95-0817_CRA_Minutes_Adjourned Regular Meeting099
AUGUST 17, 1995
ADJOURNED REGULAR MEETING OF THE SAN JUAN CAPISTRANO
COMMUNITY REDEVELOPMENT AGENCY
BOARD OF DIRECTORS
The Joint Adjourned Regular Meeting of the Board of Directors of the City of San Juan Capistrano
Redevelopment Agency was called to order by Mayor Nash at 4:03 p.m. in the City Council
Chamber, to hold a joint Work Session with the City Council regarding a proposed affordable senior
apartment project.
ROLL CALL: PRESENT: David Swerdlin, Chairman
Carolyn Nash, Vice Chairman
Collene Campbell, Director
Wyatt Hart, Director
Gil Jones, Director
ABSENT: None
STAFF PRESENT: George Scarborough, Executive Director; Richard K. Denhalter, Legal Counsel;
Cheryl Johnson, Agency Secretary; Tom Tomlinson, Deputy Director; Cynthia Pendleton, Finance
Officer; William Huber, Engineering and Building Director.
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VyEingn Communications:
Report dated August 15, 1995, and resubmitted August 17, 1995, from the Deputy Director.
The Report advised that the proposed affordable senior apartment project consisted of 112
units, with 105 uncovered parking spaces, on 3.2 acres at the southwest corner of Ortega
Highway and Rancho Viejo Road. The application also included a 10,000 -square -foot
remainder parcel for construction of a future single-family detached unit at the most westerly
portion of the property. The applicant had requested $1.4 million in financial assistance from
the Community Redevelopment Agency in the form of a 5% low-interest loan to be paid back
over a 30 -year period. In return for the loan, there will be income and rent restrictions on all
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units for a period of 55 years, in accordance with tax credit requirements. The site is zoned
Planned Community District with a Senior/Household Affordable Housing Overlay. The
project may be allowed subject to approval of a Density Bonus Permit by the City Council.
The Report set forth issues relating to density; vehicular access from the Capistrano
Collection; the proposed single-family lot; parking and numerical standards; and, the
appropriateness of financial assistance. The Agency had been requested to review the
financial assistance program and provide direction regarding preparation of an Owner
Participation Agreement.
The Deputy Director made an oral presentation. Area photographs, colored renderings, and
the conceptual grading plan were on display. Mr. Tomlinson noted staffs intent to return
with an Owner Participation Agreement, which would be heard concurrently with the
development applications in a joint meeting of the City Council and Community
Redevelopment Agency, if the City Council felt the project was reasonable. Mayor Nash
advised that this was a work session only; review would still be required by the appropriate
City Commissions prior to final approval.
Annlicant's Presentation:
Michael Costa, President of Kaufman & Broad Multi -Housing Group; Tom Erickson, project
manager for this project; and, Manny Gonzalez, project architect, were present to provide
information about their proposal.
Mr. Gonzalez described the layout and visual aspects of the project, noting that it had been
designed so that individuals could circulate through the development without having to cross
the parking lot. In response to Director Campbell, Mr. Gonzalez advised that there would
be a pool and spa, a passive rose garden and benches placed through the development. Mr.
Costa advised that experience had shown that some outdoor amenities, such as shuffleboard
were not used, while swimming pools were used extensively.
Public Comments:
(1) Pauline Leonard, 27589 Brookside Lane, concurred with the 55 -year age limit and
advised she had no issues with the structure, arrangement of amenities, etc. Her
concerns centered around the potential financial commitments. She inquired
regarding the following, stating that these issues should be addressed prior to making
the final commitment: (1) whether all the units would be affordable and what criteria
was used to measure income levels; (2) when the pay back would begin; (3) whether
market studies were done to indicate the need for this project in the City; (4) whether
a method to monitor the project for continued affordability would be included; and, ^
(5) whether a change in status would be requested if the units could not be totally
filled by senior residents. She was advised that all of the units would be designated
as affordable; that State Housing and Urban Development guidelines were used to
measure income levels, with those guidelines being incorporated into Owner
Participation Agreement; that the pay back will begin when the project is leased out;
that the Owner Participation Agreement will provide obligations for affordability that
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must be met and the loan would be contingent on meeting those obligations; and, the
market study indicating the need for senior housing in the City will be made available
to Mrs. Leonard.
Mr. Costa added that there would be deed restrictions recorded against the property
relating to age and affordability. Whoever owns the property until the end of the 55 -
year term would have to comply with those restrictions. He emphasized the
developer's financial obligations regardless of whether all the units are leased. He
further advised that their own market studies assured a tremendous demand for
affordable senior housing in the City.
(2) Ken Friess, 31506 Paseo Christina, Executive Director of Mary Erickson Foundation,
stated that their primary concerns were financial because the majority of reserved
funds for affordable housing would be put into this single project if it is approved. He
further noted that the budget for the project indicated that over 30% is financed by
public funds; therefore, there must be strong guarantees that the project will do what
it is intended to do. He stated that the Owner Participation Agreement should define
the rent structure and provide for an audit and enforcement of the affordability
requirements.
Mr. Tomlinson advised that income levels, broken down by county, are defined by
the State and Federal governments and will be included in the proposed Owner
Participation Agreement.
BQ&td MeMer Cgmmols:
Chairman Swerdlin noted his support for the project and inquired about the following; (1)
A variable interest rate; (2) the definition of full occupancy for beginning the loan pay back;
(3) seniors who can no longer live independently; (4) the parking arrangements; (5) the
percentage of units assigned for low-income versus very low-income; and, (6) the affect of
the $1.4 million loan on set-aside funds.
Mr. Scarborough advised that a variable interest rate and a fixed date -certain for occupancy
could be negotiating points. He noted, however, that a variable interest rate was complicated
to administer; the 5% interest rate was close to the Agency's rate of return; and, obtaining a
return on an affordable housing loan was unusual since most affordable housing projects were
funded by grants or no -interest loans. Mr. Costa explained the program for helping residents
find assisted -living housing when they are no longer able to live alone. With regard to
parking, Mr. Costa advised that the goal was a ratio of one parking space per unit. He
advised that many residents will not have cars and he felt this project probably had more
parking than would be needed. Mr. Costa stated that low income restrictions were defined
as up to 80% of median income. Rent calculated at 80% of median income was at market
level today. Kaufman & Broad would restrict all of the units to 60% of median income,
which would meet State and Federal guidelines for certain tax credits. Mr. Scarborough
advised that the Director of Administrative Services had prepared a memorandum dated
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August 17, 1995, forwarding a cash flow projection for Agency funds which indicated the
loan could be feasible even if Depot did not sell.
Director Jones felt the grading and layout were good. He felt there would be no problem
obtaining full occupancy and that the project would be a good economic stimulus for the
Ortega commercial area. He stated he supported the project and had no problem using all
available funds for the proposed loan. Director Hart stated his support of the project as well.
He felt it was well-designed and that the concerns regarding the contractual agreement and
liability would be addressed. He suggested that law enforcement be involved in areas such
as security, safety of individuals, locks, visibility, etc., to provide as much safety to the
residents as possible.
Director Nash stated she was in favor of senior housing, but was hesitant about the proposed
location and the benefit to seniors living there. She cited the following concerns: (1) the
proposed single-family parcel was not appropriate in this zoning; (2) the project was too
dense and without adequate open space, and suggested removal of one building; (3) the
driveway location on Rancho Viejo Road may be problem for the residents; (4) inquired
regarding the height of retaining walls in the interior of project and felt there were an
inadequate number of trees in the project; (5) objected to the 12 -foot retaining wall in front
of the project, and suggested it could be further stepped down to retain views to the east; (6)
the eucalyptus trees on adjacent properties should be protected and preserved; (7) the colors
shown on the rendering were too harsh, and (7) inquired about future ownership of the
project.
Mr. Tomlinson clarified that the placement and two-level construction of the 12 -foot retaining
wall was included for drainage purposes between two properties; when Ortega Properties
developed and graded the area the first level of the wall would not be visible. Mr. Costa
stated that Kauffman & Broad would maintain the project for at least 15 years because of tax
credits; that subsequent owners would have restrictions through the Owner Participation
Agreement; and, that tax credit program financing did not allow for assisted living in the
project.
Director Campbell cited concerns regarding (1) the lack open space and outdoor recreational
amenities; (2) whether the parking should be covered; and, (3) the need to retain the street
trees. Discussion ensued regarding covered parking. Mr. Costa advised that experience had
shown that parking should be either entirely covered or entirely open. He advised that one
reason parking had been left uncovered was due to street views. He advised that in some
projects parking had been replaced with greenscape, with the stipulation that should it be
needed, the area would be returned to parking. Mr. Jones and Mrs. Campbell subsequently
stated opposition to carports. Mr. Costa described the proposed outdoor areas, stating that
there was more open space than may be apparent. He noted that three-story buildings would
allow for additional open space, but the two-story garden -style buildings avoided an
institutional look. He offered to schedule a field trip to similar developments for interested
Board Members.
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Director Hart stated support for the concept of certain parking areas being converted to
greenscape areas, and that it should be left to staff to determine if and when those areas
should be re -converted to parking. He stated he would appreciate viewing other projects.
Chairman Swerdlin also wished to view other projects and stated his concern that open space
should be emphasized. Director Campbell requested a list of similar projects and reiterated
her concern for outdoor space and activities. Mr. Costa advised he would review the
possibility of additional outdoor amenities.
Direction to Prepare Owner Participation Agreement:
There was a consensus of the Board that staff be directed to prepare for fixture consideration,
a draft Owner Participation Agreement that sets forth the specific terms and conditions for
granting assistance to the project.
F.1"1119UNW51M
There being no further business before the Board, the meeting was adjourned at 3:10 p.m. to the next
regular meeting date of Tuesday, May 2, 1995, at 7:00 p.m., in the City Council Chambers.
Respectfully submitted,
CHERYL JO ON GENCY SECRETARY
ATTEST:
VID SWERDLiN, C
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