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HomeMy WebLinkAbout2007-55 - Affordable Housing ImplementationRESOLUTION NO. 2007 -55 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 Homes 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. 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; 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; NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Newport Beach as follows: Section 1. The Affordable Housing Implementation Plan for Santa Barbara Condominiums, attached as Exhibit 1, is approved. Section 2. The Memorandum of Understanding between Lennar Homes of California, Inc and City of Newport Beach, attached as Exhibit 2, is approved. Section 3. The payment from Lennar referenced in Section 2.A of the Memorandum of Understanding shall be advanced from the General Fund to the Park Fees Fund to facilitate early acquisition and improvement of parks. As future residential developers pay park in -lieu fees, the General Fund will be reimbursed. The City Council sets the following priorities for use of the advance to the Park Fees Fund. A. Newport Center Park B. Back Bay View Park enhancements C. Marinapark or Sunset Ridge Park, with equal priority, if the funds are not fully expended on A and B Passed and adopted at a regular meeting of the City Council of the City of Newport Beach held on July 24, 2007. MAYOR ATTEST: CITY CLERK Exhibit 1 Lennar Homes Santa Barbara Condominiums Affordable Housing Implementation Plan City of Newport Beach, CA July 249 2007 Lennar Homes - Santa Barbara Condominiums Affordable Housing Implementation Plan Page a Table of Contents L Executive Summary Background City Process Summary II. Affordable Housing Project Description Unit Descriptions Renovations Buildings /Common Areas rl Maintenance 5 Project Location Map 7 Site Photos 8 III. Consistency with Housing Element 9 IV. Income and Rent Limits 10 Appendix - City of Newport Beach Resolution ofApprovai 11 Lennar Homes — Santa Barbara Condominiums Affordable Housing Implementation Plan Page 3 L Executive Summary In January 20o6 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 Lennar Homes. The project consists of 99 market rate single - 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: 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. Background The City of Newport Beach's Housing Element as approved by the City Council in July, 2006, 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 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. City Process Upon submittal of the Santa Barbara Condominium project to the city, Lennar began working with the city staff to evaluate scenarios to comply with the Housing Element. Due to the lack of available land in Newport Beach, Lennar gained conceptual consent of the City Council's Affordable Housing Task Force to purchase covenants to restrict existing, market rate units to moderate - income households and rents affordable to them. Summary 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 to be affordable, Lennar agrees to meet the requirements of the City Council condition of approval and the July 20o6 Housing Element as described below. Lennar Homes — Santa Barbara Condominiums Affordable Housing Implementation Plan Page 4 II. Affordable Housing Project Description The Newport Courtyard Apartments at 1128 — 1142 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 Descriptions The apartment complex consists of two separate buildings that face a common courtyard area that features a swimming pool. Each building contains six units and a laundry room. The units are generously sized at approximately 1,1oo square feet. The apartments all contain two bedrooms and two bathrooms and a dining area. Each unit has one assigned carport. While the units were built in 1g61, the owner is currently undertaking a significant renovation effort to upgrade the complex. Renovations 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: Buildings /Common Areas • Recovering of the existing stucco on the building facade 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 Lennar Homes — Santa Barbara Condominiums Affordable Housing Implementation Plan Page 5 Units Kitchens • Complete kitchen remodel of two units with new appliances, countertops, cabinets and sinks • Replacement of seven -year old appliances with new ones in two units • Maintenance of appliances less than three years old in eight units Bathrooms • Replacement of all toilets with new, low -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 12 units Walls and Floors • Repainting of all units' interiors • Installation of new carpet in each unit Maintenance 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 protection 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 • Gas facilities in good working order • Heating 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 0 units and in common stairwells Lennar Homes - Santa Barbara Condominiums Affordable Housing Implementation Plan Page 6 o Ground fault circuit interrupters for swimming pools and antisuction protections Lennar:Homes — Santa Barbara Condominiums Affordable Housing Implementation Plan Page y Project Location Map Lennar Homes — Santa Barbara Condominiums Affordable Housing Implementation Plan Page 8 Lennar Homes — Santa Barbara Condominiums Affordable Housing Implementation Plan Page 9 III. 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 for 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 owners of existing affordable apartments; 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 a 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 1 Project renovates and preserves an existing Quality residential development and apartment community in Newport Beach preservation, conservation, and and adds deed restrictions to all 12 units appropriate redevelopment of housing for 30 years to restrict rental to qualifying stock moderate income households H 3 Project provides for 12 additional rental Housing opportunities for as many renter units available to Moderate Income and owner occupied Households as Households possible in response to the demand for housing in the city Lennar Homes — Santa Barbara Condominiums Affordable Housing Implementation Plan Page io N. 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 County based on four (4) person households, as the same may be adjusted from time to time. Rent shall not exceed thirty percent (30%) of the income limit. Lennar Homes - Santa Barbara Condominiums Affordable Housing Implementation Plan Page ii Appendix A. City of Newport Beach Resolution of Approval [TO BE INSERTED] EXHIBIT 2 MEMORANDUM OF UNDERSTANDING BETWEEN LENNAR HOMES OF CALIFORNIA, INC. AND CITY OF NEWPORT BEACH This Memorandum of Understanding ( "MOU ") is entered into by and between Lennar Homes of California, Inc., ( "Lennar ") 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 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 (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 -B to RM -C for property located at 900 Newport Center Drive (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. 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 D. 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; and E. WHEREAS, Lennar has requested approval of an Affordable Housing Implementation Plan (AHIP) which documents Lennar's commitment to the provision of 12 apartment units in the Moderate Income level for a period of 30 years and which will satisfy the intent of Condition No. 5 of Resolution No. 2006 -2 for affordable housing; but will comply with the amended requirements for number of units of affordable housing under the updated Housing Element. F. WHEREAS, concurrent with and as consideration for the approval of the AHIP under the provisions of the updated Housing Element, the two parties Memorandum of Understanding Between Lennar Homes of California, Inc- And City of Newport 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 $5 million for the City to use for projects that provide a public benefit to the City as determined by the City Council. NOW, THEREFORE, it is mutually 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 (AHIP) required by the current Housing Element. Section 2. The parties will expeditiously prepare and the Newport Beach Planning Commission and City Council will promptly consider approval of a development agreement that includes the following principal provisions. The development agreement 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, Lennar shall pay $5 million to 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`h unit is not 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 pro rata 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 review 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 sighed 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. Memorandum of Understanding Between Lennar Homes of California, Inc. And City of Newport Beach 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 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 in Paragraph 17. Notice of a change of address shall be given by written notice in the manner set forth in this section. Section 6. For the purposes of this MOU, 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 Homer Bludau, City Manager 3300 Newport Blvd. Newport Beach, CA 92658 -8915 Lennar Homes of California, Inc. Mr. John Baayoun Regional Vice President 25 Enterprise Aliso Viejo, CA 92656 Section 7. This MOU shall be binding upon and shall inure to the benefit of the successors and assigns of the parties. Section 8. This MOU shall be governed by, and construed and enforced in accordance with, the laws of the State of California. APPROVED AS TO FORM: CITY OF NEWPORT BEACH, By: Robin Clauson City Attorney ATTEST: By: LaVonne Harkless City Clerk A Municipal Corporation M Steven Rosansky Mayor Lennar Homes of California, Inc. 0 John Baayoun Regional Vice President STATE OF CALIFORNIA } COUNTY OF ORANGE CITY OF NEWPORT BEACH } I, LaVonne M. Harkless, City Clerk of the City of Newport Beach, California, do hereby certify that the whole number of members of the City Council is seven; that the foregoing resolution, being Resolution No. 2007 -55 was duly and regularly introduced before and adopted by the City Council of said City at a regular meeting of said Council, duly and regularly held on the 24th day of July 2007, and that the same was so passed and adopted by the following vote, to wit: Ayes: Henn, Curry, Selich, Gardner Noes: Webb, Daigle, Mayor Rosansky Absent: None Abstain: None IN WITNESS WHEREOF, I have hereunto subscribed my name and affixed the official seal of said City this 25th day of July 2007. (Seal) City Clerk Newport Beach, California