Del Mar City Council Meeting Agenda
VIA TELECONFERENCE ONLY
1050 Camino del Mar, Del Mar, California
July 11, 2022 City Council Regular Meeting
INFORMATION RECEIVED
AFTER THE COUNCIL AGENDA
WAS DISTRIBUTED
(“Red Dots”)
1 Sarah Krietor
From: Laura DeMarco <[email protected]>
Sent: Monday, July 11, 2022 12:01 PM
To: Dwight Worden; Tracy Martinez; Terry Gaasterland; Dan Quirk; David Druker Cc: Ashley Jones; City Clerk Mail Box
Subject: Item 7 red dot: Opposition to continued suspension of in-person city council and city advisory commission, board and committee meetings
CAUTION: This email originated from outside of the organization. Do not click links or open attachments unless you recognize the sender and know the content is safe.
Dear Council Members and Staff,
Please pull Item 7 off the consent calendar to address these questions:
1) Why is Del Mar the only city in San Diego county that continues to ban in-person city council meetings? Neighboring Solana Beach resumed in-person city meetings on April 26. Why not Del Mar? 2) If there truly is a health emergency in Del Mar, why did council members chose to attend the Coastal Commission hearing last month at the Del Mar Hilton in person instead of virtually? The “Del Mar Way” of active citizen engagement requires in-person meetings. That is why two Del Mar City Council members attended the Coastal Commission hearing where they were able to more effectively lobby the Commissioners and staff in person and engage with constituents who were also attending the meeting.
In conclusion, please resume in-person meetings or offer a hybrid alternative so citizens can more fully participate and engage with policy makers whose decisions impact their lives, family, neighbors, and our entire community.
Thanks for your consideration,
Laura
July 11, 2022 Item 7
CITY COUNCL AGENDA QUESTIONS
JULY 11, 2022
Item 3 – List of Demands
What is this item for?
The payment included on the List of Demands for Del Mar Television is for services provided in the Third Quarter (January-March 2022), for public access and local origination programming for broadcasting and distribution of City Council, Planning Commission, and Design Review Board meetings on the local cable television system. This invoice for services is consistent with the Council approved contract with Del Mar Television, and reflects reductions for services that are not currently taking place due to COVID.
Item 5- As-Needed Agreement for Communication Services
1) What is the total paid not to exceed?
Typically, we do not have “not to exceed” amounts for as-needed consultants. The only reason this contract ever had a not to exceed amount was because the first contract was done under the City Manager’s signing authority which is only $15K so that had to be stated in the contract in order for the prior City Manager to sign. From there, the not to exceed amount stayed in the contract and kept being adjusted. Asneeded professional service agreements have a specific rate schedule, and we use the consultant(s) on an as-needed basis consistent with funds that are included in the approved budget for the services. For this last amendment, staff modified the agreement consistent with our other agreements for as-needed services by removing the not-to-exceed amount.
2) How many people subscribe to the DM Weekly? How many social media followers do we have? How many website hits?
We are up to 1,587 Facebook followers and 1,400 subscribers for the Del Mar Weekly. Prior to contracting with Adam Kaye, the City’s Facebook activity was pretty much non-existent. With Adam’s help, the City revamped the prior “City Manager Update” publication, which was retitled “Del Mar Weekly,” and Issue No.1 dropped on June 28, 2019. On Friday, July 8, the City published Issue No. 159. Since its launch, the electronic newsletter has never missed a Friday. Active subscribers have grown from 179 to 1,409. That's a 687% increase. Staff put in a request in with Google analytics to get some data about website hits, we will provide more information when available.
Item 6 – Economic Development Agreement with Del Mar Village Association (DMVA) 1) Does the 50k for DMVA include the DMVA paying for the quarterly power washing? It states that they are to oversee, coordinate, and implement quarterly program of power washing for Camino Del Mar etc. It doesn't say specifically that they pay for the service.
July 11, 2022 Items 3,5,6,10, &11
CITY COUNCL AGENDA QUESTIONS
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The quarterly downtown cleaning and power washing services provided through Urban Corps have been paid for through a generous donation from a member of the public separate from the $50K that is paid to the DMVA by the City annually for economic development services. Previously, the donation was made to the City, which the City then passed through to the DMVA. This year, the donation is being made directly to the DMVA.
2) One item in the DMVA agreement [page 14: Assist the City in developing a formal Bench Donation Program, including developing a contract, fees, procedures, and outreach to existing and new bench donors.] calls for DMVA to work on a bench donation program. We had a request about bench donations from Mr. Morrison at the last council meeting. Would it be appropriate to refer him to DMVA to work on this issue? Likewise, how about an update at a future meeting on DMVA contract task C "C. Sustainability Issues. Assist the City in implementing and communicating to the environmental sustainability efforts, programs and regulations to Del Mar Businesses to ensure business compliance with local, state, and federal laws and City goals." There are two separate bench programs in the City. One administered by the City’s Public Works Department, which includes benches in public parks and other public spaces, and the other is administered by the DMVA and is specific to the Downtown benches. The program that is discussed in the DMVA agreement is the one that they are administer. The recent comments by Mr. Morrison at the City Council meeting pertained to the Public Works administered bench program.
DMVA provides an annual report on activities related to their agreement with the City for economic development services, which would include any sustainability activities they engage in during the agreement period. However, if there is something specific the Council would like for the DMVA to report on, staff can arrange for that.
Item 10 – Agreement for As-Needed Affordable Housing Consulting Services 1) Is there a cap on the fees? The contract recites the hourly rates but I don't see a total "not to exceed" number. Section 4.1 of the Contract is labelled "Total Amount." but there is no total amount specified. Exhibit B that this section refers to just has the hourly rates. Don't we need a cap to make sure they stay within the budget? I note they are willing to negotiate fixed fees on a per assignment basis (Exhibit B)--do we plan to do that?
As noted above, typically, we do not have “not to exceed” amounts for as-needed consultants. As-needed professional service agreements have a specific rate schedule, and we use the consultant(s) on an as-needed basis consistent with funds that are included in the approved budget for the services. When an as-needed consultant is doing a larger work item such as the recent financial analysis provided by Keyser Marston Associates or conceptual planning study completed by Stephen Dalton Architects, we will issue a “task order” that is first approved by the City Council.
There may be some activities that the as-needed affordable housing consultant July 11, 2022 Items 3,5,6,10, &11
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engages in that warrants issuing a task order, such as work specific to the Fairgrounds.
2) Do our HCD contacts have an opinion on Whitaker or Fuentes? The firm's experience is extensive and impressive, but there is no mention of (1) Coastal Zone work with the CCC [Although Ms. Fuentes may have worked with the CCC when she worked for Oxnard, but I can't tell as not all of Oxnard is in the Coastal Zone] (2) Work with HCD (3) Work with SANDAG.
We did not solicit feedback from HCD regarding any of the firms that submitted proposals to provide affordable housing consulting services to the City. Typically, staff that complete the Housing Element and work closely with HCD are City planning staff, which in most cities are not the same staff that are working directly on affordable housing projects. In most cities, there is a completely different department or division within the Planning department that is responsible for the work associated with the development of affordable housing, so in most cases HCD staff will not have worked directly with the staff that are working on affordable housing. The situation in Del Mar is unique in that way.
Of all the firms interviewed, Whitaker by far had the most comprehensive experience in the area of affordable housing, which is where the City has the greatest need. While having coastal zone experience would be a plus, that isn’t where the City has the most need when taking into consideration the skills set of our internal staff team. We have a principal planner that is well-versed in the coastal zone and working with the Coastal Commission. What we recruited for is a firm that understands all aspects of affordable housing and how to tackle a complicated project such as the one the City is seeking to undertake at the Fairgrounds, which we believe Whitaker is well suited to do. 3) Is Ms Whitaker physically located in Texas? Is that a concern? Ms Fuentes is in Temecula, is that a concern?
The senior associate that will be the City’s primary contact for work to be done by Whitaker is Dena Fuentes, who is located in Temecula. Staff does not have any concerns about Ms. Fuentes’ location. Of the four firms that submitted proposals, only Ms. Fuentes and one other firm were located in close geographic proximity to Del Mar. 4) Exhibit A- Scope of Services does not state that the consultants will conduct community outreach. It is imperative that we find solutions to housing that have the least negative impact to our residents. We need them to feel part of the process particularly those that are near the site(s).
Yes, the Consultant will assist with community outreach and education efforts, which will be led by the City. These services were discussed as part of the RFQ and interview process, and mentioned in the agenda report. The City, with assistance from the Consultant, will absolutely be engaging the community regarding the Fairgrounds housing project and other housing related projects and programs to be implemented as part of the 6th Cycle Housing Element.
July 11, 2022 Items 3,5,6,10, &11
CITY COUNCL AGENDA QUESTIONS
JULY 11, 2022
Item 11 – 941 Development Agreement & Regulatory Housing Agreement Development Agreement
1) If the 2 lower income units are sold, and those qualified purchasers choose to rent instead of occupy, can they do that and must the rents also be affordable? The Regulatory Agreement (Section 1.13 and Section 2(a) – restricts the first sale to owner occupied and the initial Homeowner and all subsequent homeowners must enter into the Affordable Housing Deed Restriction which restricts the units to Owner Occupied.
Section 8.1 of the Affordable Housing Deed Restriction Agreement restates the prohibition, however, it does provide an exception allowing the Owner to request a waiver from the City to allow renting of the Property for a defined temporary period.
That Deed Restriction section additionally sets forth the procedures for granting that temporary approval, which include restricting the rental rate to at an “affordable housing cost” and do not guarantee the right to rent.
For the 2nd sale the staff report says: Residential use only, owner occupied. But there is nothing as to the 1st sale (in the staff report--haven't read the DA yet). Wouldn't it be preferable to allow rental at affordable rates? Affordable ownership is difficult to manage over time Telling owners they have to live there and can't rent is tough to enforce. Likewise, what if the qualified owner becomes unqualified--gets a new job, receives an inheritance, marries someone with big $$, etc. Pick your change of circumstances, any of which could cause loss of the affordability benefits well before the 55 years is up. Rental is much easier to manage and assure affordable occupancy for the 55 years. Why would we discourage or disallow rental?
The City Council and electorate approved Specific Plan for 941 Camino del Mar allows for the developer to seek a condominium form of ownership (SP Section 5.9.7), thus providing the developer a choice between offering the restricted units “for sale” or for rent. The developer has chosen the “for sale” option.
2) Should the Council recertify the Environmental Impact Report (EIR) as still adequate? I doubt there have been any substantial changes in circumstances that raise new environmental issue, or that alter those issues addressed four years ago that would trigger an EIR update. Wouldn't it be prudent recite that we took a look and everything is still up to date in case the ordinance, and/or DA are construed as a "project?" My memory is the "decision maker" has to certify the adequacy of the CEQA document every time it acts. Otherwise we are relying on a 4 year old certification with no comment as to whether or not it is still up to date.
July 11, 2022 Items 3,5,6,10, &11
CITY COUNCL AGENDA QUESTIONS
JULY 11, 2022
A Supplemental EIR was prepared in June 2018, in connection with the adoption of the Specific Plan and was relied upon for the approval of the project entitlements. The Specific Plan was a project specific plan and the Development Agreement is implementing the Specific Plan. No subsequent EIR is required unless there is substantial evidence to support a finding that there is:
a) New significant environmental effects or a substantial increase in the severity of the original environmental impacts.
b) Substantial change with respect to the circumstances related to the project. c) New information which demonstrates new impacts, more severe impacts or new mitigation measures. (Public Resources Code 21166 and CEQA Guidelines 15162)
The Ordinance acknowledges the SEIR was previously certified. If the Council wants to include on the record that there are no circumstances which would trigger additional environmental review that would be fine.
3) Section 2.03: Refers to compliance with the municipal code, Specific Plan, and other regulations, but no reference to Community Plan compliance--why not? The DA recitals and the approval ordinance specifically cite that the DA is consistent with the General Plan (Community Plan). Additionally, the Specific Plan and its approvals was determined to be consistent with the Community Plan. Section 2.03 specifically references the applicable law with respect to this Project. The Specific Plan is the plan which systematically implements, the Community Plan is the governing document for the Specific Plan and the project. Specific Plan sets forth zoning and code requirements applicable to the Project. 4) Does the staff know if the project will be all electric? My concern is that the DA will vest rights shortly before the council is likely to consider a building electrification ordinance that is under review by the Sustainability Advisory Committee (SAC) currently. Absent the DA, 941 would need to comply with a building electrification (BE) ordinance if one is adopted before they vest rights in the traditional way, with substantial construction in good faith reliance on a building permit. Would a BE ordinance fall within the exception of Section 203 D regarding construction standards?
Yes, Section 2.03(d) requires the Project to comply with all building codes in effect at the time building permits are submitted. If the BE is in effect at the time the developer submits its application for building permits it would be required to comply notwithstanding the DA.
5) Section 2.05 extends permits for 10 years. Section 2.06 requires the developer to proceed diligently “…within the timelines mutually agreed to by the Developer and the City". Do we have an agreement on timing? Section 2.06 provides that the parties acknowledge that the Developer shall have the right to develop the Project at such time as the Developer deems appropriate. The City has encouraged the Developer to move expeditiously and the 10 year term of July 11, 2022 Items 3,5,6,10, &11
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the DA is significantly less than normal Development Agreements which are generally 20 years or more. Once building permits are issued, the regulatory time periods allowed per the City’s building ordinance will apply.
6) Section 2.07, requires compliance with state law. The Coastal Act is state law- - will they need to comply with Coastal Commission directives? Section 4.01 requires the City to protect the developer's vested rights against City enactments--would that include our Local Coastal Program (LCP) changes that might be directed by the CCC? Same for state housing directives from the legislature or HCD--does the project need to comply?
Section 2.07 requires that the Project comply with all Federal and State law which would include the Coastal and State Housing Law. However, the project has received its project entitlements (Design Review Permits and Coastal Development Permit) and those are vested under the Agreement. See Section 3.14 which states that the DA shall not preclude the application to the Property and Project changes in law that are specifically mandated in State and Federal Law.
7) Section 3.06 calls for an annual $2k contribution to a shuttle should the city start one. There is no end date for this commitment specified. What do we have in mind? Will the HOA pay after the developer is gone? Given a shuttle seems unlikely, can we calculate present value and reallocate these funds? If a City shuttle system is implemented, this annual contribution for this EPB will be determined at that time.
8) Section 3.06 regarding Transient Occupancy Tax (TOT) on Short Term Rentals- -does this require code amendments to existing provisions? Won't Del Mar Municipal Code tax sections need updating?
Yes, modification may be necessary.
9) Section 4.02 right to rebuild: Does this exempt the project from the usual 50% rule to come up to current codes?
Section 4.02 requires rebuilding to be subject to “building codes existing at the time of such rebuilding.”
10)Section 4.05 Annual Review: This calls for annual review with the "developer." When the project is sold out, does this apply to an HOA as the successor to the developer? I don't see anything about an HOA or successors to the developer.
If not, who will do the annual review when the developer is gone? Note Section
8.09 expressly allows for the developer to sell out after construction: "Developer may transfer or assign all or any portion of its interests, rights or obligations under this Agreement, the Project Approvals or subsequent Approvals to third parties after completion of construction without City review and approval."
July 11, 2022 Items 3,5,6,10, &11
CITY COUNCL AGENDA QUESTIONS
JULY 11, 2022
The purpose of the Development Agreement is to vest the developer’s right to develop the Project under the rules and regulations existing at the time of the Development Agreement. The purpose of the annual review is to review compliance with the Development Agreement prior to and during the construction period. Once the project is completed and the Developer has fulfilled its Exceptional Benefits requirements no further developer obligations will be in effect. The affordability restrictions will become the obligations of the homeowners. Subsequent owners of the Project will still be subject the compliance with the Specific Plan regulations with respect to the operation of the Project.
11)Section 8.02--Developer to pay costs to defend City. How does this work after the project is sold out and the developer is gone? Does this fall on the HOA? This relates to challenges related to the City’s approval of the DA and the other Project Approvals and any Subsequent Approvals.
Development Agreement Exhibit
1) Section 1.13 defines "owner occupied" requiring on site presence 10 months of the year. As noted in my earlier comment, why? Wouldn't rental at affordable rates be preferred? Section 2a expressly forbids rental--why? "No leasing or renting, of any RESTRICTED UNIT shall be permitted."
As allowed by the Specific Plan, these are “for sale” units. The owner occupancy definition provides flexibility to accommodate life events such as illness, temporary job relocation, military deployment, or sabbatical.
2) Section 2a states in part: "If and to the extent the City acquires the RESTRICTED UNITS, then the City shall cause a use restriction to be recorded against the fee interest in the RESTRICTED UNITS acquired by the City to ensure the unit remains affordable to Qualified Households in perpetuity." The City should be able to sell or rent at market rates after the 55 years--why restricted in perpetuity?
Maintaining long-term affordability is a goal of the City and its Housing Element. 3) City approval for sale or transfer of the property or the project is required. But, sale of the living units as condos does not require city approval, right? City approval is required for change of ownership entire development prior to construction completion. No City approval is required for sale of the market-rate condos.
REGULATORY AGREEMENT
1) Section A allows the city to designate the type of affordable units to be purchased. Why have we selected 1 bedroom at the lower income level rather than the studio option at the very low level? Wouldn't a city purchase be at a July 11, 2022 Items 3,5,6,10, &11
CITY COUNCL AGENDA QUESTIONS
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lower price and help us meet our highest and most difficult to achieve housing need?
The unit designation is consistent with the approved Specific Plan and approved entitlements.
2) Granted, the sale price calculation needs to be done at the time the trigger is pulled, have we done a calculation of what the cost would be under current circumstances to buy at the low income and very low income, studio vs 1 bedroom options? The formula set out is clear, but complicated.
Due to the predetermination of the bedroom count per approved project entitlements, a comparative analysis has not be completed.
3) If a qualified first owner later sells, do they get to keep any of the property appreciation? Does the resale calculation of the Maximum Restricted Resale Price include any appreciation?
Subsequent sales include an escalator of the Area Median Income. This has in the past represented a 3 to 5% increase in the area median income. Higher income will contribute to a higher resale price. The Homebuyer will keep that appreciation but the sale must be to an income eligible household at an affordable price based on the formula.
4) Some of these terms seem harsh cumulatively: Restricted sales price, seller must require buyer to agree to restrictions, 6% sale fee to City; City calculates and certifies the sale price for its own purchase; seller has to pay off any mortgage--no transfer or assumption allowed; seller has to pay for inspections and repairs directed by City, seller can't pass any costs of sale to the buyer, City can declare "default" and then buy the property even over owner's objection (Section 9.4.), restrictions on mortgages and financing (Section 11). Given the seller stands to make little if any profit, is all this reasonable? Won't this return a seller to the same precarious financial circumstances that qualified them in the first place? Isn't home ownership supposed to help one rise above that? To me, these complications of sale are more reasons why affordable rentals, and not resales, are better.
These agreements were prepared by City Attorney office and Special Counsel Goldfarb and Lipman. The financing restrictions including in the Regulatory Agreement are typical/industry standard and were specifically recommended by Goldfarb and Lipman based upon their experience with affordable for-sale housing. 5) If a qualified owner becomes unqualified while living in the unit--new job, inheritance, marries a rich person, etc.--what happens? Are they forced to sell? This can be harsh--what if there is a family with kids in local schools, family members serving on City committees, or even on Council. Forced sale could be very disruptive if forced to sell at the Restricted Price the owner may well not be able to find replacement housing in the area they can afford, with job and other repercussions. Again, these complexities are part of the reason why affordable July 11, 2022 Items 3,5,6,10, &11
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rentals may be better for all involved than sales and resales. It's asking a lot to expect a council facing these kinds of repercussions on a resale to strictly enforce these requirements.
The City’s goal is to ensure long-term unit affordability. Technically, should a household no longer qualify as income eligible they will need to sell the property to an income eligible household. The City can cooperate with the owner to minimize the impact of a forced sale. These requirements are intended to ensure that the properties remain affordable.
July 11, 2022 Items 3,5,6,10, &11