CITY COUNCIL STAFF REPORT
Meeting Date: October 03, 2022
TO: THE HONORABLE MAYOR AND CITY COUNCILMEMBERS
SUBJECT: ADOPT A RESOLUTION NO. __ 22, AMENDING A PREVIOUSLY
APPROVED AFFORDABLE HOUSING DISPOSITION AND
DEVELOPMENT AGREEMENT (DDA) MODIFYING TIMES AND
DATES FOR PERFORMANCE RELATED TO 85 WOODSWORTH LANE
(APN 150-150-071)
SYNOPSIS
The City of Pleasant Hill (City) serves as the Housing Successor Agency (Housing Successor) to the former Pleasant Hill Redevelopment Agency (Former Agency). Upon the dissolution of redevelopment, the Former Agency transferred a parcel of vacant land located at 85 Woodsworth Lane (APN 150-150-071-2) (Property) to the Housing Successor Agency. The City and Habitat for Humanity (Habitat) entered into an Affordable Housing Disposition and Development Agreement (DDA) in February 2021, and now the parties desire to modify times or dates for performance in the DDA related to obtaining project entitlements, securing project financing, and closing escrow on the property.
DISCUSSION
Background
All California redevelopment agencies were dissolved effective February 1, 2012 through Assembly Bill x1 26. The City elected to serve as Housing Successor Agency to the Former Agency and is responsible for managing the Former Agency’s housing assets. Upon dissolution, the Former Agency transferred the 8,886-square-foot Property to the Housing Successor Agency.
State law requires the Housing Successor Agency either to sell or initiate affordable housing development on the Property by September 5, 2022. If the property is sold, all sales proceeds are restricted for use on affordable housing activities.
The City listed the Property for sale in November 2017, inviting proposals for affordable housing development or for the general sale of the property. The City selected a proposal from Habitat to negotiate an agreement.
On February 21, 2021, the City Council approved a DDA to sell the Property to Habitat for $10 and provide a forgivable $285,000 loan from the Housing Successor Agency’s Low and Moderate Income Housing Asset Fund to assist with the development of four ownership housing units affordable to low and moderate income households.
The City and Habitat desire to extend times or dates for certain performance milestones related to obtaining project entitlements, securing project financing, and closing escrow on the property due to delays in the entitlement process.
Analysis
Proposed Modifications
Exhibit C to the DDA includes a Schedule of Performance that identifies a deadline for securing Project Entitlements of March 31, 2022, and a deadline for securing Other Funding Commitments necessary to develop the Project of December 31, 2022. Section 5.4 of the DDA permits the City Manager to modify a time or date for performance of a particular task by 180 days at their reasonable discretion. The City Manager previously authorized extending the Project Entitlements and Other Funding Commitments deadlines by 180 days, or to September 27, 2022 and June 29, 2023, respectively. The City and Habitat signed a letter dated March 7, 2022, agreeing to the modifications.
Habitat has not been able to meet the original timeframe, as additional time was required to revise and finalize a project scope that minimized CEQA processing timing and related costs.
The project modifications necessitated a request for an extension of timeframes. As summarized in the table below,, the City and Habitat would like to further modify times and dates for performance to accommodate the current project process:
Item to be
Performed
Responsible
Party
DDA
Reference
Original
Time for
Performance
Amended
Time for
Performance
Proposed
Time for
Performance
Project
Entitlements
City and
Developer
2.5,
4.2.1.3,
4.2.1.8 March 31,
2022
September
27, 2022
September
27, 2023
Other
Funding
Commitments
Developer 4.2.1.4 December
31, 2022
June 29,
2023
December
31, 2023
Escrow
Closing Date
City,
Developer,
and Escrow
Holder
1.1.29,
4.6 5
th day
following
Escrow
Holder’s
receipt of
written
satisfaction
or waiver of
all conditions
5 th day
following
Escrow
Holder’s
receipt of
written
satisfaction
or waiver of
all
5 th day
following
Escrow
Holder’s
receipt of
written
satisfaction
or waiver of
all
precedent, no
later than
January 31,
2023
conditions
precedent,
no later than
July 31,
2023
conditions
precedent,
no later than
January 31,
2024
Habitat has made the following progress on the Project to date:
engaged architectural, civil, geotechnical, and environmental consultants completed site surveys, geotechnical reports, and Phase 1 environmental assessments engaged the environmental consultant to complete Phase 2 environmental assessments engaged City staff in preparing an entitlement package submittal to the City recorded loan documents
secured a Habitat Board resolution that commits to providing backstop funding Modifying the dates and times in the DDA will allow the City to continue its relationship with Habitat to develop the property with affordable housing and meet the City’s Housing Element and Regional Housing Needs Allocation (RHNA) goals.
FISCAL IMPACT
There is no immediate fiscal impact at this time. The DDA approved a $285,000 expenditure from the Housing Successor’s Low and Moderate Income Housing Asset Fund, which is restricted for use on affordable housing activities. This expense is included in the Housing Successor budget.
PUBLIC CONTACT
Public contact was made through posting of the City Council agenda on the City’s official notice bulletin board, in the City Clerk’s office, at the Pleasant Hill Library, and at the Pleasant Hill Police Department. The agenda and staff report are posted on the City’s web page and are available in the City Clerk’s office.
RECOMMENDED CITY COUNCIL ACTION
City staff recommends approving the resolution modifying times or dates for performance in the DDA.
ALTERNATIVES TO RECOMMENDED ACTION
1. Do not adopt the Resolution.
2. Continue the item to a later date, with direction provided to staff.
ATTACHMENT(S):
1. Proposed City Council Resolution
a. Exhibit 1 – Recorded Disposition and Development Agreement (DDA) for 85 Woodsworth Lane
b. Exhibit 2 – Proposed Modification to DDA Dates
2. Letter to Habitat for Humanity on Date Amendment
Prepared by: Troy Fujimoto, City Planner
Reviewed by: Ethan Bindernagel, Community Development Director Approved by: June Catalano, City Manager