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HomeMy WebLinkAboutResolution 2020-080 N.C.S. 06/01/2020Resolution No. 2020-080 N.C.S. of the City of Petaluma, California RESOLUTION OF THE CITY OF PETALUMA CITY COUNCIL APPROVING AND RATIFYING THE DISPOSITION, DEVELOPMENT AND LOAN AGREEMENT (DDLA) BETWEEN THE CITY AND PETALUMA ECUMENICAL PROPERTIES (PEP) FOR THE RIVER CITY SENIOR APARTMENTS PROJECT, A 54 -UNIT LOW- INCOME RENTAL HOUSING DEVELOPMENT (PROJECT) TO BE LOCATED AT 951 PETALUMA BOULEVARD SOUTH IN PETALUMA (PROPERTY) THAT WILL PROVIDE HOUSING FOR FIFTY-THREE VETERANS AND HOMELESS SENIORS, AUTHORIZING AMENDMENT OF THE DDLA TO PROVIDE $1.5 MILLION IN CITY IN -LIEU HOUSING FEES FINANCING FOR THE PROJECT, AND AUTHORIZING ASSIGNMENT OF PEP'S INTEREST IN THE DDLA AND THE PROPERTY TO A SUCCESSOR AGENCY FOR DEVELOPMENT OF THE PROJECT EFFECTIVE UPON CLOSING FOR CONVEYANCE OF THE LAND WHEREAS, in April of 2017, the City issued a Request for Proposals for the development of affordable housing on the City -owned property located at 951 Petaluma Boulevard South in Petaluma (Property), with submissions due on May 8, 2017; and WHEREAS, three proposals were submitted, staff reviewed all submittals, and held interviews with the proposers during the last week in May 2017; and WHEREAS, during the proposer interviews City staff communicated that the Property would be the City's contribution to the development of the affordable housing project; and WHEREAS, Petaluma Ecumenical Properties (PEP) proposed developing a project on the Property consisting of the construction of 53 one -bedroom rental housing units affordable for seniors of low and very -low income levels, plus one two-bedroom on-site manager unit and ancillary community rooms, with twenty-five of the residential units identified for senior veterans (Project), and PEP was selected to develop the Project on the Property; and WHEREAS, the City entered into an exclusive negotiating agreement regarding development of the Project on the Property with PEP on October 17, 2017; and WHEREAS, on August 14, 2018, the Petaluma Planning Commission adopted Resolution no. 2018-126 approving site plan and architectural review (SPAR) for the Project, including associated warrants and specified conditions of approval; and WHEREAS, on August 20, 2018, the City entered into a Development, Disposition and Loan Agreement (DDLA) with PEP addressing Project financing, Project approval, and other conditions that, once satisfied, would result in transfer of the Property to PEP subject to certain reservations allowing for access to the River Trail, for construction of the Project on the Property, resulting in the creation of additional senior affordable housing in the City, subject to affordability and other covenants specified in the DDLA; and Resolution No. 2020-080 N.C.S. Page 1 WHEREAS, on March 18, 2019, the City Council considered and expressed its support in response to a request from PEP to provide additional funding for the Project to close a $1,500,000 funding gap; and WHEREAS, in expressing support for the PEP request, the City Council directed that additional funding for the Project take the form of a combination of $906,000 of the City's HOME program funds and an additional $600,000 from other housing funds at staff discretion, with the City's Housing In -lieu Fee fund balance to be preserved to the extent possible; and WHEREAS, after March of 2019, PEP requested the City gap funding be provided from City Housing In -lieu Fee funds instead of the City's HOME program funds because of the delay that would result from the process required to access the City HOME program funds, and the resulting impact on commencement of the Project and related impacts on other Project funding; and WHEREAS, on February 24, 2020, the City Council gave staff direction to make arrangements for the City to contribute $1,500,000 from the City's Housing In -lieu Fee fund to the development of the Project in addition to the $1,300,000 land value, as appraised on June 25, 2019; and WHEREAS, in addition to support PEP has requested from the City of Petaluma for the development of the Project on the Property PEP has sought and obtained other federal, state and private financing for the construction of the Project, and such funding requires that PEP complete acquisition of the Property in accordance with the DDLA, obtain all City project permits and commence Project construction by approximately July 15, 2020; and WHEREAS, the City of Petaluma intends to support the development of the Project by transferring title of the Property to PEP and/or its successor in accordance with and subject to the terms of the DDLA; and WHEREAS, the City Council has given direction to allocate $1,500,000 of the City's Housing In -lieu Funds to PEP for the development of the Project on the Property; and WHEREAS, the Project qualifies for an exemption from review under the California Environmental Quality Act ("CEQA") pursuant to Section 15194 of the CEQA Guidelines pertaining to the affordable housing projects, as set forth in Planning Commission Resolution 2018-126 which was adopted on August 12, 2018 and approved the Project SPAR; NOW, THEREFORE, BE IT RESOLVED by the Petaluma City Council as follows: 1. The above recitals are hereby declared to be true and correct and are incorporated into this resolution as findings of the City Council. 2. The Project is exempt from CEQA review pursuant to the exemption for affordable housing projects in Section 15194 of the CEQA Guidelines as set forth in Planning Commission Resolution No. 2018-126 adopted on August 12, 2018. 3. The DDLA dated August 18, 2018 between the City and PEP concerning development of the Project on the Property is hereby approved and ratified. 4. Amendment of Article IV of the DDLA to provide an additional $1.5 million in Project financing from the City's Housing In -Lieu funds is hereby approved, and the City Manager is hereby authorized and directed to execute on behalf of the City a DDLA Amendment substantially in the form accompanying the staff report for this item, which amendment is hereby incorporated into and made a part of this resolution. Resolution No. 2020-080 N.C.S. Page 2 5. The City Manager is hereby authorized and directed to execute on behalf of the City an Assignment and Assumption of PEP's interest in the DDLA and the Property to River City Senior Apartments, L.P. as PEP's successor in accordance with and subject to the terms of the DDLA in such form as approved by the City Manager and the City Attorney. 6. The City Manager is hereby authorized and directed to execute any and all documents necessary to affect the purposes of this resolution and the DDLA, including any maintenance and other agreements and documents related to completion of the Project on the Property. Under the power and authority conferred upon this Council by the Charter of said City. REFERENCE: I hereby certify the foregoing Resolution was introduced and adopted by the App r e to Council of the City of Petaluma at a Regular meeting on the 1St day of June 2020, or by the following vote: AYES: NOES: ABSENT: ABSTAIN: ATTEST: Mayor Barrett; Vice Mayor Fischer; Healy; Kearney; King; McDonnell; Miller None None None wc—��- lj'e—puty'CClerk City Attorney Mayor Resolution No. 2020-080 N.C.S. Page 3