HomeMy WebLinkAboutED Purchase BMR Housing Unit 2011CITY OF
SAN RAFAEL
AGENDA ITEM NO.: 3 m.
MEETING DATE: August 15, 2011
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN RAFAEL APPROVING THE
ALLOCATION OF AN AMOUNT NOT TO EXCEED TWO HUNDRED AND SEVENTY FIVE
THOUSAND DOLLARS ($275,000) FROM AFFORDABLE HOUSING FUNDS FOR THE
PURCHASE OF A BELOW MARKET RATE HOUSING UNIT AND MAKING FINDINGS AND
APPROVALS PURSUANT TO THE CALIFORNIA REDEVELOPMENT LAW IN CONNECTION
WITH THE UTILIZATION OF AGENCY LOW AND MODERATE INCOME HOUSING FUNDS
OUTSIDE THE CENTRAL SAN RAFAEL REDEVELOPMENT PROJECT AREA.
SUBMITTED BY: .W i ;#e- APPROVED BY -
Stephanie Lovette, Acting Economic Development Director ,,Nancy,Mackle City Manager
RECOMMENDATION: Staff recommends that the City Council approve an allocation from
affordable housing funds in an amount not to exceed $275,000 for the purchase of a Below
Market Rate housing unit located outside the Redevelopment Project Area.
BACKGROUND: The first units in the City's ownership BMR program were sold to qualified
buyers in 1986. The Marin County Housing Authority ("Marin Housing") has been managing
the program on behalf of the County and all of the towns and cities in the County, except Novato,
since that date. There are now 113 BMR ownership units in San Rafael.
The BMR Agreement with the developer of the property provides that each contract conveying a
BMR unit to a buyer include a resale restriction and an option to purchase constituting a right of
first refusal to Marin Housing ("Resale Restriction"). The majority of BMR unit resales occur
between a willing seller and another low or moderate income family that has been qualified by
Marin Housing. In these situations, Marin Housing does not provide funds for the unit
acquisition.
Occasionally, Marin Housing is in the position of exercising the resale option due to the owner's
violation of the Resale Restriction. This type of situation requires Marin Housing to exercise its
option to purchase the unit in order to maintain the unit in the BMR program. In these situations,
Marin Housing either purchases the unit utilizing a loan from the Redevelopment Agency or
assigns its purchase option directly to the Agency.
FOR CITY CLERK ONLY
File N'o.
City Council Meeting: 91, 1
Disposition: i.ti I f
Once Marin Housing obtains title and the subordinate liens are cleared, the unit is resold to on
income -qualified buyer and the funds are returned to the Agency.
ANALYSIS: Staff recommends taking actions to preserve this unit wan affordable ownership
housing resource. This requires Marin Housing exercise its option hm purchase pursuant tothe
Resale Restriction. Marin Housing requires aloan from the City ofSan Rafael tocomplete this
transaction. Once the unit is resold to oqua|ified purcbaemr, the funds will boreturned |othe City
ofSan Rafael.
Normally, the City ofSan Rafael would request the San Rafael Redevelopment Agency to utilize
the Agency's affordable housing fund for this type oftransaction. However, the Redevelopment
Agency iocurrently inhiatus due 10the AB}{I26signed bythe Governor onJune 28`20ll. In
addition, the Agency's affordable housing funds are now held by the City of San Rafael pursuant
unAffordable Housing Grant and Cooperation Agreement dated February 22`Z0ll. 7,hcrufooa^
staff is recommending that the City ofSan Rafael provide the loan toMarin Housing pursuant to
the Affordable Housing Grant and Cooperation Agreement.
The California Redevelopment Law, Health and Safety Code Section 33334.2W.requires that
the City Council make findings and approve the Agency's use of |ovv and moderate income
housing funds when the funds will beused ooprojects |oCatedoutmidcof1hcCcnho San Rafael
Redevelopment Project /\rou. Staff believes this requirement is in effect during the Agency's
hiatus period.
FISCAL IMPACT: No fiscal impact to the City of San Rafael General Fund, the $275,00
allocation will bufunded from the Redevelopment Agency's Low and Moderate Income Housing
ACTION REQUIRED: Adopt the attached resolution.
RESOLUTION NO. 13222
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN RAFAEL APPROVING THE
ALLOCATION OF AN AMOUNT NOT TO EXCEED TWO HUNDRED AND SEVENTY FIVE
THOUSAND DOLLARS ($275,000) FROM AFFORDABLE HOUSING FUNDS FOR THE
PURCHASE OF A BELOW MARKET RATE HOUSING UNIT AND MAKING FINDINGS AND
APPROVALS PURSUANT TO THE CALIFORNIA REDEVELOPMENT LAW IN
CONNECTION WITH THE UTILIZATION OF AGENCY LOW AND MODERATE INCOME
HOUSING FUNDS OUTSIDE THE CENTRAL SAN RAFAEL REDEVELOPMENT PROJECT
AREA
WHEREAS, the City Council (the "City Council") of the City of San Rafael (the "City")
has adopted and amended, from time to time, the Redevelopment Plan (the "Redevelopment
Plan") for the Central San Rafael Redevelopment Project Area (the "Project Area"); and
WHEREAS, the Redevelopment Agency of the City of San Rafael (the "Agency") is
responsible for administering the Redevelopment Plan to cause redevelopment of the Project
Area, including the provision of housing available at affordable housing cost to low and
moderate income households; and
WHEREAS, The City of San Rafael General Plan Policy H-19 requires a portion of the
units in residential projects include units affordable to low and moderate income households; and
WHEREAS, the City of San Rafael has contracted with the Marin Housing Authority
("Marin Housing") to administer a Below Market Rate Home Ownership Program ("BMR
Program"); and
WHEREAS, as required by the BMR Program, an owner entered into a resale restriction
and an option to purchase constituting a right of first refusal to Marin Housing ("Resale
Restriction") in 2002; and
WHEREAS, Marin Housing desires to exercise its option to purchase a Below Market
Rate unit pursuant to the Resale Restriction, due to an option event as defined in the Resale
Restriction thereby maintaining the property as an affordable housing resource; and
WHEREAS, the City of San Rafael desires that the property remain in the affordable
housing program; and
WHEREAS, Marin Housing requires funding in an amount of Two Hundred and Seventy
Five Thousand Dollars ($275,000) to pay the restricted resale price of the unit and other costs
associated with the resale of the unit to another qualified buyer; and
WHEREAS, the City of San Rafael desires these funds be paid from a funding source
outside of the City's General Fund; and
WHEREAS, on February 22, 2011 the City of San Rafael and the San Rafael
Redevelopment Agency entered into an Affordable Housing Grant and Cooperation Agreement
pursuant to Resolution 13114 of the San Rafael City Council and all of the Redevelopment
Agency's affordable housing funds were transferred to the City of San Rafael; and
WHEREAS, the City of San Rafael desires to allocate Two Hundred and Seventy Five
Thousand Dollars ($275,000) from the Affordable Housing Grant Fund for the purchase of this
unit; and
WHEREAS, Health and Safety Code Section 33334.2(g) authorizes expenditure of
Housing Fund monies outside the Redevelopment Project Area upon a finding by the City
Council that such use will be of benefit to the Project Area; and
WHEREAS, the transaction will benefit the Project Area and serve major Redevelopment
Plan goals and objectives by maintaining housing available at affordable cost in the community,
thereby decreasing the market pressure on the supply of affordable housing in the community and
the Project Area; and
WHEREAS, The California Environmental Quality Act (Public Resources Code Section
21000 et �Leq s .) ("CEQA") imposes no conditions on the City's consideration and approval of this
Agreement, because the project undertaken pursuant to this Agreement is an acquisition of
existing improvements and such projects are exempt from CEQA requirements under the
categorical exemption set forth in 14 CCR Section 15301; and
WHEREAS, by staff report accompanying this Resolution and incorporated into this
Resolution by this reference (the "Staff Report"), the City Council has been provided with
additional information upon which the findings and actions set forth in this Resolution are based.
NOW, THEREFORE, BE IT RESOLVED that the City Council hereby finds and
determines that the above recitals are true and correct and have served as the basis, in part, for the
findings and actions of the City Council set forth below.
BE IT FURTHER RESOLVED that, based on information and analysis set forth in the
above Recitals and contained in the Staff Report accompanying this Resolution, the City Council
hereby finds and determines pursuant to Health and Safety Code Section 33334.2(g) that the use
of moneys from the Housing Fund to assist in the preservation of this affordable housing unit
will be of benefit to the Project Area and the program of redevelopment pursuant to the
Redevelopment Plan,
BE IT FURTHER RESOLVED that the City Council hereby approves allocation of Two
Hundred and Seventy Five Thousand Dollars ($275,000) of Affordable Housing Grant Fund
monies to fund a loan to Marin Housing, or in the alternative, to fund the direct purchase of the
below market rate property.
BE IT FURTHER RESOLVED that this Resolution shall take immediate effect upon
adoption.
1, ESTHER BEIRNE, City Clerk of the City of San Rafael, hereby certify that the foregoing
resolution was duly and regularly introduced and adopted at a regular meeting of the City
Council held on the 15`h day of August 2011, by the following vote, to wit:
AYES:
COUNCILMEMBERS:
NOES:
COUNCILMEMBERS:
ABSENT:
COUNCILMEMBERS:
Brockbank, Connolly, Heller, Levine & Mayor Boro
None
None
Esther Beirne, City Clerk
INSTRUCTIONS:
112--alfliv,
DEPARTMENT
CITY OF SAN RAFAEL
USE THIS FORM WITH EACH SUBMITTAL OF A CONTRACT, AGREEMENT,
ORDINANCE OR RESOLUTION BEFORE APPROVAL BY COUNCIL / AGENCY.
Stephanie Lovette
Economic Development_
SRRA / SRCC AGENDA ITEM NO. ' tl ,
DATE OF MEEIP*
AUG) 210,111
L - 11 11
TITLE OF DOCUMENT: RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN RAFAEL
APPROVING THE ALLOCATION OF AN AMOUNT NOT TO EXCEED TWO HUNDRED AND SEVENTY
FIVE THOUSAND DOLLARS ($275,000) FROM AFFORDABLE HOUSING FUNDS FOR THE PURCHASE
OF A BELOW MARKET RATE HOUSING UNIT AND MAKING FINDINGS AND APPROVALS
PURSUANT TO THE CALIFORNIA REDEVELOPMENT LAW IN CONNECTION WITH THE
UTILIZATION OF AGENCY LOW AND MODERATE INCOME HOUSING FUNDS OUTSIDE THE
CENTRAL SAN RAFAEL REDEVELOPMENT PROJECT AREA
Departhent Head (signature)
(LOWER HALF OF FORM FOR APPROVALS ONLY)
APPROVED AS COUNCIL AGENCY
AGENDA ITEM:
Cit},.'Monager (signatu
REMARKS:
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City Attorney (signature)
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