STAFF REPORT
City of Lancaster
HA JPH 1
11/14/2023
JC
Date: November 14, 2023
To: Mayor Parris and City Council Members
Chair Kitty Szeto and Housing Authority Members
From: Larissa De La Cruz, Director – Community Development Chenin Dow, Assistant Director – Community Development, Housing & Economic Development
Christopher Aune, Housing Manager – Community Development, Housing & Economic Development
Subject: Consideration for approval of actions in connection with Lancaster Housing Authority-owned parcels related to compliance with the Surplus Land Act and a Disposition and Development Agreement with Sarah’s Care Home. Location:
Vacant parcels near the southwest corner of Kingtree Avenue and Avenue J-2 (APNs 3123-016-905 and -906)
Recommendations:
1. Adopt Resolution No. , declaring the following Housing Authority-owned property as “exempt surplus land” pursuant to Government Code Section 54221(f)(1)(F)(i): Vacant parcels near the southwest corner of Kingtree Avenue and Avenue J-2 (3123-016-905 and -906)
2. Adopt Resolution No. , approving the Disposition and Development Agreement, accepting the Health and Safety Code Section 33433 Report, and making certain findings pursuant to Health and Safety Code 33433.
3. Authorize the Executive Director, or his designee, to execute all related documents.
Fiscal Impact:
Approval of the proposed Disposition and Development Agreement (DDA) would provide revenue of $1,300,000.00 to the Low and Moderate-Income Housing Asset Fund (LMIHAF) account number 314-2200-4406.
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Background:
Sarah’s Care Home is an existing retirement and assisted living facility operated by longtime Lancaster resident and business owner, Sarah Shirley. Her existing facility offers six private rooms, with 24-hour support and care.
Sarah’s Care Home is now seeking to vastly expand its offerings to the Lancaster community. Recognizing the ongoing need for affordable housing for seniors, Ms. Shirley competed for, and was awarded, $28.5 million in grant funds from the California Department of Health Care Services (DHCS) and California Department of Social Services (CDSS) Community Care Expansion Program.
Ms. Shirley has proposed a 77-unit apartment complex, to be located on two parcels currently owned by the Lancaster Housing Authority near the southwest corner of Kingtree Avenue and Avenue J-2. The approximately 1.77-acre site will provide housing for seniors age 55+. The units will be deed-restricted to income-qualified tenants throughout the covenant period required by the grant, which is thirty (30) years.
The purchase price reflects the full appraised value of $1.3 million. Proceeds from the sale will flow to the Low and Moderate-Income Housing Asset Fund (LMIHAF), which is designated for the production and preservation of affordable housing.
Surplus Land Act Considerations
The California Surplus Land Act (Government Code 54220 et seq.) (“SLA”) governs the sale of surplus land. Land may be declared either “surplus land” or “exempt surplus land.” The SLA requires local agencies to comply with the SLA before taking action to dispose of surplus land.
The SLA includes an exemption for property that is developed as affordable housing that meets certain affordability levels pursuant to Government Code Section 37364. The housing to be developed pursuant to the DDA will meet the income requirements of Government Code Section 37364 and is therefore “exempt surplus land.”
The former Lancaster Redevelopment Agency (“Agency”) purchased properties throughout the City using low- and moderate-income housing funds in the early 2000s. The Lancaster Housing Authority (“Authority”) began the process of revitalization by demolishing dilapidated buildings, clearing the land, and preparing the site for an income-targeted housing community.
As the Authority plans to sell the parcels for the development of 100% affordable housing that complies with Government Code Section 37364, the proposed sale of the parcels meets the criteria for “exempt surplus land” pursuant to Government Code Section 54221(f)(1)(F).
Sarah’s Care Home initially reached out to staff regarding the purchase of the subject properties for the full appraised value of $1.3 million. The proposed DDA is an agreement between the Authority and the developer for the sale and development of the Site. The DDA governs the Developer’s right to develop the Project. The DDA also governs the Developer’s obligations with respect to the acquisition of the land, requirements for closing, and schedule of performance, and provides a legal framework for addressing default.
Under the DDA, Sarah’s Care Home will develop a minimum of sixty-five (65) units of affordable housing for seniors age 55+. Units will be provided in a multi-family apartment complex within 1 4
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the Lancaster Health District area. While precise Area Median Income (AMI) levels for the subject units are yet to be determined, the developer envisions that AMIs will range from 30% to 80%.
Sarah’s Care Home has engaged Duke Engineering to design the Project. The developer plans to break ground in 2024, with completion by 2026, in accordance with the terms of the grant.
Environmental Considerations
California Environmental Quality Act (CEQA): The designation of the property as exempt surplus does not have the potential for creating a significant effect on the environment and is therefore exempt from further review under CEQA pursuant to State CEQA Guidelines, 15060(c)(3), because it is not a project as defined by the CEQA Guidelines, Section 15378. The recommended actions for the DDA approval have been reviewed pursuant to the CEQA requirements under Title 14 of the California Code of Regulations (CCR) and the actions have been determined to be exempt per CEQA Guidelines §15312, §15332, and §15061(b)(3). National Environmental Policy Act (NEPA): There are no federal actions, therefore, NEPA does not apply. The development project envisioned by the DDA will be subject to, and in compliance with, all CEQA requirements.
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Attachments:
Resolution No.
Resolution No.
Exhibit A: Health and Safety Code 33433 Report
Disposition and Development Agreement