201 S. Anaheim Blvd.
Second Floor
Anaheim, CA 92805
Tel: (714) 765-4320
Fax: (714) 765-4630
www.anaheim.net
City of Anaheim
COMMUNITY & ECONOMIC DEVELOPMENT
DEPARTMENT
DATE: JUNE 22, 2021
FROM: COMMUNITY & ECONOMIC DEVELOPMENT DEPARTMENT
SUBJECT:
COOPERATION AGREEMENT TO TRANSFER HOME
INVESTMENT PARTNERSHIP PROGRAM FUNDS FOR
THE MIDWAY AFFORDABLE APARTMENTS AT THE
SOUTHWEST CORNER OF ANAHEIM BOULEVARD
AND MIDWAY DRIVE
ATTACHMENT (Y/N): YES ITEM # 09
RECOMMENDATION:
That the City Council, by Motion, approve a Cooperation Agreement for Midway Affordable Apartments by and between the City
of Anaheim (City) and the Anaheim
Housing Authority, substantially in the form attached hereto; and authorize the Acting Director of Community and Economic Development, or her designee, to administer the Cooperation Agreement on behalf of the City.
DISCUSSION:
The Anaheim Housing Authority (Authority) owns an approximately 2.33 acre site (Site), consisting of
several parcels acquired over the course of several years. The initial acquisition was completed in 2000 with the purchase of the former Matrix Service site, an automotive repair establishment.
In September 2019, Encore Anaheim, LLC (Encore)
acquired the Midway RV Park, an
approximately 5.48 acre RV Park (Encore Site), adjacent to the Housing Authority site.
The Encore acquisition included a non-contiguous 0.13 acre parcel at 110 West Midway Drive, which housed the RV Park’s main office and operations building. In an effort to provide both the Authority and Encore consolidated development sites, the two parties agreed to enter into an Agreement for Exchange of Real Property. The exchange provided the Authority and Encore with more efficient consolidated development sites.
While the exchange improved development options for the Authority, there remained outstanding access,
easement, and right-of-way challenges that impact both development sites. As a result, Encore and the Authority agreed to work together to achieve mutually beneficial site plans. Encore also requested the engagement of National Community Renaissance of California (National CORE), a reputable national non-profit affordable housing developer with over 60 developments in California totaling 6,650 units, as their development partner. The Authority has historically negotiated with neighboring
CITY COUNCIL AGENDA REPORT
Cooperation Agreement (Transfer of HOME Funds) for Anaheim Midway Affordable Housing Development June 22, 2021
property owners to realize more comprehensive projects that provide broader community benefits.
In May 2020,
the Governing Board of the Housing Authority approved an Exclusive Negotiating Agreement with National CORE to formulate an affordable housing development proposal on the Authority Site. National CORE has subsequently worked diligently with staff and the community to propose a project that leverages the proximity to major job centers, transportation lines, and other quality of life amenities such as schools, with Paul Revere Elementary School across Midway Drive.
The affordable rental development proposal
brought forth by National CORE, herein
referred to as the Project, includes a four-story contemporary apartment development consisting of 86 rental units. The Project will be 100% affordable, for families with incomes that fall within the extremely-low, very-low, and low-income households.
Project amenities for residents will be located on both the ground floor and a rooftop deck. Amenities will include a pool, children’s play area, urban garden, dog run, and outdoor gathering spaces. In addition, a 1,700 square foot community flex space will be provided on the ground floor at the corner of Anaheim and Midway, to accommodate various programming and meeting needs of the neighboring community. As has become customary in all Authority sponsored developments, a social services component that provides meaningful support for future residents is also being planned.
The Project
will provide 129 parking spaces throughout the site, which exceeds parking requirements for a development of this type. The development provides for an integrated, walkable community that considered the design of the neighboring Encore development. In addition, the plan provides enhanced points of legal ingress/egress to the Golden Skies Mobile Home Park to the south with the curved driveway from Anaheim Boulevard and a second access easement through the site and up to Midway Drive. Safe pedestrian walkways will also be provided to serve the Golden Skies Mobile Home Park residents. The City Council will consider a separate item at the June 22, 2021 meeting for the three necessary abandonments to accommodate development of the Site – Zeyn Street, a portion of alley, and the existing access easement for Golden Skies Mobile running through the site.
National CORE
and Authority staff held two virtual community meetings in April 2021 to review the Project with area residents. Community comments and questions indicated strong support of the Project with the majority of the questions asked centering on how to apply for future units. In addition, Authority staff has shared development plans and engaged in multiple discussions with Anaheim Elementary School District representatives as Paul Revere Elementary is located directly across the street from the site. School representatives have also signaled support for the Project and indicated that they are ready to address future increases in enrollment and to work collaboratively to explore student/family enrichment opportunities.
National CORE
proposes to finance the Project with a combination of funding sources including $21,525,165 from the California Tax Credit Allocation Committee, $8,649,000 from a private lender, and $1,362,651 from the Orange County Housing Trust Fund. National CORE will submit an application for 9% Tax Credits in July 2021 Cooperation Agreement (Transfer of HOME Funds) for Anaheim Midway Affordable Housing Development June 22, 2021
with an expected award in September 2021. If the Project is successful in obtaining all of its funding, construction can start in February 2022. While the majority of the funding needed to complete the Project is being sought from varying State resources, a financial gap still exists. To address the gap, the Authority proposes to enter into a not to exceed 60-year ground lease of the site valued at approximately $7,200,000. The ground lease allows the Authority to recoup the cost of acquiring the land as well over the term of the lease totaling $449,098. In addition, the Authority proposes to loan the project $1,958,698 Low Moderate Income Housing Asset Funds and $3,041,302 from federal HOME funds. Staff is also recommending that the City provide a fee deferral of its Park and Recreation Fee and Transportation Impact Fee in the respective amounts of approximately $465,155 and $111,542 in support of the Project. The inclusion of local funding sources as part of the financing structure increases the likelihood that State funds will be awarded to the Project. Total development cost for the Project is $44,313,513.
The Developer is
also requesting an allocation of eight Section 8 Project-Based Vouchers (PBV) for the Project. The PBV program is a component of the Section 8 Housing Choice Voucher (HCVP) program. The PBV component is distinguished from the tenant-based program in that rental subsidies are attached to the rental units and families who reside in the designated units receive the benefit of such assistance. The eight PBV units will be made available to families and/or individuals exiting homelessness.
Pursuant to Section 21094.5 of the
California Environmental Quality Act (CEQA),
Section 15183.3 of the CEQA Guidelines, and the Appendix N: Infill Environmental Checklist prepared for the Project, the Project was determined to have no new environmental impacts associated with the Agreements beyond those identified in the previously certified Program Environmental Impact Report (EIR) No. 330 for the General Plan and Zoning Code Update and Supplemental EIR No. 346 for the City of Anaheim Housing Opportunities Sites Rezoning Project, and that no further environmental review is required pursuant to CEQA.
Staff is supportive
of the Project, as proposed, and therefore requests that the City Council approve a Cooperation Agreement between the City and the Housing Authority to transfer up to $3,041,302 of federal HOME funds from the City to the Housing Authority so that the Housing Authority can loan such funds to the Developer for the Project.
The Housing Authority
will not enter into an Affordable Housing Agreement or release any funding until the Developer has provided evidence that all additional required third party funding is in place for this development, as required by the HOME program regulations. Additionally, any material changes in the terms outlined in the Preliminary Award Letter will be presented to the Governing Board of the Housing Authority for review and consideration.
Cooperation Agreement (Transfer of HOME Funds) for Anaheim Midway Affordable Housing Development June 22, 2021
IMPACT ON BUDGET:
All proposed assistance to the Project is derived from restricted funds provided by HUD and Low Moderate Income Housing Asset Funds in the Community & Economic Development Department’s proposed FY 2021/22 budget.
Respectfully submitted,
Grace Stepter
Acting Director of
Community and Economic
Development Department
Attachments:
1. Cooperation Agreement (Transfer of HOME Funds)
2. Location Map
3. Project Plans
2021 Trust NOFA Funding Recommendation
Agenda Item: 4
Attachment A
Project Name
Service
Planning
Area
Trust
Funded
Units
Total Units MHSA Funding
Request
Non-MHSA
Funding
Request
Total Request County
General Fund MHSA LHTF
Total
Recommended
Funding
Unfunded
Request
Funding
%
Paseo Adelanto South 26 50 $ 1,703,314.50 $ 1,600,000.00 $ 3,303,314.50 $ - $ 1,703,314.50 $ 1,600,000.00 $ 3,303,314.50 -$ 100% Westview House Central 25 85 $ - $ 2,500,000.00 $ 2,500,000.00 $ 791,139.00 $ - $ 659,210.19 $ 1,450,349.19 1,049,650.81$ 58% Orange Corporate Yard North 6 62 $ - $ 660,000.00 $ 660,000.00 $ 208,861.00 $ - $ 175,233.09 $ 384,094.09 275,905.91$ 58% Anaheim Midway North 8 86 $ 1,362,652.00 $ - $ 1,362,652.00 $ - $ 738,455.08 $ 624,196.92 $ 1,362,652.00 -$ 100% Crossroads at Washington Central 15 86 $ 2,500,000.00 $ - $ 2,500,000.00 $ - $ 1,354,812.29 $ 1,145,187.71 $ 2,500,000.00 -$ 100% Meadows Senior Apartments South 7 65 $ 1,192,320.00 $ - $ 1,192,320.00 $ - $ 646,147.91 $ 546,172.09 $ 1,192,320.00 -$ 100% Total 87 434 $ 6,758,286.50 $ 4,760,000.00 $ 11,518,286.50 $ 1,000,000.00 $ 4,442,729.78 $ 4,750,000.00 $ 10,192,729.78 1,325,556.72$ 88% Project Information Funding RecommendationFunding Request Updated 5/12/2021