City Council
Report
City Council Meeting: March 14, 2023
Agenda Item: 5.B
1 of 7
To: Mayor and City Council
From: Danielle Noble, Acting Director, Community Services Department, Housing and Human Services
Subject: Adoption of Resolution Declaring Surplus Properties Recommended Action
Staff recommends that the City Council:
1. Declare three City-owned properties located at 1217 Euclid Street (APN 4282- 004-900), 1211-1217 Fourteenth Street (APN 4282-003-900 and -901), and 1146 Sixteenth Street (APN 428-1005-900) as “exempt surplus land” as defined in Government Code Section 54221(f);
2. Adopt a Resolution declaring the City-owned properties at 1217 Euclid Street, 1211-1217 Fourteenth Street, and 1146 Sixteenth Street as exempt surplus land, and authorize the City Manager or his or her designee to take implementing actions necessary to comply with the Surplus Land Act (Government Code sections 54220 et seq.; and
3. Authorize the City Manager or his or her designee to submit the report of declared exempt surplus land as part of the Annual Report to the California Department of Housing and Community Development (HCD), in conformance with state law.
4. Adopt a finding of no possibility of significant effect on the environment pursuant to Section 15061(b)(3) (Common Sense Exemption) of the California Environmental Quality Act (CEQA) Guidelines and find that the issuance of a Request for Proposal for affordable housing on the City-owned properties at 1217 Euclid Street, 1211-1217 Fourteenth Street, and 1146 Sixteenth Street are consistent with the certified 6th Cycle Housing Element Environmental Impact Report.
Summary
Staff requests that Council adopt a resolution (Attachment A) declaring the City-owned properties at 1217 Euclid Street, 1211-1217 Fourteenth Street and 1146 Sixteenth Street as exempt surplus land because the City has plans to develop 100% affordable housing on those properties which meets the criteria for exempt surplus land under the 2 of 7
Surplus Land Act (SLA). These declarations are consistent with Council’s direction under the City’s adopted and certified 2021-2029 Housing Element, which identifies these sites as suitable to accommodate a portion of the City’s share of regional housing need for lower income households pursuant to State law.
On February 14, 2023, the City declared a Local Emergency on homelessness (Attachment B), which enables staff to expedite the development of affordable housing on City-owned land to meet the goals of the 2021-2029 Housing Element. Consistent with the Emergency Order and the Housing Element, the City will issue a request for proposals (RFP) for the City-owned properties at 1217 Euclid Street, 1211-1217 Fourteenth Street and 1146 Sixteenth Street. The purpose of the RFP is to select a development team qualified to develop affordable housing at all three sites. After evaluating proposals, staff will return to Council with a recommendation for the best development team.
Discussion
California Surplus Land Act
The California Surplus Land Act (Government Code 54220 et seq.) (SLA) governs the sale of surplus lands and requires local agencies to prioritize opportunities for certain uses including affordable housing development for any land the entity may sell or lease.
Surplus land may be declared either “surplus” or “exempt surplus” by the legislative body of the local agency as supported by written findings. Exempt surplus land does not have to follow the procedural requirements of the Surplus Land Act, and includes surplus land that is offered for open, competitive bid for a 100% affordable housing development. The law requires local agencies to report on the list of surplus lands in the General Plan Annual Progress Report, which is due April 1 of each year.
Effective January 1, 2020, Assembly Bill (AB) No. 1486 and AB No. 1255 amended the SLA to require local agencies to formally declare publicly-owned property not necessary for the local agency’s use, as surplus land or exempt surplus land before beginning the disposition process. Surplus land must follow a statutory noticing and negotiation period with certain designated entities, including eligible housing sponsors defined by the 3 of 7
California Department of Housing and Community Development (HCD). Exempt surplus land does not have to follow the procedural requirements of the Surplus Land Act. As provided in the SLA, exempt surplus land includes “surplus land that is put out to open, competitive bid for a housing development, which may have ancillary commercial ground floor uses, that restricts 100 percent of the residential units to persons and families of low or moderate income, with at least 75 percent of the residential units restricted to lower income households, as defined in Section 50079.5 of the Health and Safety Code, with an affordable sales price or an affordable rent, as defined in Sections 50052.5 or 50053 of the Health and Safety Code, for a minimum of 55 years for rental housing and 45 years for ownership housing, and in no event shall the maximum affordable sales price or rent level be higher than 20 percent below the median market rents or sales prices for the neighborhood in which the site is located.” The City’s pending RFP for 100% affordable housing development for the properties at 1217 Euclid Street, 1211-1217 Fourteenth Street and 1146 Sixteenth Street meets the criteria for exempt surplus land. The declaration of these properties as exempt surplus land will allow for the competitive RFP process to proceed in accordance with the SLA.
Housing Element Implementation and Homelessness State of Emergency On October 11, 2022, the City Council adopted the 2021-2029 Housing Element (Attachment C), a State-mandated plan for meeting the City’s share of regional housing needs. State law requires that the Housing Element include an inventory of land that demonstrates the City’s capacity to realistically accommodate new housing development at all income levels. To address the City’s shortfall of sites that are suitable for the creation of housing affordable to low-income households, the City committed to developing 100% affordable housing on City-owned parcels identified in Appendix F, Figure F-7 of the Housing Element (Attachment D). As specified in Housing Element Program 2.E (Attachment E), the City plans to issue at least three RFPs for the development of affordable housing on City-owned sites, the first of which would be issued by June 30, 2023.
4 of 7
On February 14, 2023, the City declared a Local Emergency on homelessness, which directs staff to streamline, accelerate, and expedite processes which implement Council-approved policy in the 2021-2029 Housing Element regarding City-owned land identified for affordable housing, such as issuing requests for proposals to identify development teams with demonstrated capacity to design, finance, construct, and operate affordable housing.
Next Steps
Consistent with the goals established in the Emergency Order and the Housing Element, the City will issue an RFP for the City-owned public parking lots at 1217 Euclid Street, 1211-1217 Fourteenth Street and 1146 Sixteenth Street. Staff has prioritized the three public surface parking lots near Wilshire Boulevard and Fourteenth Street for the first RFP based upon constraints to redevelopment in the near term of the other Cityowned sites. The Housing Element projects capacity for a total of 130 residences affordable to low- and very low-income households across the three public surface parking lots near Wilshire Boulevard and Fourteenth Street. Aerial photos and descriptions of the three sites near Wilshire Boulevard and Fourteenth Street, their projected housing capacity, and surrounding uses are provided in Attachment F.
The purpose of the RFP process is to evaluate and select a development team that is qualified to undertake the development of all three sites. The RFP will invite development teams to submit information about their qualifications, experience, and financial capacity to undertake and successfully complete affordable housing development. The RFP will also ask the teams to submit conceptual designs and service plans to illustrate the team’s overall approach and thought process toward achieving the City’s affordable housing objectives. Proposers would also be encouraged to consider and propose approaches to replacing the public parking among the sites.
After evaluating proposals, staff will return to Council for consideration and selection of a development team. After Council selection of a development team, the team would further refine the conceptual development in conjunction with input from community stakeholders through a public outreach process. Staff would return to Council again for 5 of 7
consideration and approval of an agreement involving a proposed development and the financial terms associated with use of the City-owned property.
Environmental Review
The declaration of the City-owned properties as surplus lands would have no possibility of significant effect on the environment, and therefore, is exempt pursuant to Section 15061(b)(3) (Common Sense Exemption) of the California Environmental Quality Act (CEQA) Guidelines. Additionally, the issuance of a RFP for development of affordable housing on City-owned properties located near Wilshire Boulevard and 14th Street was analyzed as part of the 2021-2029 6th Cycle Housing Element Environmental Impact Report (EIR) [SCH No. 20212269242021] that was certified by Council on October 12, 2021, with an Addendum to the EIR approved on October 11, 2022. This authorization of an RFP implements a portion of that 6th Cycle Housing Element project.
An analysis has been performed pursuant to CEQA Guidelines §15162 to determine whether subsequent environmental review is required for the issuance of the RFP.
Based upon this analysis, the following findings are made to support the determination that no subsequent environmental review is required:
1) No substantial changes are proposed in the project which will require major revisions of the previous EIR and Addendum due to the involvement of new significant environmental effects or a substantial increase in the severity of previously identified significant effects. In this case, there are no changes to the project.
2) No substantial changes occur with respect to the circumstances under which the project is undertaken which will require major revisions of the previous addendum due to the involvement of new significant environmental effects or a substantial increase in the severity of previously identified significant effects. In this case, no substantial changes have occurred.
6 of 7
3) There is no new information, which was not known and could not have been known at the time of the previous EIR and Addendum that the project will have significant effect not discussed in the EIR and Addendum.
Based upon these findings, it has been determined that no further environmental documentation is required for this project.
Past Council Actions
10/11/2022
(Attachment C)
City Council adopted 2021-2029 Housing Element
2/14/2023
(Attachment B)
City Council declaration of Local Emergency on Homelessness Financial Impacts and Budget Actions
There is no immediate financial impact or budget action necessary as a result of the recommended action. Staff will return to Council if specific budget actions are required in the future. Staff estimates that the potential parking revenue loss due to the closure of Parking Lots 7, 8 and 12 would be approximately $0.2 million annually. Following receipt and review of proposals, staff would return to Council with recommendations for the selection of an affordable housing development team, terms for disposition of City land, and a possible Housing Trust Fund loan.
Prepared By: Ayala Scott, Senior Development Analyst
Approved Forwarded to Council
Attachments:
A. Proposed Resolution
7 of 7
B. February 14, 2023 Staff Report (Web Link)
C. October 11, 2022 Staff Report (Web Link)
D. Housing Element Appendix F, Figure F-7
E. Housing Element Program 2.E
F. Aerial images and site descriptions for Euclid, 14th St. and 16th St. sites