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HomeMy WebLinkAbout2011 03-29 CC CDC ADJ AGENDA PKT--' 18`8 7 � Fry AGENDA OF AN ADJOURNED REGULAR MEETING CITY COUNCIL OF THE CITY OF NATIONAL CITY AND THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY COUNCIL CHAMBERS 1243 NATIONAL CITY BOULEVARD NATIONAL CITY, CALIFORNIA ADJOURNED REGULAR MEETING - TUESDAY, MARCH 29, 2011 — 6:00 P.M. OPEN TO THE PUBLIC ROLL CALL PUBLIC ORAL COMMUNICATIONS (Three -Minute Time Limit) CITY COUNCIL NON CONSENT RESOLUTION 1. Resolution of the City Council of the City of National City in opposition to the Governor's proposal to abolish Redevelopment Agencies in California. (City Manager) COMMUNITY DEVELOPMENT COMMISSION PUBLIC HEARING 2. Public Hearing — Five -Year Implementation Plan for the National City Redevelopment Project Area. (Community Development) **Companion Item #3** NON CONSENT RESOLUTIONS 3. Resolution of the Community Development Commission of the City of National City (CDC) approving the Five -Year Implementation Plan (FY 2009-2010 through FY 2013-2014) for the National City Redevelopment Project. (Community Development) **Companion Item #2** 4. Resolution of the Community Development Commission of the City of National City (CDC) authorizing the sale of GNMA Certificates securing the CDC's Multifamily Housing Revenue Bonds (GNMA Collateralized — Park Villas Apartments) 1996 Series A and Series A-T, and the use of the proceeds from the sale thereof to redeem all bonds and to pay transaction costs related thereto; and delegating to the Executive Director the power to take all such actions as are necessary or appropriate to accomplish the foregoing. (City Manager) CLOSED SESSION CITY COUNCIL 5. Conference with Labor Negotiators: Government Code Section 54657.6 Agency Designated Representatives: Stacey Stevenson, Claudia Silva, Eddie Kreisberg, Brad Raulston, and Jeannette Ladrido Employee Organization: Fire Fighters Association ADJOURNMENT Next Regular City Council/Community Development Commission Meeting — Tuesday, April 5, 2011, 6:00 p.m., Council Chambers, Civic Center Council Requests That All Cell Phones And Pagers Be Turned Off During City Council Meetings COPIES OF THE CITY COUNCIL OR COMMUNITY DEVELOPMENT COMMISSION MEETING AGENDAS AND MINUTES MAY BE OBTAINED THROUGH OUR WEBSITE AT www.natlonalcityca.gov ITEM #1 3/29/11 RESOLUTION NO. 2011 — 70 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NATIONAL CITY IN OPPOSITION TO THE GOVERNOR'S PROPOSAL TO ABOLISH REDEVELOPMENT AGENCIES IN CALIFORNIA WHEREAS, as part of the California Fiscal Year 2011-12 budget proposal, the Governor has proposed permanently abolishing California's more than 400 local redevelopment agencies; and WHEREAS, this proposal represents more of the same misguided and illegal State budget raids of local government funds that voters have repeatedly sought to end, most recently in November 2010, when an overwhelming 61% of voters elected to enact Proposition 22 and stop State raids of local government funds, including redevelopment funds; and WHEREAS, this proposal will bring very little financial benefit to the State. According to the State Controller's Office, redevelopment agencies have more than $87 billion , in bond and other contractual obligations that legally must be repaid before revenues are available for any other purpose. In fact, according to the State Department of Finance's own budget documents, there will be zero State savings in out years from shutting down redevelopment; and WHEREAS, because of redevelopment efforts, the City of National City has been able to provide more than 2,515 permanent jobs, and an economy that produces more than $13 million annually in sales and hotel tax; and WHEREAS, the $13 million in tax revenues go directly into the City's General Fund to pay for services such as police, fire, parks and libraries in National City y; and WHEREAS, this proposal will destroy local economic development, including hundreds of thousands of jobs and billions of dollars in local economic activity throughout California. Abolishing redevelopment in National City may destroy: 1. The City of National City's ability to create affordable housing; pay for critical infrastructure such as roads, bridges, and community facilities; and end fundamental services that the residents of National City have relied on for 41 years. 2. The planned 22-acre addition to the award -winning Marina Gateway project, planned to generate $2.6 million annually in benefits to the City and the Unified Port of San Diego, create approximately 300-500 jobs, and rectify environmental and economic injustices in an near National City's Harbor District. 3. The planned implementation of the Westside Specific Plan, which has the potential to create 2,682 work force and affordable housing units, to create 1,672 construction and permanent jobs, according to the Environmental Impact Report for the 2011 Update to the National City General Plan, would perpetuate the environmental injustices caused by blighting influences and incompatible land uses, and prohibit sustainable regional growth. 4. The planned implementation of the Downtown Specific Plan, which would create 4,007 housing units and 3.87 million square feet of mixed -use commercial, office, and institutional space; create 2,627 construction and permanent jobs, according to the Resolution No. 2011 — 70 Page 2 5. Environmental Impact Report for the 2011 Update to the National City General Plan; and prohibit sustainable infill urban development. 6. Remediation and redevelopment of an estimated 100 or more parcels contaminated by hazardous materials, posing health and safety hazards to humans and wildlife; and WHEREAS, throughout California, redevelopment activities support 304,000 jobs annually, including 170,600 construction jobs, contribute over $40 billion annually to California's economy in the generation of goods and services, and generate more than $2 billion in state and local taxes in a typical year; and WHEREAS, eliminating redevelopment will take away, one of the few tools local governments have to comply with State requirements to plan for more compact urban development supported by transit -oriented development, housing, jobs, and infrastructure; and WHEREAS, eliminating redevelopment will destroy the development of affordable housing in California. Redevelopment agencies are the second largest funder of affordable housing, behind only the federal government, and are responsible for over 98,000 units of affordable housing since 1993; and WHEREAS, shutting down redevelopment agencies is a violation of multiple State and federal constitutional provisions. NOW, THEREFORE, BE IT RESOLVED that the City Council of the City Of National City hereby formally opposes the California Administration's proposal to abolish redevelopment in California. BE IT FURTHER RESOLVED that the City of National City authorizes the City Council and City staff to communicate its opposition to this proposal to the Governor, the Legislature, business groups, and citizens. PASSED and ADOPTED this 29th day of March, 2011. Ron Morrison, Mayor ATTEST: Michael R. Dalla, City Clerk APPROVED AS TO FORM: Claudia G. Silva City Attorney CITY OF NATIONAL CITY, CALIFORNIA COMMUNITY DEVELOPMENT COMMISSION AGENDA STATEMENT MEETING DATE: March 29, 2011! AGENDA ITEM NO.Z ITEM TITLE: Public Hearing — Five -Year Implementation Plan for the National City Redevelopment Project Area.: PREPARED BY: Raymond Pe, DEPARTMENT: Co nit Development PHONE: 336-4421 APPROVED BY: EXPLANATION: Pursuant to Community Redevelopment Law, the Commission is required to adopt an implementation plan every five years with specific goals and objectives for the project area; specific programs, potential projects, and estimated expenditures; and an explanation of how the goals and objectives, programs, and expenditures will eliminate blight and implement the requirements of the Law. The Implementation Plan includes projects expected to be undertaken during the five-year planning period. The proposed projects coincide with the proposed capital improvement program. The Law clarifies that the adoption of an implementation plan does not constitute an approval of any specific program, project, or expenditure and does not change the need to obtain the required Commission/Council approvals and CEQA review for a specific program, project, or expenditure. The Implementation Plan also addresses the Commission's housing responsibilities including the low and moderate income housing fund. The Plan estimates the amounts available and that will be deposited into the housing fund during the five-year planning period. The Plan also establishes a five- year housing program with estimated expenditures; it explains how the agency will implement the required expenditures over a 10-year period; and it estimates the numbers of low- and moderate - income units required to be developed over the life of the plan and during the next 10 years. FINANCIAL STATEMENT: APPROVED: ACCOUNT NO. APPROVED: MIS Not applicable. Finance ENVIRONMENTAL REVIEW: Pursuant to Health and Safety Code Section 33490(a)(1)(B), the adoption of an implementation plan shall not constitute a project within the meaning of Section 21000 of the Public Resources Code ORDINANCE: INTRODUCTION: FINAL ADOPTION: STAFF RECOMMENDATION: Approve the Five -Year Implementation Plan. BOARD / COMMISSION RECOMMENDATION: Not applicable. ATTACHMENTS: 1. Draft Five -Year Implementation Plan. DRAFT FIVE YEAR IMPLEMENTATION PLAN 2010-2014 NATIONAL CITY REDEVELOPMENT PROJECT COMMUNITY DEVELOPMENT COMMISSION CITY OF NATIONAL CITY Exhibit A O001 'oomo 1�+ OIL -RI Jmmmm[d]mWD —®mmm®mmomoo E mmmm❑❑aom❑o ED grompopoceor ►mommmmmn[ Sao❑r' + a❑m❑ rLJ + National City Redevelopment Project Area Project Area Boundary 0.25 05 1 Miles i National City Redevelopment Project Five Year Implementation Plan 2010-2014 ABOUT THIS IMPLEMENTATION PLAN In fulfillment of Article 16.5 of California Community Redevelopment Law, the Community Development Commission of the City of National City ("Commission") has prepared this Implementation Plan for the National City Redevelopment Project Area ("Implementation Plan"). Included in this document are the Commission's anticipated redevelopment and affordable housing program. The Implementation Plan conforms to the National City General Plan and has been prepared according to guidelines established in the programs and goals outlined in the Housing Ele ent of the General Plan. Contents About this Implementation Plan the Project Area Recent Accomplishments Revenue Projections Redevelopment Strategy Redevelopment Plan G Proposed Redevelopment Tier 1 Ti Housi ousin rams.... s es on ing old Types 1 2 2 3 3 4 5 5 8 10 10 12 12 Page 1 National City Redevelopment Project Five Year Implementation Plan 2010-2014 THE PROJECT AREA The Community Development Commission of the City of National City was formed in 1969 to facilitate redevelopment activities in the City. Between November 1969 and December 1981, the Commission established redevelopment districts in several parts of the City. In 1995, the Commission adopted the Harbor District redevelopment project area to expanded redevelopment activities predominantly in lands adjacent to the maritime facilities owned by the San Diego Unified Port District. As part of the Harbor District project area adopt' n, the Commission merged all six projects into one Redevelopment Project Area (Project Areillustrated in Exhibit A. Combined, the component areas of the merged Project Area cover 2,0• A+F s, including most of the City west of Interstate 805. The Redevelopment Plan expires in 2040. Over the past 42 years, the Commission has funded the follow' "`n" tiativ=emprove conditions in the Project Area: • Public Improvements: The elimination or am implementation of Code Enforcement Program Sidewalk and ADA Accessibility Projects. • Economic Development: The establishment of the center and industrial park developme • Community Revitalization: The prom of the housing facilities. RECENT ACC In the last five Project Ar • • Completi Completion o Adoption of the Do ars, the brary; Center; ge; Specific Plan; ion of infrastructure ncy through the way Lands aping Projects, =: Curb, Gutter, Mile of Cars along with commercial I capital through the development many successful projects and programs in the Adoption of the Westside Specific Plan; Completion of Pier 32 Marina; Completion of Marina Gateway hotel and restaurant; Establishment of the San Diego Regional Enterprise Zone; 3 Page 2 National City Redevelopment Project Five Year Implementation Plan 2010-2014 • Completed an 80—unit senior complex, known as Plaza City Apartments; • Completed three single family "For Sale" units on Sheryl Lane; • Completed National City Boulevard streetscape improvements from Division Street to 16th Street; • Completed Morgan Square public plaza at National City Boulevard and 9th Street. REVENUE PROJECTIONS The Commission is using redevelopment along with other fins enhancement of the Project Area as a whole. Because mo design phase, final costs to generate 5-year expense pr Commission had approximately $15,645,135 in cash a year. It is estimated that the Commission will receiv during the 2010-11 fiscal year, of which $3,027,542 total costs associated with the Implementation Plan against $55.4 million in revenue and remaining bond pr next five-year planning cycle (2009-10 to 013-14) appro increment revenue for the Project Area w€€€tio't -aside for aff REDEVELOPMENT The redevelopment improve public facilitie • Busine pote a • Pub to attra include improvemen ci "ties. This s"; velopment an ional facilit nhanc GY ects are s are unkno n hand at the end oximately $14,303,754 set -aside f ffordable hous partnerships to facilitate e pre -development and most projects. The 2009-2010 fiscal s tax revenue, ivities. The ed to be $46.4 ``ton balanced e 2010-2011 fiscal year. Over the twenty percent of total property tax e housing activities. pronged: retain and attract businesses and jobs, increase the supply of affordable housing. ze on e t opportunities in the industrial areas and the munity. This st ategy emphasizes business retention, growth, and and development of employment opportunities. Public and private mote new development and enhance existing businesses. gy see to improve public infrastructure and facilities, which is critical estment while improving the community's quality of life. Projects may landscape beautification, mobility and circulation, and other needed existing community and to stimulate new development. • Infill Developme'-11 development will be encouraged and facilitated, including new mixed -use residential develop ;"t along commercial corridors. This will assist in the development of additional affordable dwelling units while improving the residential consumer base to support existing businesses and new commercial development. • Affordable Housing. Rehabilitate and improve the existing housing stock for all income levels and assist with the relocation of incompatible uses through innovative programs and neighborhood initiatives. Page 3 National City Redevelopment Project Five Year Implementation Plan 2010-2014 REDEVELOPMENT PLAN GOALS The 1995 Redevelopment Plan establishes goals for the redevelopment of the Project Area. These goals frame the redevelopment projects and programs of the Implementation Plan. The Redevelopment Plan goals are listed below: I. Eliminate and prevent the spread of conditions of blight including: underutilized properties and deteriorating buildings, incompatible and uneconomic land uses, deficient infrastructure and facilities, obsolete structures, and other economic deficiencies in order to create anore favorable environment for commercial, office, industrial, residential, and recreational develop Unify City's Harbor District with the downtown area through enh 'employment, commercial, and maritime development opportunities. Expand the commercial base of the Project Area. Improve public facilities and public infrastructure. Improve inadequate drainage infrastructure. Improve and/or provide electric, gas, telephone, and '.'"`infrastructure to both developed and undeveloped properties within the Prrea. Promote local job opportunities. Encourage the cooperatlo and particip agencies, and commun ,„tt h-lions in Implement design unity and integri Address parcels of p usefuln :velop XI. R XII. Rec enhanci XIII. Promote the d/or develop u e City's financ ilitati• usin'"ases, business persons, public lization of the Project Area. aesthetic and environmental quality, and provide t Area. and shape, are inadequately sized for proper Itiple ownership. osition and development through the assembly of property into served by improved infrastructure and public facilities. tilize. ""arcels to accommodate higher and better economic uses while esources. xisting housing stock. XIV. Increase, improve,: E`"preserve the community's supply of housing affordable very low, low and moderate income ho eholds. Page 4 National City Redevelopment Project Five Year Implementation Plan 2010-2014 PROPOSED REDEVELOPMENT PROGRAM The Implementation Plan consists of redevelopment projects and programs that are described below along with the blighting conditions that would be eliminated, the approximate costs to implement, and the Redevelopment Plan goals achieved. The projects and programs are categorized into three tiers in order of priority (1, 2, and 3). Tier 1 Projects/Programs Westside Infill Transit Oriented Development (WI-TOD) 201-unit family affordable housing project along Paradise Cry park, and trail. This project will eliminate factors hindering econom' and inadequate public infrastructure. Public right-of-way improvements include re diagonal parking, widened side alks, pedest landscape medians, streets:, other en This project will elimi and inadequate pu e streets project trian and bicycle eliminate fact .lic infrast indering economically viable uses re. I, IV, V, VI, VIII, IX, X, XI, XII, XIV Page 5 National City Redevelopment Project Five Year Implementation Plan 2010-2014 Gateway to the Mile Project (Sudberry) 25-acre regional commercial center anchored by Lowe's home improvement. This project will eliminate factors hindering economically viable uses and inadequate public infrastructure. Completion: 2013 D Avenue Community Corridor I Complete streets project with traffic calming, safe routes to and pedestrian and bicycle enhancements. This project will eliminate factors hindering econom and inadequate public infrastructure. Completion: 2013 Aquatic Center Aquatic recreational center with boat and k Diego Bay with programming through a partn Bay YMCA. This project will elimi and inadequate pu Completion: 2013 Las Palties Up incl advanc municipal and improvem he gym, locker r hase 11, which nurse. Ily viable uses exis rk and recreational facilities , an. ¢t., public facilities in expa ' the park to the adjacent This project wil `" s(' ' ate f. hindering economically viable uses and inadequate p Completion: 2013 cture. $2,500,000 $3,300,000 $6,500,000 I, Ill, IV, V, VI, VII, VIII, IX, X, XI, XII I, IV, VIII I, IV, IX I, IV, VII Page 6 National City Redevelopment Project Five Year Implementation Plan 2010-2014 Senior Village Expansion Project Commission has entered into an Exclusive Negotiations Agreement with a developer to rehabilitate the existing 303 unit Kimball and Morgan Towers and to construct 200 new senior units adjacent to Kimble and Morgan Towers. The majority of units will be income restricted. This project will eliminate factors hindering economically viable uses, unsafe and unhealthy buildings and inadequate public infrastructure Completion: 2014 Residential Rehabilitation Program The Commission will administer a program that prov qr` ancing to residential properties to improve residential neighb.' s and to educate residents on health dangers of lead; require t . and lead hazard reduction in conjunction with rehabilitation. This program will eliminate: factors hind uses and unsafe and unhealthy buildings. Completion: 2014 First -Time Homebuyer The Commission w $40,000 to help low - time homebuyers throu certificates. omically via that wil''i e resident rt+t,vide up to ome first- 33at add=redit The p+„ssl "'' will eli �; t facf's I dering economically viable us Housing In The Commission,]"? of rental units and to regards to code violatio Mousing and Safety Code inspections assistance to property owners with and solutions thereof. This program will eliminate: factors hindering economically viable uses and unsafe and unhealthy buildings. Completion: 2014 $7,000,000 $1, 0 $1,000,000 $500,000 I, IV, VIII, IX, XIII, XIV I, XIII, XIV XIV I, XIII, XIV Page 7 National City Redevelopment Project Five Year Implementation Plan 201D-2014 Housing Acquisition -Rehabilitation Program The Commission will work with for -profit and non-profit housing developers to acquire, rehabilitate, and construct new affordable housing units. This program will eliminate: factors hindering economically viable uses and unsafe and unhealthy buildings. Completion: 2014 Total Preliminary Cost Estimate Tier 2 and Tier 3 Projects/Programs Plaza Boulevard Streetscape Improvem Widening and improvement Boulevard from Interstat This project will eli and inadequate pub Completion: Plaza Est Boulev This project and incompati Completion: TBD ublic nigh'-„ Avenue. g econo `; y viable uses s Im"ex'':ement District prove'' t District along Plaza indering economically viable uses $1,500,000 $300,000 $700,000 I, XIII, XIV I, IV III, VIII 9 Page S National City Redevelopment Project Five Year Implementation Plan 2010-2014 Marina Gateway — Two blocks between McKinley and Harrison Avenues, 23rd and 24th Streets The Commission is in negotiations with Marina Gateway Development Company for a commercial project on the former Ace Metals site on West 23rd Street. This project will eliminate factors hindering economically viable uses, unsafe and unhealthy buildings and incompatible uses and will create jobs. Completion: TBD Harbor District Master Plan This plan will guide development and public improv 22nd Street to Civic Center. This project will eliminate factors hinderin unsafe and unhealthy buildings, incomp environmental remediation. Completion: TBD Harbor District Joint Pla The CDC and Port a redevelopment of a east of Tidelands Ave Gateway improvements recreatio The { f us j reme Completio Purple Cow fact ildin economically ses and s from reemen"'-,, +Ian south of ,�,� treat and wardil g Marina �,„ be public I spaces to . r: jobs. dering economically viable • environmental The land held for resa =`"anticipated to be developed for either affordable housing or commercial purposes. This project will eliminate: factors hindering economically viable uses and unsafe and unhealthy buildings. Completion: TBD $50,000 $140,000 $400,000 I, II, III, IV, VII, IX, X, XI, XII I, 11, III, IV, VII, VIII, IX I, II, III, IV, VII, VIII, IX, XII I, Ill, VII, IX, X, XI, XII, XIV /D Page 9 National City Redevelopment Project Five Year Implementation Plan 2010-2014 HOUSING PROGRAM COMPLIANCE OBJECTIVES This section addresses specific requirements in state law with respect to prior affordable housing activities and the anticipated housing program in the future. Redevelopment agencies use implementation plans to establish 10-year objectives to achieve compliance with state law regarding their affordable housing programs. These housing objectives generally fall into three categories: • Housing Production — based on the number of housing units constructed or substantially rehabilitated over a 10-year period, a redevelopment agency is to ensure that kh"eentage of these units are affordable to very -low, low- and moderate- income households a requirements only apply to project areas established on or after January 1, 1976; consee a� two component areas of the Project Area (E.J. Christman 1 Area and the South Bay To i �'�u. try Area) are exempt from these requirements. • Replacement Housinq — redevelopment agencies m , j''" ure that any h removed as a result of redevelopment project are r f�Ft d within four years. 1976 component areas (E.J. Christman 1 Ar ;g South Ba Town and C requirements took effect after January 1 1996. • Targeting Household Types — identify the amount agency will allocate during the 10-y®u-riod on incre affordable to very low income house under the age of 65. Housing Produc To estimate the nuni a- the Commission estim Project Area a' . applied affordable ensurin • ,'Fi` The e a g table sum low incom units destroyed or espect to the pre - Area), these set -aside funds the redevelopment and improving the supply of housing seholds, and housing for residents affordable to low- and moderate- households, onstructed or substantially rehabilitated in the edevelopment Law. The number of required upon statuto ' fE resholds, and the Commission is responsible for r of affordable units is created during the 10-year planning period. uction goals. that need '. 'ts to ctual and Pro e.r Housin reduction Needs by Time Period Time Perio• '�{Actual/Assumed i31�$j Housing Units Constructed and Substantially Rehabilitated in Project Area /1 Required Affordable Units /2 Total Very Low Prior to 2004-05 1,588 238 95 10 Year Forecast 2004-05 to 2008-09 2009-10 to 2013-14 800 511 289 120 48 77 31 43 17 Redevelopment Plan Duration (1976 to 2040) 2,388 358 143 11 2/ Exclusive of E.J. Christman 1 Area and South Bay Town and Country Area, which are exempt from production housing needs. All required units based on 15 percent of actual/assumed units developed by entities other than Agency. (Production requirement for units developed by Agency is 30 percent). I! Page 10 National City Redevelopment Project Five Year Implementation Plan 2010-2014 The Commission estimated a need for 120 affordable units (including 48 very low-income units) to fulfill its production goals for the ten year Housing Production period, and 358 affordable units (including 143 very low-income units) over the duration of the Redevelopment Plan. Based on housing production during the past Implementation Plan period, the current forecast need for very low income units has been achieved with an excess production surplus of four units. The current forecast need for total units is 156. Fulfillment of these productions goals is shown in the following table. Housing Production Time Period Prior to 2004-05 South Bay Manor Covenants Expiring': Park Villa Point McKinley Apartments Kimball Senior Park Paseo del Sol/Copper Hills Various Subst. Rehab 10 Year Forecast 2004-05 to 20 Production 2005-06 to pr Habitat — Hardin. Avenue Habita Casa Casa Famili Pacific View — Fig C Plaza City Apartment Units Required (from previous table) Total VL 238 95 Units Pr VL 3 0 8 0 17 5 9 2 5 0 80 60 Remaining Jnits Required VL 283 61 Net Surplus Units Produced Total VL 0 0 Redevelopment Plan Duration (1976 to 2040) 358 143 202 147 156 0 0 4 'Units produced with covenants that expire during the Redevelopment Plan duration are not counted towards the production totals. Page 11 National City Redevelopment Project Five Year Implementation Plan 2010-2014 Replacement Housing During the Implementation Plan period, the Commission does not anticipate that any Commission - assisted projects will result in the displacement or removal of housing units. Consequently, the Commission does not anticipate that any housing will need to be replaced at this time. Expenditures by Household Types At the beginning of the Implementation Plan period (July 1, 2010), the fund had a balance of approximately $12,874,593. Over the five-y 14) approximately twenty percent of total property tax increment aside for affordable housing activities. The low- and moderate- income housing set -aside rev community's need for very low- and low- income hous' age of 65. Based on the Regional Housing Needs thresholds for expenditures would be required over t Household Type Very Low Income Households Low Income Hou a! Ids Households Housing S year per' endin hou moderate income housing lining cycle (2009-10 to 2013- the Project Area will be set - is to be expen the proportion of th ent and 2000 Census, th of the I : jo,.t entation Plan. um Perce 15 8 00 of Expenditures proportion to the ulation under the wing minimum hese ity requirements affect expenditures over a ten- ts the compliant initially for a period beginning in January 2002 and Th s rt below documents the amount of low- and moderate- income ce J 2002 for these income categories: Housing Expenditures by Year Income Category 01-r +'.'2-0 tt,F 3-04 04-05 05-06 06-07 07-08 08-09 09-10 Proportion Very Low $250 Ga z $0 $0 $0 $0 $0 $3,039,197 $0 73% Low $0 $0 $23,733 $0 $0 $0 $0 $1,109,703 $0 27% Moderate $0 $628 $3,490 $0 $0 $0 $0 $0 $0 <1% Totals $250 $628 $27,223 $0 $0 $0 $0 $4,148,900 $0 100% 13 Page 12 National City Redevelopment Project Five Year Implementation Plan 2010-2014 Units Assisted by Housing Set -Aside Fund. State law requires a recap of the projects assisted over the past Implementation Plan period, including family projects (open to all age groups) and senior projects (restricted to residents age 65 and older). The following table summarizes expenditures by project. Units Assisted 2004-05 to 2008-09 Project Expenditure Ext. Low Very Low Low Moderate Total Family Projects: Casa Familiar D & E Habitat G Avenue Senior Projects: Plaza City Apartments Totals $669,653 $57,247 $3,422,000 Units Constructed During Prior Imple Implementation Plan period, the following other than or in addition to set aside funds restricted units (affordable u r"IE�I ovenants rental housing). • Habitat — Hardin 5 12 20 50 17 8 B0 -Aside Funds. During the prior d or federal funding sources featuring long term covenant ownership housing or 55 years for lit Page 13 CITY OF NATIONAL CITY, CALIFORNIA COMMUNITY DEVELOPMENT COMMISSION AGENDA STATEMENT MEETING DATE: March 29, 2011' AGENDA ITEM NO. 3 ITEM TITLE: Resolution - Five -Year Implementation Plan for the National PREPARED BY: Raymond Pe, PHONE: 336-4421 EXPLANATION: Resolution adopting the Five -Year Implementation Plan fo Area. City Redevelopment Project Area. DEPARTMENT: Co unit / Development APPROVED BY: r the National City Redevelopment Project FINANCIAL STATEMENT: ACCOUNT NO. Not applicable. APPROVED: APPROVED: Finance MIS ENVIRONMENTAL REVIEW: Pursuant to Health and Safety Code Section 33490(a)(1)(B), the adoption of an implementation plan shall not constitute a project within the meaning of Section 21000 of the Public Resources Code ORDINANCE: INTRODUCTION: FINAL ADOPTION: STAFF RECOMMENDATION: Adopt the resolution. BOARD / COMMISSION RECOMMENDATION: Not applicable. ATTACHMENTS: RESOLUTION NO. 2011 — 71 RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY APPROVING THE FIVE-YEAR IMPLEMENTATION PLAN (FY 2009-2010 THROUGH FY 2013-2014) FOR THE NATIONAL CITY REDEVELOPMENT PROJECT WHEREAS, the Redevelopment Plan for the National City Redevelopment Project Area of the Community Development Commission of the City of National City ("CDC") was approved by the City Council by Ordinance No. 1233, adopted on November 18, 1969; and WHEREAS, the Redevelopment Plan was subsequently amended on June 24, 1975, by Ordinance No. 1471; on April 3, 1976 by Ordinance No. 1505; on December 13, 1977, by Ordinance No. 1610; on December 1, 1981, by Ordinance No. 1762; on April 16, 1985, by Ordinance No. 1851; on July 18, 1995, by Ordinance No. 2095; and on July 17, 2007, by Ordinance No. 2007-2295; and WHEREAS, Section 33490(a)(1)(A) of the California Community Redevelopment Law (California Health and Safety Code33000, et.seq.) requires all redevelopment agencies/commissions to adopt an Implementation Plan every five (5) years, following a noticed public hearing; and WHEREAS, Section 33490(a)(1)(A) of the California Health and Safety Code also requires that the Implementation Plan contain the specific goals and objectives of the CDC for the Redevelopment Project Area; the specific programs, including potential projects, and the estimated expenditures proposed to be made during the next five (5) years; and an explanation of how the goals and objectives, programs, and expenditures will eliminate blight within the Redevelopment Project Area and implement the requirements of Section 33334.2, 33334.4, 33334.6 and 33413 of the California Health and Safety Code; and WHEREAS, pursuant to section 33490, the CDC has prepared a Five -Year Implementation Plan (Fiscal Year 2009-2011-0 through Fiscal Year 2013-2014) for the Redevelopment Project Area; and WHEREAS, on March 29, 2011, pursuant to the requirements of the California Health and Safety Code, the CDC has conducted a duly noticed public hearing. NOW, THEREFORE, BE IT RESOLVED by the Community Development Commission of the City of National City as follows: 1. The Five -Year Implementation Plan (Fiscal Year 2009-2011 through Fiscal Year 2013-2014) for the National City Redevelopment Project Area is hereby approved and adopted. 2. This approval and adoption of the Five -Year Implementation Plan (Fiscal Year 2009-2011 through Fiscal Year 2013-2014) does not constitute the approval of any specific program, project or expenditure, and does not change the need to obtain any required approval of a specific program, project or expenditure from the Community Development Commission of the City of National City. --- Signature Page to Follow --- Resolution No. 2011 — 71 Page Two PASSED and ADOPTED this 29th day of March, 2011. Ron Morrison, Chairman ATTEST: Brad Raulston, Secretary APPROVED AS TO FORM: Claudia G. Silva CDC General Counsel MEETING DATE: CITY OF NATIONAL CITY, CALIFORNIA COMMUNITY DEVELOPMENT COMMISSION COUNCIL AGENDA STATEMENT March 29, 2011 AGENDA ITEM NO. 4 ITEM TITLE: Resolution of the CDC authorizing the sale of GNMA Certificates securing the CDC's Multifamily Housing Revenue Bonds (GNMA Collateralized — Park Villas Apartments) 1997 Series A and Series A-T, and the use of the proceeds from the sale thereof to redeem all bonds and to pay transaction costs related thereto; and delegating to the Executive Director the power to take all such actions as are necessary or appropriate to accomplish the foregoing. PREPARED BY: Chris Zapata DEPARTMENT: Cit PHONE: Ext. 4240 APPROVED BY: EXPLANATION: Please see attached. FINANCIAL STATEMENT: APPROVED: Finance ACCOUNT NO. APPROVED: MIS $227,500 is to be reimbursed to the CDC for 13 years of past due administrative fees. $50,000 is to reimburse the City of National City for administrative expenses in relation to the transaction. ENVIRONMENTAL REVIEW: N/A ORDINANCE: INTRODUCTION: FINAL ADOPTION: STAFF RECOMMENDATION: Adopt proposed Resolution. BOARD / COMMISSION RECOMMENDATION: N/A ATTACHMENTS: Staff Report RESOLUTION NO. 2011 — 72 RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY ("CDC") AUTHORIZING THE SALE OF GNMA CERTIFICATES SECURING THE CDC'S MULTIFAMILY HOUSING REVENUE BONDS (GNMA COLLATERALIZED — PARK VILLAS APARTMENTS) 1997 SERIES A AND SERIES A-T, AND THE USE OF THE PROCEEDS FROM THE SALE THEREOF TO REDEEM ALL BONDS AND TO PAY TRANSACTION COSTS RELATED THERETO; AND DELEGATING TO THE EXECUTIVE DIRECTOR THE POWER TO TAKE ALL SUCH ACTIONS AS ARE NECESSARY OR APPROPRIATE TO ACCOMPLISH THE FOREGOING WHEREAS, the Community Development Commission of the City of National City (the "CDC") has previously issued its $12,000,000 Multifamily Housing Revenue Bonds (GNMA Collateralized — Park Villas Apartments) 1997 Series A and $1,000,000 Multifamily Housing Revenue Bonds (GNMA Collateralized — Park Villas Apartments) Taxable 1997 Series A-T pursuant to an Indenture of Trust dated as of June 1, 1997 (the "Indenture") between the CDC and First Trust of California, as trustee (the "Trustee"); and WHEREAS, the Bonds are secured by, among other things, a fully modified pass -through mortgage -backed certificate guaranteed by the Government National Mortgage Association (the "Certificate"); and WHEREAS, as a result of the current condition of the financial markets, the secondary market value of the Certificate is well in excess of the amount needed to redeem the Bonds in full under the Indenture; and WHEREAS, in order to maximize the economic benefits arising from the current trading price of the Certificate, the CDC desires (a) to sell the Certificate for an amount sufficient to redeem all Bonds on or about April 4, 2011, in accordance with the terms of the Indenture, and (b) to use a portion of the excess proceeds from the sale of the Certificate to pay transaction costs arising from the transaction. NOW, THEREFORE, BE IT RESOLVED by the Community Development Commission of the City of National City, as follows: Section 1. Subject to and conditioned upon the satisfaction of the conditions listed in Section 4, the CDC hereby approves the sale of the Certificate, the redemption of the Bonds on or about April 4, 2011, and the payment of transaction costs related thereto. Section 2. The Executive Director of the CDC is hereby authorized to do all such acts and things necessary to accomplish the sale of the Certificate, the redemption of the Bonds, and the payment of transaction costs associated with the transaction. Section 3. Estrada Hinojosa and Southwest Securities are hereby appointed as joint structuring agents in connection with the sale of the Certificate; Jones Hall is hereby appointed as bond counsel; and Urban Futures, Inc., is hereby appointed as financial advisor in connection with the transaction. Section 4. The approvals and authorizations granted in this Resolution are subject to the condition that the CDC receive such legal opinions, certifications, and other documents and proceedings as are necessary or advisable, in the sole opinion of the Issuer's legal counsel, Resolution No. 2011 — 72 Page 2 to evidence compliance by participants in the transactions contemplated by this Resolution with the CDC's policies and procedures and applicable federal and state laws. Section 5. Neither the CDC nor any director, officer, official employee, or agent of the CDC is subject to any personal liability or accountability by reason of the transaction described herein. Section 6. In the event of the inability or unavailability of any official of the CDC to perform any duty assigned to such official by the terms of this Resolution, any officer or employee of the CDC authorized to act for such official is hereby authorized and directed to so. Section 7. All acts and doings of the officers of the CDC which are in conformity with the purposes and intent of this Resolution are in all respects approved, ratified, and confirmed. Section 8. The provisions of this Resolution are hereby declared to be separable, and if any action, phrase, or provision is for any reason declared to be invalid, such declaration does not affect the validity of the remainder of the sections, phrases, and provisions. Section 9. This resolution shall take effect immediately upon its passage. PASSED and ADOPTED this 29th day of March, 2011. Ron Morrison, Chairman ATTEST: Brad Raulston, Secretary APPROVED AS TO FORM: Claudia G. Silva CDC General Counsel SUMMARY RECOMMENDATION: Recommendation to approve the Resolution authorizing the sale of GNMA Certificate securing the Commission's 1997 Series A Multifamily Housing Revenue Bonds -Park Villas Apartments and the use of the proceeds from the sale to redeem all bonds and to pay transaction costs related and delegating the City Manager the power to take all such actions as are necessary or appropriate to accomplish the foregoing. DISCUSSION: The subject bonds were issued pursuant to an Indenture of Trust, dated June 1, 1997 by and between the Community Development Commission of the City of National City (the Issuer) and the Trustee to finance a mortgage loan to Park Villas Pointe LP, in order to finance the acquisition and rehabilitation of 268-unit multifamily rental housing project located in the City of National City at 817 Eta Street. The Park Villas Apartments is secured by an FHA/HUD mortgage with the guarantee as to principal and interest payments by Government National Mortgage Association (GNMA). The Bonds were originally rated "AAA" when the Investor purchased the bonds Unfortunately S/P has downgraded the bonds to "B" on January 6, 2011 (attached). This rating is not satisfactory to the investment community or Commission staff. Best practices for debt management recommend the Commission review and exhaust all remedies to maintain the highest level of credit rating as possible. The bond documents allow for the Commission to address and fix events like this downgrade. Actions by Issuers to correct situations like this have a very positive effect on the bond investor community. Also, the bond investors have requested the Community Development Commission take steps necessary to discharge the lien under the Indenture and pay off the 1997 Multifamily Bonds. Discharging the lien under the Indenture and paying off the 1997 Multifamily Bonds can be accomplished under the Optional Redemption provisions of the Indenture, which allows the sale of the GNMA security and use of proceeds of the sale by Issuer to redeem the 1997 Bonds prior to maturity. Jones Hall, Bond Counsel has reviewed the proposed bond redemption and will be providing its legal opinion to the Trustee and Commission relative to sale of the GNMA and redemption of the bonds. The bondholders will not object to said redemption of the Bonds. The bonds were issued with a Regulatory Agreement and Declaration of Restrictive Covenants between the Commission and the Park Villas Point LLP. The Regulatory Agreement establishes that 40 percent of all units must rented or held available to very low income tenants for a "qualified project period" which is the length of time the affordable housing covenants are to in place. The qualified project period ends on the later of the following covenant periods: a) The date which is fifteen (15) years after the date on which at least fifty percent (50%) of the units in the project are first occupied; or b) The first date on which no tax-exempt private activity bonds with respect to the Project are outstanding; or 1 Summary Report GNMA Certificates Resolution c) The date on which any assistance provided with respect to the Project under Section 8 of the Housing Act terminates Based on the above definition of the qualified project period, calling the bonds does have the effect of eliminating some or all of the Park Villas units from the City's affordable housing numbers earlier than might he without redeeming them in 2011. If bonds are redeemed, under item "a" above, the covenant period expires at the earliest in June 2013 (estimated). If the bonds are not redeemed, under "b" above the expiration would likely be later than that date. How much later is impossible to say at this point in time, however most borrowers refinance their projects at the end of the 15 year period and if that is done by the borrower here, at that point the affordable housing restrictions would likewise go away. Given the current and recent interest rate environment such a refinance is likely, meaning the qualified project period would end at about the same time with or without the early call the Commission is now considering. The restructuring concept is quite simple (See attached Chart). It calls for the GNMA Certificate to be sold to a new investor. The proceeds of the GNMA sale provide the funds to call the bonds and pay for all costs associated with redeeming the bonds. FISCAL IMPACT: With the sale of the security the Commission will not violate the Indenture, will remedy the rating downgrade issue and meet the following priority objectives: • Recover outstanding annual fees of $17,500, which have not been paid since the inception of the project (balance due is estimated at $227,500) • Generate a fee due to the Commission from this transaction, which is estimated at $50,000. • Provide funding for needed capital improvements to the Park Villa Apartments The Park Villas Apartments will continue to make their mortgage payment to the investor on its GNMA/HUD mortgage. The balance of the proceeds from the sale of the GNMA Certificate securing the Commission's 1997 Series A Multifamily Housing Revenue Bonds, estimated at $200,000, will go to Park Villas. In recent years, Park Villas has requested financial assistance from the Commission through the CDC's Community Development Block Grant funds for a variety of improvements including better lighting and security cameras. Staff intends to recommend the funds made available to Park Villas from this bond redemption be used within the Park Villa Apartment facility for security cameras and other needed improvements. The Park Villas Apartment also saves additional monies by no longer paying the Trustee fee and other program costs under the Indenture such as Disclosure and Rebate expenses. Staff is recommending that these cost savings be applied to the project. Similar to previous bonds issued by the Commission, fees will be paid from for services rendered by the financing team. All fees will be paid through the sale of the CNMA Certificate and will not require Commission funds. The following is a summary for the cost of redemption: 2 Summary Report GNMA Certificates Resolution Financing Team Fee Amount Financial Advisor $30,000 Structuring Agent $75,000 Mortgage Advisor $15,000 Bond Counsel $12,500 Rebate Calculation $15,000 Trustee $5,000 Totals $152,500 RECOMMENDATION / REQUESTED ACTION: Staff recommendations the adoption of the Resolution authorizing the sale of GNMA Certificate securing the Commission's 1997 Series A Multifamily Housing Revenue Bonds -Park Villas Apartments and the use of the proceeds from the sale to redeem all bonds and to pay transaction costs related and delegating the City Manager the power to take all such actions as are necessary or appropriate to accomplish the foregoing. Additionally, staff recommends the Commission enter into agreements with the following professional firms to provide services necessary to complete this task including, Jones Hall as Bond Counsel, and Estrada Hinojosa/ Southwest Securities as joint Structuring Agents. The Commission will continue to work with its existing Financial Advisor, Urban Futures. The schedule below has an anticipated closing of May 7, 2011. Date Description Party Status March 29 Request Board of CDC of National City to authorize: 1) Redemption of 1997 Bonds in Full 2) Sale of GNMA Securities 3 Transaction Particisants IS, BC, SA/MA April 4 GNMA Security offered to Market If acceptable, winning bid accepted by CDC of National City Conditional Call Notice — Full Redemption of Bonds on 30 da notice Aril 6 SA IS TR May 4 Settlement date of GNMA Security Bond Trustee invests All Excess Funds until 5/6/2011 ALL TR May7 Circulate final Closing/Wiring Memorandum All documents executed Payment by Bond Trustee of All Fees, Release of Money to Issuer Final Arbitra.e Rebate Resort Issued ALL TR TBD 3 Summary Report GNMA Certificates Resolution FINANCING TEAM . ' 4oithe ityofNationa1City Issuof:, Bond Counsel: Jones Hall BC Structuring Agent: sttada;Hinoiosa/ Southwest Securities SA Trustee: U.S. Bank N.A. TR Financial Advisor Urban Futures ' tS .' Arbitrage Rebate Urban Futures MA Attachments: Standard & Poor's Summary of Credit Downgrade Restructuring Flow Chart 4 Summary Report GNMA Certificates Resolution Mortgage Pmt Flow Owner of Project Mortgage Payment Required by Mortgage Note GNMA/FHA Mortgage Note Servicer Trustee* Bondholders Mortgage Payment Flow After Sale of GNMA Owner of Project Mortgage Payment Required by Mortgage Note *Trustee currently hod s GNMA as Seal rftv for Bonds. "if Mortgage payment is less than Re.quired, GNMA makes up the difference. They are the 'owner of the GNMA/FHA Note in this case Servicer Private Investor/New Owner of GNMA/FHA Mortgage Note (I) One Time Opportunity Value of GNMA Security in the Open Market Greater Than Cost of Redeeming. Bonds *This opportunity exists for two reasons: it is alfowed under the documents (Legg AND the value of GNMA securities 15 at an all time high. This market anomaly will not last forever (1) The Trustee and Bondholders have been replaced with a private investor„ All other aspects of original financing remain the same. STANDARD &POOR'S January 6, 2011 City of National City 1243 National City Blvd. National City, CA 91950 Attention: Ms. Jeanette Ladrido, CPA, Finance Director One Markel Steuart Tower, 15th Floor San Francisco, CA 94105.1000 tel 415 371.5000 reference no.: 40076439 Re: National City Community Development Commission, California, Multifamily Housing Revenue Bonds (Park Villas Apartments), Series 1997A Dear Ms. Ladrido: Standard & Poor's has reviewed the rating on the above -referenced obligations. After such review, we have changed the rating to "B" from "BB+" while affirming the not meaningful outlook. A copy of the rationale supporting the rating and outlook is enclosed. The rating is not investment, financial, or other advice and you should not and cannot rely upon the rating as such. 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