 1, 2 AND 3 OF PARCEL MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY, AS MODIFIED BY THE PARCEL MAP CERTIFICATE OF CORRECTION RECORDED APRIL 23, 2008 AS INSTRUMENT NO. 2008000190230. EXCEPT ANY AND ALL OIL, OIL RIGHTS, MINERALS, MINERAL RIGHTS,, NATURAL GAS RIGHTS, AND OTHER HYDROCARBONS BY WHATSOEVER NAME KNOWN, GEOTHERMAL STEAM AND ALL PRODUCTS DERIVED FROM ANY OF THE FOREGOING, THAT MAY BE WITHIN OR UNDER THE PARCEL OF LAND HEREINABOVE DESCRIBED, TOGETHER WITH THE PERPETUAL RIGHT OF DRILLING, MINING, EXPLORING AND OPERATING THEREFOR AND STORING IN AND REMOVING TFIE SAME FROM SAID LAND OR ANY OTHER LAND, INCLUDING THE RIGHT TO WHIPSTOCK OR DIRECTIONALLY DRILL AND MINE FROM LANDS OTHER THAN THOSE HEREINABOVE DESCRIBED, OIL OR GAS WELLS, TUNNELS AND SHAFTS INTO, THROUGH OR ACROSS THE SUBSURFACE OF THE LAND HEREINABOVE DESCRIBED, AND TO BOTTOM SUCH WHIPSTOCKED OR DIRECTIONALLY DRILLED WELLS, TUNNELS AND SHAFTS UNDER AND BENEATH OR BEYOND THE EXTERIOR LIMITS THEREOF, AND TO REDRILL, RERINNEL, EQUIP, MAINTAIN, REPAIR, DEEPEN AND OPERATE ANY SUCH WELLS OR MINES; WITHOUT, HOWEVER, THE RIGHT TO DRILL, MINE, STORE, EXPLORE AND OPERATE THROUGH THE SURFACE OR THE UPPER 500 FEET OF THE SUBSURFACE OF THE LAND AS RESERVED IN THE DEED FROM THE IRVINE COMPANY, A MICHIGAN CORPORATION, RECORDED JANUARY 4, 1993 AS INSTRUMENT NO. 93- 003B05, OFFICIAL RECORDS ALSO EXCEPT ANY AND ALL WATER, RIGHTS OR INTERESTS THEREIN, NO MATTER HOW ACQUIRED BY GRANTOR, AND OWNED OR USED BY GRANTOR IN CONNECTION WITH OR WITH RESPECT TO THE LAND, TOGETHER WITH THE RIGHT AND POWER TO EXPLORE, DRILL, REDRILL, REMOVE AND STORE THE SAME FROM THE LAND OR TO DIVERT OR OTHERWISE UTILIZE SUCH WATER, RIGHTS OR INTERESTS ON ANY OTHER PROPERTY OWNED OR LEASED BY GRANTOR, WHETHER SUCH WATER RIGHTS SHALL BE RIPARIAN, OVERLYING, APPROPRIATIVE, LITTORAL, PERCOLATING, PRESCRIPTIVE, ADJUDICATED, STATUTORY OR CONTRACTUAL; BUT WITHOUT, HOWEVER, ANY RIGHT TO ENTER UPON THE SURFACE OF THE LAND IN THE EXERCISE OF SUCH RIGHTS, AS RESERVED IN THE DEED FROM THE IRVINE COMPANY, A MICHIGAN CORPORATION, RECORDED JANUARY 4, 1993 AS INSTRUMENT NO. 93- 003805, OFFICIAL RECORDS. 11 315 so EXHIBIT "B" AFFORDABLE ROUSING IMPLEMENTATION PLAN 12 37 S2 The New Home Company Santa Barbara Condominiums ms Affordable Housing Implementation Plan January 3 09 2012 39 TABLE OF CONTENTS 1. Executive Summary .............................. Background ............ ............................... Summary ................: if. Affordable Housing Implementation.... Payment of In -Lieu Pees ....................... Page ................. I ................. I ................. 1 ................. 2 ................. 2 IN New Home Company — Santa Barbara Condominiums Affordable Housing Implementation Plan Executive Summary Background In January, 2006, the City of Newport Beach approved General Plan Amendment No. 2004 -005, Local Coastal Program Land Use Plan Amendment No. 2005 -001, Tentative Parcel Map No. 2005 -014, Tentative Tract Map No. 2004 -004 (TTNI 16774), Traffic Study No. 2005- 002 and Coastal Residential Development Permit No. 2005 -004 and adopted Ordinance No. 2006 -1 approving Planned Community Development No. 2005 -003 amending Zoning District Map No. (48) to permit the development of 79 residential units on approximately 4.26 acres of land at 900 Newport Center Drive, known as the Santa Barbara Condominium Project (the "Project "). Condition 5 of the City Council Resolution 2006 -2 approving the project establishes the affordable housing requirement for the project, as follows: The applicant shall provide a minimum of 20% of the total units (16 units)•jor affordable income households in accordance with Housing Progr-ams 2.2.1 and 2.2.3 of the Afenporl Bench Hons•ing Element. The applicant shall enter into an agreement with the City to provide said units, which units may be provided off site, at an approved location wilhin the City. These u ails shall he idehl vied in the agreement and constructed and completed prior to the issuance of any c•erlijicale of occupancy for the project. The agreement shall he reviewed and approver/ by the Citydllo•ney and shall he executed and recorcled prior to the recordation of7he final tract mtnp or the issuance of a building at- grading permit for the proposed subdivision. The City of Newport Beach's Housing Element as approved by the City Council in July, 2006, after approval of the Project, includes an amended Housing Program 2.2.1, which sets the goal that 15% of all new housing units in the city be affordable to very low -, low- and moderate - income households. Pursuant to Section 19.54.060 of the Newport Beach Municipal Code, projects with more than 50 units are required to prepare an Affordable Housing Implementation Plan ( "AHIP ") that specifies how the development will meet the City's affordable housing goal. On May 11, 2010, the City Council adopted Ordinance No. 2010 -9 adding a new chapter to the Subdivision Code implementing Housing Program 2.2.1 of the Housing Element of the City's General Plan which allows for alternatives to on -site construction of affordable housing units, including payment of in -lieu fees for projects of fifty -one (5 1) dwelling units or more with approval of an AHIP. Summary On August 14, 2007, the City Council of the City of Newport Beach adopted Resolution 2007 -58 approving an Affordable Housing Implementation Plan for the Project (the "2007 AI -1IP ") as proposed by then - applicant Lennar Homes. Subsequent to approval of the 2007 AMP, The New Home Company has entered into an agreement with the landowner of the 4.26 acre site to acquire the site and develop the Project. 41 New Home Company — 'Santa Barbara Condominiums Affordable Housing Implementation Plan bi reviewing the provisions of the 2007 AHTP and as a result offuriller discussions on how the City would like to implement its inclusionary housing ordinance, the City and The New Home Company have agreed that the 2007 AHIP should be amended. The New Home Company has proposed this new 2012 Affordable Housing Implementation Plan ( "2012 ARTY') in order to address the City's objectives and to satisfy the provisions of the City's current Inclusionary Housing requirements as set forth in Chapter 19.54 of the Newport Beach Municipal Code and the Newport Beach Housing Element. Accordingly, The New Home Company, after extensive research on options for meeting the affordable housing requirements, and in consideration of the Chapter 19.54 of the Newport Beach Municipal Code and the adopted Housing Element requirement for 15% of all new units to be affordable, agrees to meet the requirements of the City Inclusionary Housing requirements and the Housing Element as described below. II. Affordable Housing Implementation Payment of In -Lieu Fees In accordance with the provisions of Section 19.54.050 of the Newport Beach Municipal Code, The New Home Company shall pay a fee in -lieu of constructing the affordable housing units required for the Project (the "In -lieu Fee "). The in -lieu Fee shall be paid at the rate in effect at the time of the issuance of each Building Permit, as that term is defined in the Memorandum of Agreement between the City and The New Home Company, for each market rate unit. 42 EXHIBIT "C" MASTER SITE PLAN 13 4s Ca' m 2 a N m N mm 3 N 9 r r a z a N m 7 m u EPT �nntnRnrbarn Condominiums Newport Beach, :'lw City Council Attachment B Project Vicinity Map 4j 42 VICINITY MAP Santa Barbara Condominiums PA2012 -012 900 Newport Center Drive 49 50 City Council Attachment C City Council Resolution No. 2007 -058 including previous AHIP and MOU 51 52 RESOLUTION NO. 2007-58 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH APPROVING AN AFFORDABLE HOUSING IMPLEMENTATION PLAN AND MEMORANDUM OF UNDERSTANDING FOR THE SANTA BARBARA CONDOMINIUM PROJECT AT 900 NEWPORT CENTER DRIVE (PA2004 -169) WHEREAS, on January 10, 2006, the City Council adopted Resolution No. 2006 -2, approving an application by Lennar domes for the development of 79 condominium units at 900 Newport Center Drive; and WHEREAS, the Resolution includes Condition 5, which establishes the requirements for the project to meet the affordable housing requirements in the City's Housing Element; and WHEREAS, on July 25, 2006, the City Council approved a comprehensive update to the General Plan, including changes in affordable housing requirements under an updated Housing Element; and WHEREAS, on March 27, 2007, the City Council adopted Ordinance No. 2€307 -6, amending provisions under which development agreements shall be required for residential projects to implement new policies and land use changes in the General Plan; and WHEREAS, Lennar has requested approval of an Affordable Housing implementation Plan that complies with the requirements of the updated Housing Element as satisfaction -of Condition 5; and WHEREAS, Lennar wishes to enter into. a development agreement to comply with Ordinance No. 2007 -6, vest its rights to develop the project as approved and establish a public benefit contribution to the City in the amount of five million dollars; WHEREAS., there are no limits on use of the payment from Lennar referenced in Section 2.A of the Memorandum of Understanding and use of these funds shall be as determined by the City Council. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Newport Beach as follows: SECTION I. The Affordable Housing Implementation Plan for Santa Barbara Condominiums, attached as Exhibit 1, is approved. 1 �3 SECTION 2, The Memorandum of Understanding between Lenniar Homes of California, Inc and City of Newport Beach, attached as Exhibit 2, is approved. SECTION 3. Resolution 2007 -55 Is hereby rescinded. Passed and adopted at a regular meeting of the City Council of the City. of Newport Beach held on August 14, 2007. 1 ATTEST: 54 Exhibit i Lennar Homes Santa Barbara Ci 1 t: JUIY 24, 2007 1515 Lennar Homes — Santa Barbara Condominiums Affotd.able Kousiag implementation Plan page 2 Table of Contents I. Execrative Summary 3 Background 3 City Process 3 Summary 3 Td'. Affordizble Housing.Project Desm iption 4 Unit Descriptions 4 Renovations 4 Buildings/Common Areos 4 Maintenance 5 Project Location Map Site Photos III. Consistency with. Housing Element IV. Income € end RentLiruits o 10 Appendix.A -- City ofNeurport Beach ResoIuti!on ofApf avid 11 50 Lennar Homes — Santa Barbara Condominiums Affordable Housing Implementation Plan Page 3 I. T.xccknive, summ.aay In - January 2oo6 the City of. Newport Beach approved a General :Plan Amendment, Coastal Land Use Plan Amendment and Planned Community Text for a project being proposed by I.ennar Homes. The project consists of 79 market ratesingle- family condominiums in Newport Center,. adjacent to' the .Newport Beach Marriott on the former tennis court site. Condition 5 of the City Council Resolution approving the project establishes the affordable housing, requirement for the project, as follows: 2'he applicant shall provide a minimum of?o% qf- the total units (t6 units) for affordable income households in accordance with Plousing Programs a.2.,t and 2.2.3 of the Newport Beach Flousing Element. The applicant shall enter into an agreement with the City to provide said units, which units maybe provided off - site, at an approved location within the City. These units shall be identified in the agreement and constructed and completed prior to the issuance of any cert#fcate of occupancy for the project. Tice agreement shall be reviewed and approved by the City Attorney and shall be execrated and recordedprior to the recordation of the f nal h•oct map or the issuance of a building or grading permitfor the proposed subdivision. B_aek=quAid The City of Newport Beach's Housing Element as approved by the City Council in July, 2oo6, after approval of the Lennar project, includes an amended Housing Program 2.2.1, which sets the goal that 15% of all new housing units in the city be affordable to very low -, low- and moderate-income: households. Projects with more than 5o units are required to prepare an Affordable Housing Implementation Plan (AHIP) that specifies how the development will meet the City's affordable housing goal. City Process Upon submittal of the :Santa Barbara Condominium project to the city, Lennar began working with time: city staff to evaluate scenarios to comply with the Housing Element. Due to the lack of available land In Newport Beach, Leunar gained conceptual consent of the City Council's Affordable Hotiksing Task Force to purchase covenants to restrict existing, market rate units to moderate - income households and rents affordable to them. SW a�x After extensive. research on options for meeting the affordable housing requirements, meeting with the Affordable Housing Task Force, and in consideration of the newly adopted Housing Element requirement for 15% of all new units tobe affordable, Lennar agrees to meet the recluirements;of the City Council condition of approval and the July 2oo6 Housing Element as described below. 57 Lennar Homes — Santa Barbara Condominiums Affordable Housing Implementation 'Plan Page II. Affordable Housing Project Description The Newport Courtyard Apartments at 1128-3.142 Rutland Road, Newport Beach is an existing,; market rate, 12 -unit apartment complex. Lennar will satisfy its affordable. housing requirement through.the purchase and recordation.of covenants that restrict the. occupancy of the apartments to qualifying moderate- income households, and restrict the rental rates as affordable to these households, for 30 years. An Affordable Housing Agreement among the City of. Newport Beach, Lennar and the property owner shall be executed and recorded prior to the recordation.of the final tract map or the .issuance of a building or grading permit for the Lennar. project. Unit L1escxraYSlia3 s The apartment complex consists of two separate buildings that face a common courtyard area that features a swimming pool. &ch building contains six units and .a laundry room. The units are generously sized at approximately 1,1oo square feet. The apartments all contain Mo bedrooms and two bathrooms and a dining area. Each unit has one assigned carport.. WEle the units were built in.rg61, the owner is currently undertakinga significant renovation effort to upgrade the complex. Kgq- Ovations Comprehensive renovations to the property to make the complex comparable with more recently constructed projects and ensure that it provides viable housing opportunities for the term of the covenants will be completed prior to the issuance of any certificate of occupancy for the Lennar project, as required by the City Council condition of approval. The renovations will include the following: BuildiMjs /Commorn A reas • Recovering of the existing stucco on the building fagade with Hardiplank Select Cedarmill Siding • Complete replacement of•all roof materials ® Exterior repainting of the entire complex, including the iron (handrails • Installation of new vertical wrought iron pickets between the existing pickets on the railings in the courtyard area • Installation of new redwood fencing on the back side of both buildings, enclosing rear patio/ porch areas • Replacement of fences enclosing patio areas for each unit adjacent to the common courtyard with lower landscape shrubs to allow visibility and openness in the courtyard area for each apartment • Renovation of both laundry rooms to include: • New 30 gallon electric water heaters and non -burst water supply lines • New countertop for folding clothes • New vinyl flooring, windows and doors • Installation of new motion detecting light fixtures in the garage area • Replacement of concrete in the central common area with pavers throughout the courtyard ■ New landscaping throughout the property 152 Lennar Homes — Santa Barbara Condominiums Affordable Ilowing Implementation '.Plan Page � units Kitchens • Complete kitchen remodel of two units with. new appliances,.countertops, cabinets and sinks • Replacement of sevens -year old appliances with new ones in two units • Maintenance of appliances less than three }rears old in eight units .Bathrooms o Rep] acem ent of all toilets with new, tow -flow toilets • Replacement of all shower heads with new, low -flow shower heads Windows and Doors • Installation of new vinyl windows and sliding glass doors • Insallation of new Dutch style front doors in all :c2 units Waits and Floors • Repainting of all units' interiors • Installation of new carpet in each unit MaInQeraana e The property will be maintained and preserved in good condition, in good repair, and in a decent, safe, sanitary, habitable and tenantable condition. All units will be fit for occupation by human beings and substantially comply with state and local. building and health codes. At a minimum, all rental units shall have the following: • Effective waterproofing and weather protectivn of roof and exterior walls, including unbroken windows and doors • Plumbing facilities in good working order, including hot and cold running water, kitchen sink; working toilet, wash basin, and bathtub or shower, connected to a sewage disposal system • Gass facilities in good working order • dealing facilities in good working order • An electric system, including lighting, wiring, and equipment; in good working order • Clean and sanitary buildings, grounds, and appurtenances (for example, courtyard, swimming pool and carports), free from debris, filth, rubbish, garbage, rodents, and vermin. • Adequate trash receptacles in good repair • Floors., stairways, and railings in good repair • Safe fire or emergency exits leading to a street or hallway • Stairs, hallways, and exits kept litter -free • Storage areas; garages, and basements kept free of combustible materials • Operable deadbolt locks on the main entry doors of rental units, and operable locking or security devices on windows • Working smoke.detectors in all units and in common stairwells 59 Lermar Homes — Santa BarbaraCoodominiums Affordable Flausing Implementation Plan. Page 6 o Ground fault circuit interrupters . for swimming pools and antisuction protections M& I.ennar Homes — Santa'.Baiba'ra Condominiums Affordable Housing ImplementaHon Plan. Page 7 krnjeet LQca -don Map 01 Lennar Homes — Santa Barbara Condominiums Affordable. Housing Implementation Plan Page 8 02 Homes — Santa Barbara Condominiums ble Housing Implementation Plan I11. Consistency with Housing Element The City of Newport Beach completed a comprehensive General. Plan update in 2006. The Housing Element was included in the update to ensure consistency with the updated Land Use Element. The Housing Element details a number of goals foe the.City; which include the following: promoting quality residential development through application of sound planning principles and policies that encourage preservation, conservation, and appropriate redevelopment of housing stock; providing a balanced residential Community that contains a variety of.housing types, designs and opportunities for all economic segments of the community; extension of affordability covenants with cn ners of existing affordable apartinents; preserving and increasing housing affordability, through rental housing, for very low- and low- income households; and providing housing for special needs groups. The affordable housing apartment complex.achieves.a number of the.above goals, including promoting quality residential development; preserving and increasing housing affordability and contributing to balanced residential community through rental housing. By converting 12 existing, market rate rental units exclusively for Moderate Income Households for 30 years, the project increases'housing affordability in the City and preserves .rental housing that might otherwise be converted to condominiums. The affordable housing apartment complex is consistent with a number of the goals and policies in the Housing Element. Listed below is a matrix of where the Housing Element and project are consistent Goal Project Consistency H: a Project renovates and preserves an existing Quality residential development and apartment community in Newport Beach preservation, conservation, and and adds deed restrictions to all la units appropriate redevelopment of housing for 30 years to restrict rental to qualifying stock moderate income households H 3 Project provides for j.2 additional rental Housing opportunities for as many renter units available to Moderate Incorne and owner occupied households as Households possible in response to the d emand for housing in the city O3 Lennar Homes — Santa Barbara Condominiums Affordable Rousing Implementation Plan. Page io W. Income and Rent Limits The Newport Courtyard Apartments at 1128 —1142 Rutland Road, Newport Beach will be restricted for rent by qualifying households. In order to meet the minimum eligibility .requirements the units must be rented to households qualifying as Moderate Income Households. Moderate Income Households will have income that does not exceed 120% of the Orange County ( "County "), California annualized median. family income ( "Moderate Income ") as then currently published by the United States Department of Housing and Urban Development ( "HUD ") for the Cou.ntybased on four (4) person households, as the sarne may be adjusted from time to time. Rent shall not exceed thirty- percent (3o %) of the income limit. 04 Lennar Homes a Santa Baa•bara Condominiums Affordable Housing Implementation Plan Page ii Appendix A City of Newport Beach Resolution ofApprodal [TO BE INSPit`C D) 05 00 Exhibit: 2. MEMORANDUM OF UNDERSTANDING BETWEEN LENNAR HOMES OF CALIFORNIA, INC. AND CITY OF NEVCTORT BE &CH 7166; Memorandum of 'Understanding ( "MOU") is entemd into by and betwecsr Lmnfu Homes of California, Inc: (" Lcanan and the City of Newport Beach (City), a municipal corporation, through its duly elected, appointed, qualified or acting representatives. RECITALS A. WHEREAS, on !January 10, 2006 the Newport Beach City Council approved! Resohrtion NO. 2006 -2 adopting Mitigated Negative Declaration (SCH NO. 2005 - 071067) and approved Genemt Plan Amendment No_ 2004-M5, Local Coastal Program land Use Plan Amendment No. 2005 -001, Tentative Parcel Map No. 2005 -014, Tentative Tract Map No. 2004 --004 (16774), Traffic Study No. 2005.002 and Coastal Residential Development Permit No. 2005 -004 and adopted Ordinance. No. 2006 -1 approving Planned Community Development 'No. 2005 -003 amending Zoning District Map No. (48) changing the subject property 'from CV -13 to RM -C for properly located at 900.Newport Center Dri ve (PA. 2004 -169); and B. - WHEREAS, on July 25, 2006 the City Council approved a comprehensive update of the City's General Plan, including changes in Affordable Housing Requirements under an updated Housing Element;. and C. WH:ERGAS, on March 27, 2007, the City Council adopted Ordinance No. 2007 -6, amending provisions under which development agreements shall ba roquired for residential development projects in the City to implement new policies and Land Use changes in the .new General Plan and requsring development agreements for projects that tegi sie: a le- pe-islatiti a act and include more than 50 units; and D. WHEREAS, on July 10, 2007 the California Coastal Commission approved City of Newport Beach Land Use Plan AmendmentNPB-MAJ -1 -06 Part. A (Marriott hotel VSIC to .MDRJSanta Barbara Condominiums) subject to modifications; and E WHEREAS, Lennar has requested approval of an Affordable Housing Implementation Plan (ARM) which documents Ler mar's commitment to the provision of 12 apartment units in the Moderate Incomz level for a period of 30 years and which will satisfy the intent of Condition No. 5 of Resolution No. 200&2 for affirdab'le housing; but wins comply with the amended rcquiretments for number of units of affordahle housing under the updated Housing Element. F. WHEMAS, concurrent with. and as consideration for the approval of the AHIP under the provisions of the updates! Housing Elemonl; flit; two parties 07 Memorandum of Understanding Between Lennw- Mornes.,ofQdtlarnfa, Inc. hind City af'Nekyport Beach Page -1 - wish to enter into a development agreement to vest the right to develop the project without additional public benefit contributions other than payment to the City of Newport Beach the amount of say million for the City to use for projects that provide a public benefit to the City as determined by the City Council. NOW, T13EREFORE, it is mutwlly agreed by and between the undersigned parties as follows: Section .1. The City shall give prompt consideration to the necessary support language for Coastal Commission approval of the Coastal Development Permit, and to the Affordable Housing Implementation Plan (AiIIP) required by the current Housing Element. Section 2. The parties will expeditiously prepare and theMwport Beach Planning Commission and City Council will promptly consider approval of a development agreement that includes the following principal provisions. The development agmement must be approved and executed before the issuance of any grading or building permit for the project. A. As a condition of the development agreement, Lgnnar shall pay $5 million tor the City of Newport Beach. This amount shall be paid in two installments, $2 million to be delivered concurrently with the issuance of the first residential building permit and $3 million to be delivered concurrently with the issuance of the final occupancy permit for all 79 homes. If the certificate of occupancy for the 79`i' unit.is riot issued within in 12' months of the first certificate of occupancy then the $3 million shall be due on a pro rata per unit basis for those units for which a certificate of occupancy has been issued and payable on a pm rats basis .for the ensuing units as each certificate of occupancy is .issued. Upon payment of this amount, no other payment shall be required for public benefit to the City of Newport. Beach. B. The City will expeditiously re,,aew the .Affordable Housing Agreement to implement the AHIP, and will. provide expedited review of development plans for the project, in support of timely receipt of building permits and final occupancy permits. C. City development approvals will be vested for a period not to exceed five (5) years: Section 3. The terms of this MOU shall become effective upon execution by both parties and shall continue thereafter until the satisfactory completion of the obligations of the parties as described herein. The MOU may be altered, changed, or amended by mutual consent of the parties. Any changes or amendments must be in writing and signed by the parties before such change or amendment shall take effect. Section 4. The MOU is executed in counterparts, each of which shall be considered a duplicate original, 02 Memorandum of Unders!anding Bet we enLennarRames.ofCalifgrhla, Inc. And CEay of Kewpnrl Heach Page -3 - Section 5. Notices: Any demand upon or notice required or permitted to be given by one party to the other shall be in writing, shall be made in the following [Wanner, and shall be effective (a) upon receipt if given by personal delivery, (b) an the date indireated on the receipt if given by certified or registered mail, return receipt requested, 'or (c) on the succeeding business day after mailing or deposit if given by Express Mail or by deposit with a private delivery service of general use (e.g. .Federal Express), postage or fee paid, as appropriate, addressed to the parties in Paragraph 17, Notice.of a change of address shall be given by vrritten notice. in the manner set forth in fts section.. Section 6. For the purposes of this MOU, all snfannation, requests, or other business including any demand upon a party or notice pursuant hereto shall be coordinated through the following agency representatives: City of Newport Burch Homer Bludau, City Manager 3300 Newport Blvd. Newport Beach, CA 92658 -891.5 Lennar F3omes. of California, Inc. Mr. John Baayoun Regional Vice President. 25 Enterprise Alisa Viejo, CA 92656 ectiooa 7. This MOU shall'be binding upon and shall inure to the benefiit of the succe±,-sors•and assigns of the parties. Section 8. This MOU "shat] be governed by, and construed and enforped in. accordance with, the laws of the State of California. APPROVED AS TO FORM: CITY OF NEWPORT BEACH, A Municipal Corporation By: Robin Clauson City Attorney ATTEST: By: L.aVonne Harkless City Clerk Steven Rosansky Mayor Lennar. Homes of California, Inc. By :, John Baayoun Regional Vice Fresident 09 STATE OF CALIFORNIA } COUNTY OF ORANGE CITY OF NEWPORT BEACH } i, Leilani 1. Brown, Deputy City Clerk of the City Of Newport Beach, California, do hereby certify -that the whote number of members of the City Council is seven; that the foregoing resolution, being Reawlution No. 2007 =58 was duly and rWAa.rly introduced before and adopted by the City Council. of raid City at a regular meeting of said Counpil, duly and 'regularly herd on the 14th day of August 2007, and that the same was so passed and adopted by the following vote, to wit: Ayes: Henn: Curry, SeUch, Daigle, Gardner, Mayor Rosansky Noes: None Absent: Webb Abstain: None IN WITNESS WHEREO.F', i have hereunto subscribed my name and affixed the official seal of said City this 15th, day of August 2007. �P4 &jkj�4x v _�� Dep uty City Cleric Newport Beach, California r / D City Council Attachment D September 11, 2007 City Council Minutes 71- 72 City of Newport Beach City Council Minutes September 11, 2007 Planning Director Lepo reported on the following items: Code Amendment 2007 -006 (Group Occupancies and Short -term Lodgings) during the August 23 meeting; and Liberty Baptist Chinch School Expansion (PA2006 -079) - 1000 Bison Avenue, and Paninu Cafe (PA2007 -063) - 2421 E. Coast Highway during the September 6 meeting. XVIII. CONTINUED BUSINESS 21. USE OF FUNDS FROM LENNAR HOMES OF CALIFORNIA, INC. IN CONNECTION WITH DEVELOPMENT AGREEMENT FOR SANTA BARBARA CONDOMINIUMS (contd. from 8114/07) (C -3979). 1381100-20071 Mayor Pro Tem Selich reported that, since this item was first brought before Council, the City has entered into negotiations for a development agreement with The Irvine Company which involves a substantial amount of park fees being generated in Newport Cotter. He believed that it would be appropriate to table this item and bring it back at a future date after the Newport Center development agreement has been brought before Council. Motion by 14In"r Pro Tem Selich to table and remove the item from the calendar. The motion carried by the following roll call vote: Ayes: Council Member Henn, Council Member Curry, Mayor Pro Tem Selich, Mayor Rosansky, Council Member Webb, Council Member Daigle, Council Member Gardner XIX, CU$ N—T BUSINESS S22. RESOLUTION CREATING AN AD HOC COMMITTEE ON GROUP RESIDENTIAL LEGAL REVIEW. 1100-20071 Council Member Henn reported that the resolution in the staff report is to hire outside legal counsel to assist with group home issues and appoint Council Members to a committee that will interview law firms and make a recommendation to Council as to which law firm to hire. However, the City Attorney recommended that the outside legal counsel have sole legal advisory on this issue, therefore, the resolution would need amending. He added that this expansion in scope will save the City money slid free up the City Attorney's time to work on other issues. He indicated that Ire hopes a law firm is hired at the "September 26 meeting. Mayor Rosansky expressed support so that there will be a quicker and more agreeable resolution to this issue. He pointed out that this would free up the City Attorney to work on other matters. In response to Council concerns; City Attorney Clausen indicated that there is no reason why they can't continue doing the work and aid in the transition. Mayor Pro Tem Selich believed that the Planning Commissiori should be made aware that Council expects them to continue to move forward. City Attorney Clauson added that Council can give her direction to continue to serve the Planning Commission until at least their next meeting, have the hearing on September 20, and have the Commission decide how to proceed. Mayor Rosansky indicated that there are some Planning Commissioners that are uneasy with what Council is proposing since they are currently working with information from a law firm that Council will soon be terminating. Council Member Webb indicated that he will be supporting this since the City Attorney's office is being drowned with the amount of time this issue is taking. He commended their office for putting together the current ordinance and hoped that the new law firm will not Volume 68 - Page 270 �, Feb 28 2012 4:55PM Hawkins Law Offices 1949) 650 -1181 P.2 �TL/ �V 'TECEILdeB R P LAW OFFICES OF KINS . NIZ;k° � JJd- 0 &I FEB 28 PM 5: 18 r -cc of Febru 2 ZQ1 CLFR K W H Via Facsimile Nancy Gardner, Mayor Members of the City Council City of Newport Beach 3300 Newport Blvd. Newport Beach, California 92663 Re: Dear Honorable Mayor and Members of the City Council: Thank you for the opportunity to comment to comment on the captioned matter. This firm represents Friends of Dolores and others in the City in connection with the captioned matter. This matter was approved over six years ago, many Newport Center project ago and one General Plan ago. First and most importantly, the environmental analysis is stale and requires supplementation. In Berkeley Keep Jets Over the Bay Corn, v. Board of Port Cmrs. (2001) 91 Cal. App. 4th 1344, 1367, the court held that by using dated information, environmental impact report ( "EIR ") for an airport expansion did not satisfy CEQA's requirement that environmental analysis must be "a reasoned and good faith effort to inform decisionmakers and the public .. „” See Guidelines section 15151 (requiring that environmental analysis be made with sufficient detail that it be adequate, complete and a good faith effort at full disclosure.) Second, the staff report recognizes that the Project may require supplemental analysis. It notes that we argued that the cumulative impacts of the subsequent projects including the new City Hall Project, the North Newport Center Project, the Hyatt Project, and the Newport Golf Country Club Projects require additional analysis for the captioned Project. The staff report notes: "all cumulative impacts of the subject project with the other identified projects have been examined as part of the cumulative impact analyses of those subsequent projects." Staff Report, page 5. First, the Mitigated Negative Declaration for the captioned Project did not contain any list of identified projects. Section 4.1 regarding cumulative impacts states: "The proposed project would not have environmental impacts, which are individually limited but cumulatively considerable, when considering planned or proposed development in the immediate vicinity of the site. The proposed project would not I10 Newport Center Drive, Suice 200 Newport Beach, Califomia 92660 (949) 650.5550 Fax: (949) 650.1 181 Feb 28 2012 4:55P11 Hawkins Law Offices. (949) 650 -1181 p.3 The Hon. Mayor Gardner Members of the City Council . 2 . February 28, 2012 cumulatively lead to significant adverse impacts, when added to proposed, planned or anticipated development in the area." MND, page 3 -66. Indeed, the January 10, 2006 Staff Report notes that the applicant requested a continuance "in order for the applicant to finalize'their discussions with the Newport Beach Country Club regarding the interface between the golf course and the proposed residential project." Obviously, the MND did not, and could not, analyze the impacts of the Newport Beach Country Club Project and the Golf Realty Project which among other things will eliminate 17 tennis courts in the City. The Project will eliminate "the Newport Marriott tennis complex which includes eight tennis courts, an associated club house and parking utilized by the Newport Beach Marriott." MND, page 2 -3. The Golf Realty Project eliminates 17 tennis courts. The cumulative impacts of these losses of recreational resources must be analyzed by a supplemental MND. Moreover, the Golf Realty Project was proposed as requiring the transfer of 27 hotel units from the General Plan Anomaly No. 43 which is the Newport Beach Marriott Hotel and Spa site. The Golf Realty Project has yet to be approved. With the proposed transfer of 27 units, Anomaly No. 43 may not have 79 units for the captioned Project. This Project requires supplemental environmental analysis. Council should require this analysis. Finally, please note that our February 14, 2012 comment letter sought all notices in connection with this Project. We received no notice of this hearing. Again, please provide me with all notices, reports, findings, and environmental determinations regarding this Project. We will provide further and additional comments on the captioned matter in a timely manner. Of course, should you have any questions, please do not hesitate to contact me. Sincerely, FFICES OF ROBE T C. HAWKINS y: Robert C. Haw in RCHJkw cc: Leilani Brown, City Clerk 110 Newport Center Drive, Suite 200 Newport Beach, California 92660 (949) 650.5550 Fax; (949) 650.1181 Feb 28 2012 4:55PI1 Hawkins Law Offices (949) 650 -1181 P.1 Law Offices of Robert C. Hawkins 110 Newport Center Drive, Suite 200 Newport Beach, California 92660 (949) 650 -5550 Fax: (949) 650 -1181 TRANSMITTED TO: NAME FAX NUMBER PHONE NUMBER Leilani Brown, City Clerk (949) 644 -3039 From: Robert C. Hawkins Client/Matter: Firm Date: February 28, 2012 Documents: Comments on 2/28/12 Agenda Item No. 20 Pages: 1 * COMMENTS: Original will follow as indicated. The Information contained in thisfahcsimile message Is information protected by attorney - client and /or the atrarney/work product privilege. It is intended only for the use of the individual named above and the privileges are not waived by virtue of this having been sent by facsimile. If the person actually receiving thisfacsimile or any other reader of the facsimile is not the named recipient or the employee or agent responsible to deliver it to the named recipient, any use, dissemination, distribution, or copying of the communication is strictly prohibited. If you have received this communication in error, please immediately notes us by telephone and return the original message to us at the above address via U.S. Postal Service. * NOT COUNTING COVER SHEET. IF YOU DO NOT RECEIVE ALL PAGES, PLEASE TELEPHONE US IMMEDIATELY AT (949) 650 -5550. -t wpq% 34 -Z� c .�® \t-IFOVL City Council February 28, 2012 Santa Barbara Condominiums Affordable Housing Implementation Plan Amendment and Memorandum of Agreement (PA2012 -012) Project _ Site 00 Newport Center Drive SANTA BARBARA ORWE LLD NEWPORT SEACH COUNTRY CLUB GOLFCOURSE Site Plan i E -i Urlglnal Project CLUP Amendment AHIP and MOU Coastal Development Permit I� Current Expiration Date Date 1/10/06 City Counc 7/24/07 City Counc 8/14/07 City Counc 9/05/09 Coastal Cc 9/05/14 roject Background AHIP Amendment Pay housing in -lieu fees $20,544/du Inclusionary (approx. Housing Burden on City $1.6 million) Ch. and HP 2.2.1 Allows leverage of funds Deeper affordability RH NA credit ew Home Company Request Memorandum of Agreement Supersede prior MOU Amend AHIP Waive development agreement $5 million Public Benefits Fee No vesting of rights Allow phasing & separate permits Sales Trailer New Home Company Req Adopt Resolution to: Amend AHIP Approve MOA Waive development agreement Rescind Resolution No. 2007 -05E Staff Recommendation PHASE 7 -SITE PLAN hase 1 NEWPORT BEACH COUNTRY CLUB GOLF COURSE NEWPORT BEACH COUNTRY CLUB GOLFCOURSE PHASE 2 -SITE MASTER PLAN hase 2 Subsequent MND not required CEQA Guidelines Sec. 15162 No change to effect pursuant project and approvals still AHIP and MOA - not substantial change No new or increase in environmental effects significant A Determination f'�•Llt!��TIC�r� STATE OF CALIFORNIA) ) SS. COUNTY OF ORANGE ) I am a citizen of the United States and a resident of the County of Los Angeles; I am over the age of eighteen years, and not a party to or interested in the notice published. I am a principal clerk of the NEWPORT BEACH /COSTA MESA DAILY PILOT, which was .adjudged a newspaper of general circulation on September 29, 1961, case A6214, and June 11, 1963, case A24831, for the City of Costa Mesa, County of Orange, and the State of California. Attached to this Affidavit is a true and complete copy as was printed and published on the following date(s): Saturday, February 18, 2012 I certify (or declare) under penalty of perjury that the foregoing is true and correct. Executed on February 22, 2012 at Los Angeles, California Signature n RECEIVED ZUIZ FEB 24 All 9: 37 T CITY C I