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.
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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.
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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
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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'� ���
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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
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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