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1998-0407_LINC HOUSING CORPORATION_Agreement0 AGREEMENT This Agreement (the "Agreement") is made this %qday of i, 1998 by and between the San Juan Capistrano Community Redevelopment Agency (hereinafter "Agency") and LINC Housing Corporation (hereinafter "Corporation"). WHEREAS, Corporation is a 501(c)3 non-profit Public Benefit Corporation formed to develop, acquire and operate affordable housing in Southern California, and WHEREAS, Corporation is exploring the possibility of acquiring the Capistrano Terrace Mobile Home Park (the "Park") from its owner, and WHEREAS, the City of San Juan Capistrano has adopted a General Plan with a Housing Element that has designated this mobile home park as an important source of low cost housing for the community, and WHEREAS, the City has enacted a rent stabilization ordinance which controls proposed increases for mobile home parks within the community, and WHEREAS, the City Council finds that it is in the public welfare and interest to take appropriate measures to preserve the existing low cost housing stock within the community, and WHEREAS, the Corporation has requested assistance from the Agency in determining the feasibility of acquisition of the Park, especially as the proposed acquisition relates to soils stability within the Park, and WHEREAS, the Agency has determined that it is essential that a qualified soils expert be retained to examine the stability of soils in and about the Park, NOW, THEREFORE, be it resolved between Agency and Corporation as follows: Section 1. Retention of Geolo-gist/Preparation of Report. Agency and Corporation hereby agree that a soils geologist, more specifically Petra Geotechnical, Inc. (hereinafter "Petra") be retained directly by Corporation to perform a soils study and prepare a report for the purpose of determining the stability of soils and slopes at the park. The scope of work to be performed shall be as set forth in Exhibit "A", attached and incorporated herein by reference. In addition, Corporation will work with the Agency in drafting an independent contractor agreement to be entered into between Corporation and Petra. • 0 Section 2. Ownership of Work Product. All reports, information, data and exhibits prepared by Petra as a result of this Agreement shall become the property of the Corporation and not the Agency. Section 3. Payment for the Report. Agency agrees to pay for the report, but in an amount not to exceed Thirty Two Thousand Dollars ($32,000). Agency shall pay Petra when Agency determines the work is complete. Method of compensation shall be pursuant to Exhibit "B", attached and incorporated herein by reference. Agency shall not be responsible for any additional costs associated with the study, unless Agency expressly approves a written addendum authorizing extra work. Section 4. Term and Termination. This Agreement shall be for a period of one year. The Agreement may be terminated by either party with ten (10) days written notice of termination in the event of nonperformance of any term of this Agreement by the other party. Section 5. Availability to Agency. When Corporation has certified that the report has been completed in accordance with the scope of work, as identified in Exhibit "A", Corporation shall upon request by the City make a copy available to Agency for its review. Section 6. Right of Review. Corporation shall afford Agency an opportunity to review the report for determining its completeness and consistency with the scope of work before Corporation makes a final certification that Petra's work product fulfills the requirements of its independent contractor agreement with Corporation. Section 7. Hold Harmless. Corporation agrees to protect, defend and hold harmless Agency, its elected and appointed officials and employees from any and all claims, liabilities, expenses or damages of any nature, including attorney's fees, for injury or death of any person or damage to property or interference with the use of property arising out of this Agreement. 0 0 Section 8. Notices. Any notices required to be given under this Agreement shall be sent to: Agency: Corporation: San Juan Capistrano CRA LINC Housing Corporation 32400 Paseo Adelanto 110 Pine Avenue, Suite 525 San Juan Capistrano, CA 92675 Long Beach, CA 90802 Attn: Executive Director Attn: Hunter L. Johnson Section 9. Entire Agreement. This Agreement constitutes the entire understanding and agreement between the Parties and supersedes all previous negotiations between them pertaining to the subject matter thereof. IN WITNESS WHEREOF, the Parties have executed this Agreement. ATTEST: Cheryl . ,l . TO FORM: Shaw, Agency Counsel Community Redevelopment Agency LINC Housing L. John$on, President FROM _ PETRR GEOTECHNICRL • PHONE NO. : 909 6996197 • � PETRA COSTA MESA • NEWPORT BEACH • SAN DIEGO • TEMECULA LINC HOUSING 110 Pine Avenue, Suite 525 Long Beach, California 90802 Attention: Mr. Hunter Johnson Mar. 23 199E 11:05RM P2 March 10, 1998 PN, 1219-98 Subject: Proposal to Provide Geotechnical Services, Preliminary Geotechnical Evaluation, Capistrano Terrace Mobilehome Park, San Juan Capistrano, Orange County, California In accordance with your request, Petra Geotechnical, Inc. (Petra) has prepared this proposal to provide geotechnical services at the subject site. We understand that potential buyers of the mobilehome park desire an evaluation of geotechnical conditions at the site. The mobilehome park is located on the lower portion of a previously identified ancient landslide. Preliminary reconnaissance of the mobilehome park indicated areas of slope failure or distress, distress to existing retaining walls and distress to the existing pavement. Based on our preliminary reconnaissance of the site, we anticipate that areas of concern will include gross and surficial slope stability, performance of retaining wall and evaluation of subgrade soils and existing pavement. The details of our proposal are presented herein, We propose to provide the following services. Review of available background data, published and proprietary, and scquential aerial photography. PETRA GEOTECHNICAL, INC. 27620 Commeme Centre Drive. Sude 103 Temecula. CA 92590 TeC (909)699.6197 FROM PETRA GEOTECHNICAL • PHONE NO. : 909 6996197 • Mar. 23 199E 11:06AM P3 LINC HOUSING March 10, 1998 Capistrano Terrace Mobilehome Park P.N. 1219-98 Page 2 • Field investigation, including - Underground utility location and mark -out; - Subsurface investigation consisting of eight to ten borings and six to eight backhoe pits to observe subsurface conditions onsite; and, - Geotechnical reconnaissance and mapping. • Laboratory testing of earth materials representative of those encountered during the subsurface investigation. • Geotecbnical and geologic analyses of field and laboratory data. • Preparation of a detailed report which address the following: - Review of previous geotechnical reports and investigation; - Geologic setting of the site; Potential geologic hazards, including seismicity, faulting and liquefaction potential; General subsurface soil conditions; Presence and effect of expansive and compressible soils; Groundwater conditions within the depths of subsurface investigations; Excavation and rippability characteristics of the foundation materials; - Stability of temporary and permanent cut -and -fill slopes and existing fills; Characteristics and conditions of existing fills; Types and depth of foundations appropriate for existing conditions; Allowable soil -bearing pressures for both native materials and compacted fills; Estimated total and differential settlements; - Corrosivity, pH, resistivity, water-soluble sulfates and chloride content of soil samples; Flexible and rigid pavement designs for a range of Traffic Index values; Seismic design criteria; and - Discussion of suitability of site for its current use with recommendations for remediation or mitigation of adverse conditions. Petra proposes to charge for our services on a time -and -cost basis in accordance with our Standard Fee Schedule (attached). However, based upon the scope of services outlined FROM : PETRR GEOTECHNICAL • PHONE NO. : 909 6996197 • Mar. 23 199E 11:06AN P4 LILAC HOUSING March 10, 1998 Capistrano Terrace Mobilehome Park P -N. 1219-98 Page 3 above, our total charges are not expected to exceed Thirty -Two Thousand Dollars ($32,000.00). No additional costs will be incurred for the geotechnical investigation without prior authorization. Our estimated fee covers the scope of services as previously described and includes preparation of reports for submittal to the regulatory agencies. Submittal of our report to the regulatory agency, post -report client meetings, consultation, agency contact and response to agency review will be billed as additional services on a time -and -cost basis in accordance with our Standard Fee Schedule. Furthermore, our proposal does not include grading, footing and utility -trench observation and testing. These services will be performed upon request on a time -and -cost basis in accordance with our Standard Fee Schedule. If unusual or unanticipated subsurface conditions are encountered in our field investigation, it may be necessary to increase the scope and cost of our study. If such is the case, we will inform you immediately to discuss what impact these unanticipated conditions may have on our study and our cost estimate for a revised scope. The work outlined in this proposal will be carried out in accordance with acceptable geotechnical principles common to the local area in which we practice. We make no other warranties, either expressed or implied. We will begin our first phase of investigation immediately upon authorization to proceed We anticipate that the field work will be complete approximately 3 weeks after authorization, weather permitting and subject to equipment availability. The reports will be available approximately 3 weeks after completion of the field work. We will maintain contact with you and your consultants during the course of the investigation to keep you informed of our findings and we will provide geotechnical FROM PETRA GEOTECHNICAL • PHONE NO. : 909 6996197 Mar. 23 199E 11:07AM PS LILAC HOUSING March 10, 1998 Capistrano Terrace Mobilehome Park P.N. 1219-98 Page 4 design parameters to you as soon as they are determined, if the above schedule for report delivery is not compatible with your time schedule. The opportunity to present this proposal is sincerely appreciated. If it meets with your approval, please sign a copy along with the attached Exhibit "A' - Conditions and return them to this office. If you have questions regarding the content or terminology, please contact us immediately. Any revisions must be agreed upon by both parties prior to commencement of work. Respectfully submitted PETRA GEOTECHNICAL, INC. Stephen W. Jensen Principal Geologist SWJ/keb Attachments: Standard Fee Schedule Exhibit "A" - Conditions Distribution: (2) Addressee FROM : PETRR GEOTECHNICAL • PHONE NO. : 909 6996197 • 0 V.110 IYA 30 21 D1 July 1, 1996 Principal Engineer/Geologist Senior Associate Engineer/Geologist Associate Engineer/Geologist Senior Project Engineer/Geologist Project Engineer/Geologist Senior Staff Engineer/Geologist Staff Engineer/Geologist Supervising Engineering Technician Senior Engineering Technician Engineering Technician Senior Public Works Technician Public Works Technician Deputy Geotechnical Inspector Deputy Concrete Inspector Deputy Masonry Inspector Laboratory Testing Draftsperson Xerox Rate Outside Consultants Drilling/Equipment Rental Postage Blueprints Travel & Transportation Subsistence Company Equipment Usage Mileage/Truck Usage Word Processing/Clerical * Costs for Field Density Testing are included_ t Four -Hour Minimum Mar. 23 199E 11:07AM P6 $125.001hr. $115.00/hr. $105.00/hr. $100.00/hr. $100.00/hr. $ 90.00/hr. $ 85.00/hr. $ 85.00/hr.* $ 65.00/hr. * $ 55.00/hr.* $ 75-00/hr $ 70.00/hr S 85.00Por $ 45.00/br. t $ 45.00/hr.t $ 75.00/hr. $ 65.00/hr. $ .25/sheet Cost & 20% Cost & 20% Cost Cost Cost Cost No Charge No Charge No Charge NOTE: One-way travel time from our office to field job sites is charged at the appropriate hourly rate when less than 8 hours of field time is required during any one day. When field time is 8 hours or more per day, there is no charge for travel. Overtime for technicians is $20 over the hourly rate. Overtime for deputy inspectors is 1.5 times the regular hourly rate. FROM : PETRA GEOTECHNICAL • LINC HOUSING PHONE NO. : 909 6996197 EXHI817 "4" - CONDITTnNC Mar. 23 199E 11:08AM P7 March 23, 1998 P.N. 1219-98 Page 6 The Client will provide for right of entry of Petra Geotechnical, Incorporated (PGI) personnel, as well as all equipment and other personnel necessary in order to complete the work. PGI will take reasonable precautions to minimize any damage to the property, but it is understood by the Client that in the normal course of work some damage may occur, the correction of which is not part of this Agreement_ The Client accepts this fact and will not hold PGI responsible for any damage other than that caused by gross negligence or willful misconduct of PGI or its personnel. In the prosecurion of this work, PGT will take all reasonable precautions to avoid damage or injury to subterranean structures or utilities. The Client understands that all such structures or utilities will not be known to PGI, and agrees not to hold PGI responsible for damage to subterranean structures or utilities which are not called to PGI's attention and fully and accurately described and located on the plans furnished. Services performed by PGI under this agreement will be conducted in a manner consistent with that level of care and skill ordinarily exercised by members of the profession providing similar services at the same time under the same conditions and locality. The Client acknowledges that subsurface conditions can vary from conditions encountered at the location where borings or explorations are made by PGI and that the data, interpretations of the data, and recommendations of PGI are based solely on the information which was available to PGI. PGI will not be responsible for any interpretation by others of data or information developed. The data obtained during the investigative phase is subject to confirmation by conditions which are encountered during the construction. The Client warrants that all information supplied by Client to PGI for their use in completing its services under this Agreement are accurate and sufficient for use by PGI, and that PGI can rely on their completeness and accuracy. Services provided by PGI may, at time, require subsurface explorations in areas where hazardous materials may be encountered_ The Client acknowledges and warrants that Client has no knowledge of, or reason to suspect, that hazardous materials are present at the subject site. Should hazardous materials be present or subsequently discovered, whether they are known or unknown by PGI, Client agrees to indemnify, defend and hold harmless PGI, its officers, employees, and agents or subcontractors from all claims which result, or are alleged in whole or in part, to the fault of PGI in providing their services that involves, in whole or in part, the presence of hazardous materials. The Client also agrees to compensate PGI for any and all time and/or expenses incurred by PGI in defense FROM PETRA GEOTECHNICAL . LINC HOUSING PHONE NO. : 909 6996197 Mar. 23 199E 11:0EAM PE LMA _4-1-1--s.n a a. March 23, 1998 P.N. 1219-98 Page 7 of any claim; for storage, transportation and disposal of contaminated samples; and for disposal of contaminated consumables and/or decontamination of equipment. All such compensation shall be based upon PGI's prevailing "Schedule of Fecs." PGI reserves the right to unilaterally suspend or terminate all services under this Agreement its sole discretion in the event that hazardous materials are discovered. If PGI's services are terminated or suspended, PGI agrees to negotiate in good faith a new agreement to continue to meet Client's needs. In the event any bill or portion thereof is disputed by Client, Client shall notify PGI within ten days of receipt of the bill in questions, and Client and PGI shall work together to resolve the matter within 30 days of its being called to PGI's attention If resolution of the matter is not attained within 30 days, either party may terminate this Agreement in accordance with conditions indicated below (see "Termination of Agreement"). If Client for any reason fails to pay the undisputed portion of PGI's invoices within 30 days of presentation, PGI shall cease work on the project and Client shall waive any claim against PGI, and shall defend and indemnify PGI from and against any claims for injury or loss stemming from PGI's cessation of service_ Client shall also pay PGI the cost associated with premature project demobilization. In the event the project is remobilized, Client shall also pay the cost of remobilization, and shall renegotiate appropriate contract terms and conditions, such as those associated with budget, schedule, or scope of service. Neither the Client or PGI may delegate, assign, sublet or transfer his or its duties or interest in this Agreement without the prior express written consent of the other party. In recognition of the relative risks and benefits of the project to both the Client and PGI, the risks have been allocated such that the Client agrees, to the fullest extent permitted by law, to limit the liability of PGI and its subconsultants to the Client and to all construction contractors and subcontractors on the project for any and all claims, losses, costs, damages or any nature whatsoever or claims expenses from any cause or causes, so that the total aggregate liability of PGI and its subconsultants to all those named shall not exceed $50,000.00, or PGI's total fee for services rendered on this project, whichever is greater. Such claims and causes include, but are not limited to, negligence, professional errors or omissions, strict liability, breach of contract or warranty. Client and PGI acknowledge that this provision was expressly negotiated and agreed upon. For an additional fee of $750.00 or five percent (5%), whichever is greater, of the fees paid by the Client to PGI for the project, PGI agrees to increase the total aggregate liability of PGI and its subconsultants to all those named to a mutually agreed upon amount not to exceed $ [__Client's Initials] FROM : PETRA GEOTECHNICAL • L1NC HOUSING i� X1:7 1 I "Vo [U.1 PHONE NO. : 909 6996197 0 Mar. 23 199E 11:09AM P9 011: s �It l Z March 23, 1998 P.N. 1219-98 Page 8 Either the Client or PGI may terminate this Agreement at any time with or without cause upon giving the other party 10 calendar days prior written notice. The Client shall within 30 calendar days of termination notice pay PGI for all services tendered and all costs incurred up to the date of termination, in accordance with the compensation provisions of this contract. The Client agrees to hold PGI harmless from any claims against PGI arising out of any future work provided by replacement consultants should the Client or PGI terminate their Agreement prior to completion of services and the Client then proceeding with the project. I/We have read this proposal and Exhibit "A" - Condit;mmc agree to the terms and conditions set forth, and authorize work to proceed These terms and conditions as set forth are binding upon those ordering and/or authorizing this work, and on the assigns or successors in interest NAME OF OWNER (Please Print) ADDRESS CITY/STATE/21P CODE TELEPHONE LENDER/CITY SIGNATURE OF OWNER/AUTHORIZED AGENT -EXkLA DATE San Juan Capistrano Community Redevelopment Agency April 9, 1998 Mr. Hunter Johnson, President LINC Housing Corporation 110 Pine Avenue, Suite 525 Long Beach, California 90802 Dear Mr. Johnson: C, At their meeting of April 7, 1998, the San Juan Capistrano Community Redevelopment Agency Board of Directors approved a agreement with LINC Housing Corporation providing that Petra Geotechnical, Inc., will be retained by LING Housing to perform a soils study and prepare a report to determine the soils and slope stability at the Capistrano Terrace Mobile Home Park. The agreement obligates the Community Redevelopment Agency to fund the report in an amount not to exceed $32,000. A fully -executed copy of the agreement is enclosed for your files. Please feel free to contact George Scarborough, Executive Director, at 443-6314 if you have any questions. Very truly yours, Cheryl John n Agency Secretary Enclosure cc: Richard Hall Mary Rose Winkler 32400 Paseo AdelanWilliam Talley San Juan Capistrano California 92675 714 - 493-1 171 A SOLUTION OF THE SAN JUAN CAPISTRANO COMMUNITY RED LOPMENT AGENCY, APPROVING THE COMMITMENT OF $100,0 FOR THE STATE OF CALIFORNIA COMMUNITY DEVELO NT BLOCK GRANT PROGRAM The motion carried by the ofowing vote: AYES: Directors erdlin, Jones, Campbell and Chairman Hart NOES: None ABSENT: Director Greiner 2. APPROVAL OF AN AGREEMENT WITH LINC HOUSING CORPORATION TO FUND A GEOTECHNICAL INVESTIGATION OF THE CAPISTRANO TERRACE MOBILE HOME PARK (PETkA GEOTECHNICAL- INC.) (600.40 Written Communications: Report dated April 7, 1998 from the Executive Director stating that, as requested in December 1997 by the Agency Board of Directors, staff had prepared an agreement with LINK Housing to provide for Agency funding of a geotechnical investigation of Capistrano Terrace Mobile Home Park by Petra Geotechnical, Inc. The cost of the geotechnical report would be $32,000 and was recommended as an appropriate use of Redevelopment Agency Housing set-aside monies. The Report further noted that the City's Housing Committee had reviewed the request and had recommended approval. Approval of Agreement: It was moved by Director Jones, seconded by Director Swerdlin, and unanimously carried, that the agreement with LINC Housing Corporation retaining Petra Geotechnical, Inc. to perform a geotechnical investigation of Capistrano Terrace Mobile Home Park be approved in an amount not to exceed $32,000.00. A RNMENT There being no fort sines before the Board, the meeting was adjourned at 8:03 p.m. to the next regular meeting date of Tues ril 21, 1998, at 5:30 p.m., in the City Council Chambers. ATTEST: I WY ART, NAIRMAN CRA Minutes Respectfully submitted, CHERYLJO S -3- SECRETARY 0 0 AGENDA ITEM TO: Chairman and Members of the Board FROM: George Scarborough, Executive Director April 7, 1998 SUBJECT: Consideration of an Agreement with LINC Housing Corporation to fund a Geotechnical Investigation of the Capistrano Terrace Mobile Home Park (Petra Geotechnical, Inc.) RECOMMENDATION: By motion, approve the agreement with LINC Housing Corporation retaining Petra Geotechnical, Inc. to perform a geotechnical investigation of Capistrano Terrace Mobile Home Park. SITUATION: A. Summary and Recommendation - Late last year, the City received a letter from the Capistrano Terrace Homeowners Association notifying the City of the Homeowners support of the sale of the mobile home park to a nonprofit corporation, LINC Housing Corporation. A copy of the letter is attached. In order to facilitate the sale, the Association requested the City fund a geotechnical report and lend LINC Housing Corporation the City's tax exempt status for the issuance of bonds to finance the purchase and rehabilitation of the mobile home park. The bonds would be paid for by the residents of the mobile home park. In December of last year, the Agency Board of Directors requested that staff return with an appropriate agreement with LINK Housing to provide for Agency funding of the geotechnical report. The cost of the geotechnical report will be $32,000 and is an appropriate use of Redevelopment Agency Housing set-aside monies. B. Background - The Capistrano Terrace Mobile Home Park is a valued source of affordable housing within our community. However, the park has deteriorated over the years and the infrustructure of the park will need to be rehabilitated or replaced in the near future. The revenue from the bond issuance would be used by LINK Housing Corporation to both acquire the park and rehabilitate or replace FOR Ci T Y COUNCIL AGEPl'� ��� 0 0 the streets, sewer, water, electric and natural gas facilities. The revenue generated by the rents paid by the residents will fund the bond repayments as well as the maintenance of the park. LINK Housing Corporation has stated that no rent increases will be necessary and has also committed that residents of the park would be included in the governing board. The Capistrano Terrace Mobile Home Park has experienced superficial ground slippage over the years and is located in the general area of a known, large ancient land slide. Neither LINC Housing nor the residents would be willing to acquire the park (nor would City staff be willing to recommend the City support their purchase of the park) without an independent geotechnical evaluation of the underlying geotechnical stability of the park. The present owner of the park is unwilling to fund an independent geotechnical evaluation and neither LINC Housing nor the residents have the resources to fund the evaluation. Funding of the geotechnical evaluation of the park to assist in the potential purchase of the park by a Housing Corporation is an appropriate and acceptable use of the Redevelopment Agency's Housing set aside and consistent with the goals of the Agency. LINC Housing will be retaining Petra Geotechnical, Inc. to perform the geotechnical evaluation. Formal consideration of the steps necessary to lend LINC Housing Corporation the City's tax exempt status will occur following the conclusion of the geotechnical evaluation. COMMISSIONBOARD REVIEW & RECOMMENDATIONS: The City's Housing Committee has reviewed the request of Capistrano Terrace Homeowners Association and has recommended City Council approval and support. FINANCIAL CONSIDERATIONS: The funding of the geotechnical investigation would be from Redevelopment Agency Housing set- aside monies. PUBLIC NOTIFICATION Capistrano Terrace Homeowners Association LINC Housing Corporation Mr. Richard Hall Mr. Bill Tally A TERNATE ACTIONS: 1. By motion, approve the agreement with LINC Housing Corporation retaining Petra Geotechnical, INC. to perform a geotechnical investigation of Capistrano Terrace Mobile Home Park. 0 2. Deny the request. 3. Request additional information. RECOMMENDATION: 0 By motion, approve the agreement with LINC Housing Corporation retaining Petra Geotechnical, INC. to perform a geotechnical investigation of Capistrano Terrace Mobile Home Park. Attachment: Agreement Location Map i _. Sr�yFykt Ips �oyvls+rzwo-Ycrrq�.� Moblic Rome, 6- "Jc :CAMINO LAS ppM � ;' L OCa,,I-con I � �' i CAPISTRANO TERRACE HOMEOWNERS ASSOCIATION SAN JUAN CAPISIRINO, CALIFORNIA November 16, 1997 Mayor and City Council City of San Juan Capistrano 32400 Paseo Adelanto San Juan Capistrano, California 92675 Dear Mayor Swerdlin and Members of the City Council, n As you are aware, Mr. Richard Hall's has offered to sell the Capistrano Terrace Mobile Home Park to a qualified Non Profit Corporation. LINC Housing Corporation, which is a certified non-profit 501 (c) (3) corporation, is the preferred choice of both the residents and Mr. Hall. On October 14, 1997 the residents of Capistrano Terrace were asked to vote on this matter, one vote per space, and 77% voted in the affirmative. This highly positive response was conditioned upon three premises. Q= the park would be sold to a qualified non-profit corporation that would include residents on the governing board. LINC Housing has agreed that no rent increases would be necessary and also believes that it would be beneficial to include residents on the Board of Directors to assure that the management of the park is responsive to the needs and concerns of the residents. Two, that an independent geotechnical report be prepared to evaluate the underlying geotechnical stability of the park. It would not be prudent for either LINC Housing or the residents to move forward without some reasonable assurance that the park is substantially sound. Th= One of the principal concerns of the residents has been continuing deterioration of the park over the years, particularly with the water, sewer, electric, and natural gas service facilities which the residents believe need to be replaced. Mr. Hall has agreed that the most effective remedy is to simply replace these facilities, which will involve trenching, the installation of new facilities, and repair and replacement of the roads in which the utilities are located. Mr. Hall has agreed to fund the replacement of these facilities out of the proceeds of the sale, provided of course that agreement is reached on the sales price and the replacement work. The residents of Capistrano Terrace are requesting the City Council for assistance by providing funding for the geotechnical report and, to issue tax exempt bonds to be paid for by LINC Housing and the residents of Capistrano Terrace. With respect to the Geotechnical Study, we believe that, in addition to providing assistance to Capistrano Terrace residents, the City would also benefit by having such a study conducted. If the report shows that the park is fundamentally sound, then the purchase transaction would proceed and an important source of affordable housing within the community would be NOV 2 0 1997 not only improved but maintained for many years to come. On the other hand, if the report reveals instability, then the City, the park residents, and the owner will be well advised of the adversities, the risk at hand, and measures required to correct problems that may be identified. There are several reasons why the City is being asked to provide funding for the geotechnical study. First of all, the City is independent, would insist on a thorough report with full disclosure, and would derive a benefit by knowing the underlying geotechnical condition of an important affordable housing resource. We are all aware that Capistrano Terrace was constructed well prior to the incorporation of the City and under County standards that would not pass muster today. Secondly, neither the residents or LINC Housing have the resources to commission such a study. LINC Housing, as a non-profit housing corporation derives its revenue from the non-profit housing endeavors it operates. LINC operates each housing endeavor independently and is required to spend revenues it receives from a given housing endeavor solely for the benefit of that endeavor. In other words each housing undertaking must be self sufficient and independent of others. The residents of Capistrano Terrace, as you know, are largely people of modest means and fixed incomes who lack the resources to undertake this study. The park owner, on the other hand, has advised that he does not see the need for such a study, nor is he willing to participate financially. For these compelling reasons, the residents of Capistrano Terrace turn to the City Council for assistance. The Capistrano Mobile Home Park is a source of affordable housing within the community, a resource that would be difficult to replace. We are all aware of the requirement placed on local government by the State to provide and maintain a stock of affordable housing within the community. The funding of the Geotechnical Study by the City would clearly be a contribution toward affordable housing. We believe that this is an opportunity for the City to advance this state mandated goal with relatively minimal expense to the taxpayer. Not only would this source of housing be preserved, it would also be significantly improved with the replacement of the on site water, sewer, natural gas, and electric utilities which are inadequate and of clearly questionable reliability. This would dramatically improve the quality of life for the residents and eliminate a potential health, safety, and welfare problem for the City. Lest one think that the residents are asking for or expecting a free ride, these improvements would be paid for out of the bond proceeds and will be ultimately repaid by the park residents through their rental payments to the non profit housing corporation, LINC Housing. The issuance of tax exempt revenue bonds in favor of the non-profit LINC Housing Corporation is a refinancing mechanism that will enable LINC to acquire Capistrano Terrace from its current owner, and also fund the replacement of the utility infrastructure. It is anticipated that it will do so without increasing the space rents currently paid by the residents. In addition, to funding much needed improvements, the governance of the park will change. The governing board of the non profit corporation will include elected residents of the park, who will have a very direct say in the day to day running of the park, including its maintenance, upkeep, and appearance. s The residents of Capistrano Terrace Mobile Home Park respectfully request the City Council to enable this process to move forward by providing the funding for an independent geotechnical analysis of Capistrano Terrace. This results of this study, if positive, will clearly pave the path for an orderly transition of Capistrano Terrace from affordable housing in distress to affordable housing with a future. On behalf of the residents of Capistrano Terrace, we wish to thank you for your support and your consideration. Sincerely, Purchase Committee Members, Capistrano Terrace Homeowners Association. cc: George Scarborough, City Manager Hunter Johnson, LINC Housing Corporation Gerald Gibbs, Atty. at Law. Richard Hall Bill Talley Steve Julian