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HomeMy WebLinkAbout10-15-2019 Item 7 Report Affordable Housing Density Bonus C Avenue 8 Plex 1821 C AvenueCITY OF NATIONAL CITY, CALIFORNIA COUNCIL AGENDA STATEMENT MEETING DATE: October 15, 2019 (7201- yo/ AGENDA ITEM NO. 7 f EM TITLE: Resolution of the City Council of the City of National City approving an Affordable Housing Density Bonus Agreement with C Avenue 8 Plex LLC, for the development of 10 units located at 1821 "C" Avenue and restricting the rent and occupancy of one (1) unit to a low income household in exchange for a density bonus pursuant to California Government Code Sections 65915 - 65918. PREPARED BY: Greg Rose, Property Agent PHONE: 619-336-4266 APPROVED BY: EXPLANATION: C Avenue 8PIex LLC (Developer) wants to develop their property located at 1821 "C" Avenue. Current zoning allows for the construction of 8 units by right. The Developer will restrict the rent and occupancy of one (1) unit to a low income household (below 80% of area median income) in exchange for a density bonus of 23% mandated by California Government Code Sections 65915 — 65918, which will allow the construction of an additional 2 units for a total of 10 units on the property. The Affordable Density Housing Bonus Agreement ("Agreement") will serve to memorialize the Developer's obligation to provide the one (1) affordable unit and the restriction of the affordable unit by the recordation of this agreement assuring affordability for a total of fifty-five (55) years. A Performance Deed of Trust will also be recorded to secure the Agreement on the property. See Background Report for information on the DEPARTMENT: Housing Authority INANCIAL STATEMENT: ACCOUNT NO. N/A APPROVED: Finance APPROVED: MIS ENVIRONMENTAL REVIEW: The Density Bonus Agreement is not considered a project as defined by the California Environmental Quality Act (CEQA), and is therefore not subject to CEQA. ORDINANCE: INTRODUCTION: FINAL ADOPTION: STAFF RECOMMENDATION: Adopt the Resolution. BOARD / COMMISSION RECOMMENDATION: N/A ATTACHMENTS: 1. Background Report and Site Plan 2. Affordable Housing Density Bonus Agreement 3. Performance Deed of Trust 4. Resolution RESOLUTION NO. 2019 - 140 RESOLUTION OF CITY COUNCIL OF THE CITY OF NATIONAL CITY APPROVING AN AFFORDABLE HOUSING DENSITY BONUS AGREEMENT WITH C AVENUE 8 FLEX, LLC, FOR THE DEVELOPMENT OF 10 UNITS LOCATED AT 1821 "C" AVENUE AND RESTRICTING THE RENT AND OCCUPANCY OF ONE (1) UNIT TO A LOW INCOME HOUSEHOLD IN EXCHANGE FOR A DENSITY BONUS PURSUANT TO CALIFORNIA GOVERNMENT CODE SECTIONS 65915 - 65918 WHEREAS, C Avenue 8 Plex, LLC ("Developer") is the owner of that certain real property generally located at 1821 "C" Avenue ("Property"), in the City of National City, County of San Diego; and WHEREAS, the General Plan and Zoning Ordinance of the City of National City permit no more than eight (8) housing units on the Property; and WHEREAS, Developer proposes to develop a total of ten (10) housing units on the Property ("Development"); and WHEREAS, pursuant to Government Code Section 65915, and Sections 18.48.030, et seq. of the National City Municipal Code, the Developer has proposed to construct and restrict the rent and occupancy of one (1) residential dwelling unit ("Affordable Unit") to a low-income household in exchange for a density bonus ("Density Bonus") which will allow the construction of the ten (10)-unit Development on the Property; and WHEREAS, in addition to the Density Bonus, the Developer is entitled to receive incentives and concessions as set forth in Government Code Section 65915 and the Developer has independently and of its own free will chosen not to receive any such incentives or concessions; and WHEREAS, the Affordable Housing Density Bonus Agreement ("Agreement") will serve to memorialize Developer's obligation to provide the one (1) Affordable Unit including the time frame for the construction and occupancy of the Affordable Unit and the restriction of the Affordable Unit by the recordation of the Agreement assuring affordability for a total of fifty-five (55) years measured from the issuance of final inspection approval for the Development; and WHEREAS, a Performance Deed of Trust will also be recorded for the purpose of securing the timely performance of the Agreement and the performance of each agreement contained in the Performance Deed of Trust. NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of National City, approves the Affordable Housing Density Bonus Agreement with C Avenue 8 Plex, LLC, for the development of 10 units located at 1821 "C" Avenue and restricting the rent and occupancy of one (1) unit to a low income household in exchange for a density bonus as mandated by California Government Code Sections 65915 - 65918. After being recorded by the County of San Diego, a copy of said Agreement will be on file in the Office of the City Clerk, Resolution No. 2019 — 140 Page Two BE IT FURTHER RESOLVED that City Council of the City of National City will record a Performance Deed of Trust securing the timely performance of the Affordable Housing Density Bonus Agreement. After being recorded by the County of San Diego, a copy of said Deed of Trust will be on file in the'Office of the City Clerk. PASSED and ADOPTED this 15th of October, Ale So elo-Solis, Mayor ATTEST: rr N �tiV�`- Mic ael R. D a, City Clerk APPROVED AS TO FORM: Passed and adopted by the Council of the City of National City, California, on October 15, 2019 by the following vote, to -wit: Ayes: Councilmembers Cano, Morrison, Quintero, Rios, Sotelo-Solis. Nays: None. Absent: None. Abstain: None. AUTHENTICATED BY: ALEJANDRA SOTELO-SOLIS Mayor of the City of National City, California MICHAEL R. DALLA City Clerk of the City of National City, California By: Deputy I HEREBY CERTIFY that the above and foregoing is a full, true and correct copy of RESOLUTION NO. 2019-140 of the City of National City, California, passed and adopted by the Council of said City on October 15, 2019. City CI I City, California rk of the City of Na iona By: Deputy No Fees per Government Code 6103 Recording Requested By: National City Community Development Commission When Recorded Mail To: National City Community Development Commission Attention: Executive Director 1243 National City Boulevard National City, CA 91950 DOC# 2019-0506412 I IIIIII IIIII II II IIIII IIII IIIIII IIIII IIIII II II IIIII IIIII IIIII IIII IIII Nov 05, 2019 10:09 AM OFFICIAL RECORDS Ernest J. Dronenburg, Jr., SAN DIEGO COUNTY RECORDER FEES: $0.00 (SB2 Atkins: $0.00) PAGES: 9 DEED OF TRUST (1821 C Avenue -Density Bonus Agreement) THIS DEED OF TRUST is dated as of thetWiLday of S Sit; 2019, between C " Avenue 8P1ex LLC, a California limited liability company ("Trustor), whose address is 2801 B Street #70, San Diego 92102, Lawyers Title Company ("Trustee"), and the City of National City ("Beneficiary"), whose address is 1243 National City Boulevard, National City, California 91950. TRUSTOR HEREBY irrevocably grants, transfers, and assigns to Trustee, in trust, with power of sale, all that property in the City of National City, County of San Diego, State of California, described as ("Property"): (See Legal Description - Exhibit "A") FOR THE PURPOSE OF SECURING: (1) The timely performance of the Affordable Housing Density Bonus Agreement of even date herewith ("Agreement"), between the Beneficiary and the Trustor, and any renewals, extensions, modifications or amendments to the Agreement by the Trustor and each and every covenant set forth herein; and (2) The performance of each agreement contained in this Deed of Trust. A. TO PROTECT THE SECURITY OF THIS DEED OF TRUST, TRUSTOR AGREES: 1. Defense of Security. To appear in and defend any action or proceeding purporting to affect the security of this Deed of Trust or the rights or powers of Beneficiary or Trustee; and to pay all costs and expenses, including cost of evidence of title and attorneys' fees in a reasonable 1 sum, in any such action or proceeding in which Beneficiary or Trustee may appear, and in any suit brought by Beneficiary to foreclose on this Deed of Trust. 2. Payment of Liens and Taxes. To pay, at least ten (10) days before delinquency, all taxes and assessments affecting the Property, including assessments on appurtenant water stock, all encumbrances, charges, and liens, with interest, on the Property or any part of the Property, which appear to be prior or superior to this Deed of Trust, and all costs, fees, and expenses of this Deed of Trust. If Trustor fails to make any payment or to do any act as provided in this Deed of Trust, then Beneficiary or Trustee may (but is not obligated to) make the payment or do the act in the required manner and to the extent deemed necessary by Beneficiary or Trustee to protect the security of this Deed of Trust. The performance by Beneficiary or Trustee of such an act shall not require notice to or demand upon Trustor and shall not release Trustor from any obligation under this Deed of Trust. Beneficiary or Trustee shall also have the following related rights and powers: to enter upon the Property for the foregoing purposes; to appear in and defend any action or proceeding purporting to affect the security of this Deed of Trust or the rights or powers of Beneficiary or Trustee; to pay, purchase, contest, or compromise any encumbrance, charge, or lien that in the judgment of either appears to be prior or superior to this Deed of Trust; to employ counsel; and to pay necessary expenses and costs, including attorneys' fees. 3. Reimbursement of Costs. To pay immediately and without demand all sums expended by Beneficiary or Trustee pursuant to this Deed of Trust, with interest from date of expenditure at the amount allowed by law in effect at the date of this Deed of Trust, and to pay any reasonable amount demanded by Beneficiary (up to the maximum allowed by law at the time of the demand) for any statement regarding the obligation secured by this Deed of Trust. 4. Use. That it will not permit or suffer the use of any of the Property for any purpose other than the use for which the same was intended at the time this Deed of Trust was executed. 5. Incorporation of Agreement. That the Agreement is incorporated herein by reference and made a part of this Deed of Trust. 6. Performance of Other Obligations. To perform, in a timely manner, each agreement and covenant by and between Trustor on any and all notes, loans and deeds of trust that are senior and/or junior to this Deed of Trust. A default in any of these obligations, beyond any applicable cure period, shall constitute a default under this Deed of Trust. B. THE PARTIES AGREE THAT: 7. Waiver of Late Payments. By accepting payment of any sum secured by this Deed of Trust after its due date, Beneficiary does not waive its right either to require prompt payment when due of all other sums so secured or to declare default for failure to pay any indebtedness secured by this Deed of Trust. 2 8. Full Reconveyance. Upon expiration of the term of the Agreement and written request of Beneficiary, and payment of Trustee's fees and charges, Trustee shall reconvey, without warranty, the Property then subject to this Deed of Trust. The recitals in the reconveyance shall be conclusive proof of the truthfulness of the recitals. The grantee in the reconveyance may be described as "the person or persons legally entitled thereto." 9. Assignment of Rents. As additional security, Trustor hereby gives to and confers upon Beneficiary the right, power, and authority during the continuance of -this Deed of Trust, to collect the rents, issues, and profits of the Property, but reserves the right, prior to any default by Trustor in payment of any indebtedness secured by this Deed of Trust or in the performance of any agreement under this Deed of Trust, to collect and retain these rents, issues, and profits as they become due and payable. Upon any such default beyond any applicable, cure period, Beneficiary may, without notice and without regard to the adequacy of the security for the indebtedness secured by this Deed of Trust, either personally or by agent or court -appointed receiver, do the following: enter upon and take possession of the Property or any part of the Property; sue for or otherwise collect all rents, issues, and profits, including those past due and unpaid; and apply these rents, issues, and profits, less costs and expenses of operation and collection (including reasonable attorneys' fees), upon any indebtedness secured by this Deed of Trust, in any order determined by Beneficiary. The exercise of the foregoing rights by Beneficiary shall not cure or waive any default or notice of default under this Deed of Trust or invalidate any act done pursuant to such a notice. 10. Default and Foreclosure. Upon default under the Agreement, subject to any applicable notice and cure rights contained in the Agreement, or in the performance of any obligation under this Deed of Trust beyond any applicable cure period, Beneficiary may declare all obligations secured by this Deed of Trust immediately due and payable by delivering to Trustee a written declaration of default and demand for sale and a written notice of default and election to sell the Property. Trustee shall cause the notice of default and election to sell to be recorded. After the required time period has lapsed following the recordation of the notice of default, and after notice of sale has been given as required by law, Trustee, without demand on Trustor, shall sell the Property at the time and place specified in the notice of sale, either as a whole or in separate parcels, and in any order determined by Trustee, at public auction to the highest bidder for cash in lawful money of the United States, payable at the time of sale. Trustee may postpone sale of all or any portion of the Property by public announcement at the time and place of sale, and from time to time thereafter may postpone the sale by public announcement at the time fixed by the preceding postponement. Trustee shall deliver to the purchaser at the auction its deed conveying the Property sold, but without any covenant or warranty, express or implied. The recital in the deed of any matter or fact shall be conclusive proof of the truthfulness of the recital. Any person, including Trustor, Trustee, or Beneficiary, may purchase at the sale. After deducting all costs, fees, and expenses of Trustee and Beneficiary under this paragraph, including costs of procuring evidence of title incurred in connection with sale, Trustee shall apply the proceeds of sale to payment of: all suns expended under the terms of this Deed of Trust, not then repaid, with accrued interest at the amount allowed by law in effect at the date of this Deed of Trust; all other sums then secured by this Deed of Trust; and the remainder, if any, to the person or persons legally entitled to the retraining proceeds. 3 11. Due on Sale or Further Encumbrance. Trustor shall not sell, transfer or otherwise dispose of the real property described in this deed of trust, or any portion thereof, or any interest therein unless the proposed transferee shall have executed and delivered to the Beneficiary an express written assumption of all of Trustor's obligations hereunder this deed of trust, 'on a form reasonably acceptable to the Beneficiary. Consent to one transaction of this type will not constitute a waiver of the right to acquire consent to future or successive transactions. 12. General Provisions. This Deed of Trust applies to, inures to the benefit of, and binds all parties to this Deed of Trust and their heirs, legatees, devisees, administrators, executors, successors, and assigns. The term "Beneficiary" shall mean the City of National City, and its successors and assigns. In this Deed of Trust, whenever the context so requires, the masculine gender includes the feminine and/or neuter, and the singular number includes the plural. 13. Substitution of Trustees. Beneficiary, or any successor in ownership of any obligations secured by this Deed of Trust, may from time to time, by written instrument, substitute a successor or successors to any Trustee named in or acting under this Deed of Trust. The substitution instrument shall contain the name of the original Trustor, Trustee, and Beneficiary under this Deed of Trust, the book and page where this Deed is recorded, and the name and address of the new Trustee. When executed by Beneficiary and duly acknowledged and recorded in the office of the recorder of the county or counties where the Property is situated, the substitution instrument shall be conclusive proof of proper substitution of the successor Trustee or Trustees. Any successor Trustee or Trustees shall; without conveyance from the Trustee predecessor, succeed to all its title, estate, rights, powers, and duties. 14. Cumulative Powers and Remedies. The powers and remedies conferred in this Deed of Trust are concurrent and cumulative to all other rights and remedies provided in this Deed of Trust or given by law. These powers and remedies may be exercised singly, successively, or together, and as often as deemed necessary. 15. Conclusiveness of Recitals. The recitals contained in any reconveyance, trustee's deed, or any other instrument executed by the Trustee from time to time under the authority of this Deed of Trust or in the exercise of its powers or the performance of its duties under this Deed of Trust, shall be conclusive evidence of their truth, whether stated as specific and particular facts, or in general statements or conclusions absent manifest error. Further, the recitals shall be binding and conclusive upon the Trustor, its heirs, executors, administrators, successors, and assigns, and all other persons. 16. Attorneys' Fees. If any action is brought for the foreclosure of this Deed of Trust or for the enforcement of any provision of this Deed of Trust (whether or not suit is filed), Trustor agrees to pay all costs and expenses of Beneficiary and Trustee, including reasonable attorneys' fees; and these sums shall be secured by this Deed of Trust. The prevailing party in any litigation, including but not limited to arbitration, writ petitions, complaints, and/or actions for declaratory relief, brought to enforce, interpret or reform the provisions of this Deed of Trust shall be entitled to reasonable attorneys' and experts' fees, costs and out-of-pocket expenses (whether or not considered recoverable "costs" under applicable statute) incurred in such litigation. 4 17. Request for Notices of Default and Sale. In accordance with Section 2924b of the California Civil Code, request is hereby made that a copy of any Notice of Default and a copy of any Notice of Sale under that Deed of Trust executed by the Trustor concerning this Property be mailed to: City of National City Attention: Executive Director 1243 National City Boulevard National City, CA 91950 NOTICE: A copy of any notice of default and of any notice of sale will be sent only to the address contained in this recorded request. If your address changes, a new request must be recorded. 18. Inspections. Trustor shall permit Beneficiary and its agents or representatives, to inspect the Property at any and all reasonable times, upon 48 hours advance notice to Trustor. Inspections shall be conducted so as not to interfere with the tenants' use and enjoyment of the Property. 19. Hazardous Materials Defined. For purposes of this Deed of Trust, "Hazardous Materials" means and includes any flammable, explosive, or radioactive materials or hazardous, toxic or dangerous wastes, substances or related materials or any other chemicals, materials or substances, exposure to which is prohibited, limited or regulated by any federal, state, county, regional or local authority or which, even if not so regulated, may or could pose a hazard to the health and safety of the occupants of the Property or of property adjacent to the Property, including, but not limited to, asbestos, PCBs, petroleum products and byproducts, substances defined or listed as "hazardous substances" or "toxic substances" or similarly identified in, pursuant to, or for purposes of, the California Solid Waste Management, Resource Recovery and Recycling Act (California Government Code Section 66700 et sue.), the Comprehensive Environmental Response, Compensation, and Liability Act, as amended (42 U.S.C. Section 9601, et sec.), the Hazardous Materials Transportation Act (49 U.S.C. Section 1801, et seg.), the Resource Conservation and Recovery act (42 U.S.C. Section 6901, et sg.), Section 25117 or Section 25316 of the California Health & Safety Code; and any so-called "Superfund" or "Superlien" law, or any other federal, state or local statute, law, ordinance, code, rule, regulation, order or decree regulating, relating to or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance or material; or any substances or mixture regulated under the Toxic Substance Control Act of 1976, as now or hereafter amended (15 U.S.C. Section 2601 et se .); and any "toxic pollutant" under the Clean Water Act, as now or hereafter amended (33 U.S.C. Section 1251 et seq.); and any hazardous air pollutant under the Clean Air Act, as now or hereafter amended (42 U.S.C. Section 7901 et seq.). Notwithstanding the above, the term "Hazardous Materials" shall not include small amounts of chemicals, cleaning agents and the like commonly employed in routine household uses in a manner typical of occupants in other similar residential properties provided they are used in compliance with applicable laws. The tenn "Hazardous Materials Laws" means any federal, state or local law, code, statute, ordinance, rule, regulation, rule of common law or guideline relating to Hazardous 5 Materials now or hereafter enacted or promulgated (collectively, and including, without limitation, any such laws which require notice of the use, presence, storage, generation, disposal or release of any Hazardous Materials to be provided to any party). 20. Trustor's Hazardous Materials Representations and Warranties and Indemnity. In addition to the general and specific representations, covenants and warranties set forth in the Deed of Trust or otherwise, Trustor represents, covenants and warrants, with respect to Hazardous Materials, as follows: (a) Neither Trustor nor, to the best knowledge of Trustor, any other person, has ever caused or permitted any Hazardous Materials to be manufactured, placed, held, located or disposed of on, under or at the Property or any part thereof, and neither the Property nor any part thereof, or any property adjacent thereto, has ever been used (whether by the Trustor or, to.the best knowledge of the Trustor, by any other person) as a manufacturing site, dump site or storage site (whether permanent or temporary) for any Hazardous Materials; (b) Trustor hereby agrees to indemnify Beneficiary, its officers, employees, contractors and agents, and hold Beneficiary, its officers, employees, contractors and agents harmless from and against any and all losses, liabilities, damages, injuries, costs, expenses and claims of any and every kind whatsoever paid, incurred or suffered by, or asserted against Beneficiary, its officers, employees, contractors and agents for, with respect to, or as a direct or indirect result of, the presence or use, generation, storage, release, threatened release or disposal of Hazardous Materials on or under the Property or the escape, seepage, leakage, spillage, discharge, emission or release of any Hazardous Materials from the Property (including, without limitation, any losses, liabilities, damages, injuries, costs, expenses or claims asserted or arising under CERCLA, any so-called "Superfund" or "Superlien" law, or any other federal, state or local statute, law, ordinance, code, rule, regulation, order or decree regulating, relating to or imposing liability or standards of conduct concerning any Hazardous Materials) regardless of whether or not caused by or within the control of Trustor, except to the extent arising as a result of the negligence or willful misconduct of Beneficiary. (c) Trustor has not received any notice of (i) the happening of any event involving the use, spillage, discharge, or cleanup of any Hazardous Materials ("Hazardous Discharge") affecting Trustor or the Property or (ii) any complaint, order, citation or notice with regard to air emissions, water discharges, noise emissions or any other environmental, health or safety matter affecting Trustor or the Property ("Environmental Complaint") from any person or entity, including, without limitation, the United States Environmental Protection Agency ("EPA"). If Trustor receives any such notice after the date hereof, then Trustor will give, within seven (7) business days thereafter, oral and written notice of same to Beneficiary. (d) Without limitation of Beneficiary's rights under this Deed of Trust, Beneficiary shall have the right, but not the obligation, to enter onto the Property or to take such other actions as it deems necessary or advisable to clean up, 'remove, resolve or minimize the impact of, or otherwise deal with, any such Hazardous Materials or Environmental Complaint upon its receipt of any notice from any person or entity, including without limitation, the EPA, asserting the existence of any Hazardous Materials or an Environmental Complaint on or pertaining to the 6 Property which, if true, could result in an order, suit or other action against Trustor affecting any part of the Property by any governmental agency or otherwise which, in the sole opinion of Beneficiary, could jeopardize its security under this Deed of Trust. All reasonable costs and expenses incurred by Beneficiary in the exercise of any such rights shall be secured by this Deed of Trust and shall be payable by Trustor upon demand together with interest thereon at a rate equal to the highest rate payable by law. (e) The 'foregoing representation, covenants, indemnities and warranties shall be continuing and shall be true and correct for the period from the date hereof to the release of this Deed of Trust (whether by satisfaction of the obligations secured hereby or foreclosure or action in lieu thereof), and these representations, covenants, indemnities and warranties shall survive such release. 21. Authority to Sian. All individuals signing this Deed of Trust for a party which is a corporation, limited liability company, partnership or other legal entity, or signing under a power of attorney, or as a trustee, guardian, conservator, or in any other legal capacity, covenant to the Beneficiary that they have the necessary capacity and authority to act for, sign and bind the respective entity or principal on whose behalf they are signing. TRUSTOR: C Avenue 8 PlexLLC, a California limited liability company By: Keith Robinsoh, Manager 7 ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate Is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of San Diego On SEPTEMBER 25TH , 2019, before me, JIMMIE K. LEW , notary public, personally appeared KEITH ROBINSON who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY undet the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature�/e �/�+- jam— (Seal) JIMMIE K. LEW COMM. #2224385 z Notary Public • California o San Diego County Comm. fires Dec. 7, 2021 t 8 Exhibit "A" Legal Description That certain real property located in the City of National City, County of San Diego, State of California more particularly described as follows: Parcels 1, 2, 3 and 4 of Parcel Map No. 21545, in the City of National City, County of San Diego, State of Califomia, according to map thereof filed in the office of the County Recorder of said County. Assessor's Parcel Number: 560-222-38-00, 560-222-39-00, 560-222-40-00, 560-222-41-00. (underlying APN: 560-222-35-00, 560-222-36-00, 560-222-37-00) 9