SR-307-003-02
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City Council: 5/24/88
Santa Monica,
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MAY 2 4 1988
carifornia
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TO: Mayor and City Council
FROM: City staff
SUBJECT: Recommendations to (1) Select Community corporation of
Santa Monica as Developer of Affordable Housing at 1747
Fifteenth Street, and (2) Adopt Resolution Authorizing
the Sale of the Fifteenth street Property to Community
Corporation of Santa Monica
INTRODUCTION
This report recommends that the city Council:
(1) select
Community Corporation of Santa Monica to develop affordable
housing on the city-owned property at 1747 15th street; and (2)
adopt a resolution authorizing the sale of the Fifteenth street
property to community Corporation of santa Monica, without public
bidding, for this purpose.
BACKGROUND
The City acquired the unimproved real property at 1747 Fifteenth
street in May, 1971, for a cemetery expansion that was subse-
quently re-evaluated and cancelled.
The property is currently
used by the Cemetery Division of the Department of General Ser-
vices for dirt storage and equipment maintenance, but will become
surplus after various improvements are completed at Woodlawn
Cemetery in November of this year.
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,~
MAY 2 4 lQ88
On March 15, 1988, the City Council directed staff to prepare a
Request for Proposals for the development of affordable low in-
come housing on the Fifteenth street property. The following
sections of this report discuss the Request for Proposals, the
single proposal submitted, the staff recommendation that Communi-
ty Corporation of Santa Monica be selected to develop the proper-
ty, and the City policy regarding the funding of housing develop-
ment activities through the Community Development Program.
DISCUSSION
Request for Proposals
Pursuant to city Council direction, a Request for Proposals (RFP)
to develop affordable low income housing at 1747 Fifteenth street
was issued on March 28, 1988. The RFP required that applicants
be non-profit housing development corporations with experience in
developing and managing affordable housing. Up to $50,000 per
unit in "Greenwood" Development Agreement funds were made avail-
able by the RFP for the development of the housing.
Five RFP's were distributed directly to non-profit development
corporations on March 28, 1988, and an advertisement regarding
the availability of the RFP was placed in the Outlook on the same
day. Proposals were due by 4:00 p.m. on April 29, 1988.
Development proposal
One proposal was received in response to the RFP from Community
Corporation of Santa Monica (CCSM). CCSM proposes to develop
nine housing units on the property which would be affordable to
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very low, low, and moderate income households.
The unit mix
would consist of three one-bedroom, three two-bedroom, and three
three-bedroom units. The proposed project would be financed with
a combination of developer equity , private debt financing, and
"Greenwood" Development Agreement funds.
staff review of the CCSM proposal has determined that it meets
the requirements of the RFP as follows:
(1) The proposal complies with local development standards;
(2) The proposed project is compatible with surrounding
residential uses~
(3) The proposal is in compliance with the provisions of the
Affordable Housing Loan Program, including provisions
with respect to project size, rent levels, low and moder-
ate income benefit, and unit mix~
(4) The proposal includes Neighborhood Review, Affirmative
Marketing, and Management Plans which meet the Ci ty , s
requirements; and
(5) The proposal is complete, inclUding estimates of develop-
ment and operating costs and anticipated sources of
financing.
Based on the quality of the CCSM proposal, staff recommends that
CCSM be selected as developer of the Fifteenth street property.
Public Notice
Section 2508A of the Municipal Code, as amended by Ordinance No.
1125 (CCS), allows the sale of city-owned property without public
bidding if it is in the best interests of the city. The attached
resolution finds it in the best interests of the City to sell the
property to CCSM without public bidding based on the quality of
the proposal submitted by CCSM, CCSM's extensive experience in
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developing and managing affordable housing, and CCSM's demon-
strated ability to put together the financing required for the
project.
The Municipal Code requires that a public hearing be held prior
to the sale of City-owned property without public bidding. A
notice was therefore published in the Evening outlook on both May
14th and 21st, and posted in three conspicuous places on the
property itself, specifying the time and place of a public hear-
ing to be held on the proposed sale.
proposed Sale
Of the property's $281,000 sale price, $200,000 would be retained
as restricted cash in the Cemetery Fund to support perpetual care
maintenance of Woodlawn Cemetery. The remaining $81,000 will be
expended by the Cemetery Division to build new dirt storage bins,
and to use the dirt currently stored on the Fifteenth street
property to reconstruct Palm Avenue at the Cemetery.
The sale of the property will take place in approximately Decem-
ber of this year. Approval of the sale at this point in time
will provide CCSM with site control and allow it to proceed with
securing financing and planning for the site's development.
Funding of Housing Development Corporations
The City council also requested an analysis of the City policy of
funding a single non-profit housing development corporation to
carry out the City's programs and policies regarding the develop-
ment and management of affordable housing in Santa Monica.
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A major goal of the City's Community Development (CD) Program is
to ensure and increase long-term access to affordable housing
opportunities for low and moderate income residents in Santa
Monica. One way this goal is pursued is the funding of a non-
profit housing development corporation to develop, acquire,
rehabilitate, and manage affordable housing in santa Monica,
thereby creating and preserving this housing over the long term.
It is the City's policy to avoid duplication of services, and
this is embodied in the community Development Program. OVerlap-
ping and duplicative services are not cost-effective and most
often result in inefficient delivery of services. Given the
limited resources available for the development and management of
affordable housing, and the relatively small geographical area of
the City of Santa Monica, staff has determined that it is
economically inefficient to fund more than one non-profit
development corporation to pursue the city's housing goals.
Therefore, only a single non-profit development corporation which
demonstrates its superior ability to develop and manage afford-
able housing in Santa Monica is funded annually through the CD
Program.
CCSM has consistently been chosen by the City to provide afford-
able housing development and management services because of its
high level of technical expertise and extensive history of suc-
cessfully developing and managing affordable housing. CCSM was
formed by the Ocean Park Communi ty Organization and the pico
Neighborhood Association in 1983, with City assistance, to act as
a non-profit housing development corporation in santa Monica.
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Since that time, the City of Santa Monica and the Redevelopment
Agency of the City of Santa Monica have invested over $9,000,000
in affordable housing developments sponsored by CCSM. In addi-
tion, no other non-profit housing development corporation has
come forward which has the capacity or experience to fulfill the
City's housing program goals.
Staff recommends that the city Council continue the policy of
funding only one non-profit housing development corporation to
carry out the City's programs and policies regarding development
and management of affordable housing. The Community Development
Program recommends funding for CCSM with a workplan that reflects
the continued support of the development of affordable housing.
BUDGETARY/FINANCIAL IMPACT
As described herein the property at 1747 Fifteenth Street would
be sold to CCSM for its appraised value of $281,000. This sale
would increase the Cemetery's "Sale of Fixed Assets" revenue ac-
count, t37-913-180-000-000, by $281,000.
A portion of the sale proceeds, $81,000, would be used to finance
appropriation increases for the following purposes:
L $2,000 at account #37-500-641-000-741 for construction of
new dirt and compost storage bins; and
2. $79,000 at account #37-710-641-000-911 for removal of Myrtle
Avenue and reconstruction of Palm Avenue at the Cemetery.
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RECOMMENDATIONS
It is recommended that the City Council:
1. Select Community corporation of Santa Monica as developer of
the City-owned property at 1747 Fifteenth street~
2. Hold a public hearing on the proposed sale without public
bidding of the property at 1747 Fifteenth street to Community
Corporation of Santa Monica for the development of affordable
housing;
3. Adopt the attached resolution authorizing the sale of the
property at 1747 Fifteenth street to community corporation of
Santa Monica contingent upon receipt of a financing commit-
ment from a lender, receipt of all necessary planning approv-
als for the development of affordable housing on the site,
and execution of a Grant Deed;
4. Authorize the City Manager to execute any and all documents
required for the sale of the property as described herein;
5. Increase the revenue budget at account #37-913-180-000-000 by
$281,000: and
6. Appropriate $81,000 as follows:
A. $2,000 at account #37-500-641-000-741 for construction
of new dirt and compost storage bins; and
B. $79,000 at account #37-710-641-000-911 for removal of
Myrtle Avenue and reconstruction of Palm Avenue at the
Cemetery.
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Prepared by: Jack Gardner, Senior Development Analyst
Candy Rupp, Housinq proqram Manaqer
Department of Community & Economic Development
Attachments: 1) Resolution
2) Public Notice
:sale
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WHEREAS, the city desires to sell the Property to Community
Corporation of Santa Monica for the purpose of developing afford-
able housing; and
WHEREAS, the city has caused a notice of its intent to sell
the Property to be published in a local newspaper and posted
notice on the Property providing information on the date and time
of a public hearing, and
WHEREAS, the city council has held a public hearing at 7:30
p.m. on May 24, 1988 to hear from the public on the proposed sale
of the Property,
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA
DOES RESOLVE AS FOLLOWS:
SECTION 1. The City agrees to sell the Property to Communi-
ty corporation of Santa Monica subject to:
A. Receipt of a financing conuni tment from a lender for
development of affordable housing on the Property;
B. Receipt of all necessary City approvals for development
of affordable housing on the Property;
c. Compliance with the provisions of all applicable local
codes and ordinances pertaining to the development of affordable
housing; and
D. Execution of a Grant Deed between the city and Community
Corporation of santa Monica.
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SECTION 2. Municipal Code Section 2508A provides that the
sale of real property shall be by notice inviting bids unless the
City Council finds that advertising for bids would not be in the
best interests of the city. The City council finds that adver-
tising for bids would not be in the best interests of the city
because:
A. The city has determined that the development of afford-
able housing on the Property is of overriding benefit to the City
of Santa Monica and in the public interest;
B. The City has issued a Request for proposals for develop-
ment of affordable housing on the Property and has found the pro-
posal submitted by Community Corporation of Santa Monica to be
both feas~ble and acceptable; and
C. The city has found Community Corporation of Santa Monica
to be the most suitably qualified non-profit housing development
corporation, with experience in developing affordable housing, to
develop such housing on the Property.
SECTION 3. The City Clerk shall certify to the adoption of
this Resolution, and thenceforth and thereafter the same shall be
in full force and effect.
Approved as to form:
~~~
ROBERT M. MYERS U
City Attorney
:res99
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The Outlook
Saturday, May 14, 1988
EO 5-140
NOTICE OF A PUBUC HEARING '
TO BE RF.I.h BY nm CITY OF
SANTA MONICA ON '1'1II!; PRO-
POSED SAJ.R WhhOUT PUBLIC
BIDDING OF CITY OWNED
PROPERTY POR DEVELOp.
MENT OF HOUSING.
OFFICIAL NOTICE is bereby giv-
en that the City of Santa Mori1ca
will bold a public beanog on Tues-
day, May 24, 1ft88, to consider the
sale of City owned property, without
public bidding, to Community Cor-
poraUOD of santa Momca, a bOn--
prout eorporab.on, for the develop.
ment of affordable bousing on tbe
BIte at 1747 Fifteenth Street, BaDta
Monica, CA.
TIME AND PLACE of the PUB-
UC HEARING is as follows
TIME TUFSDAY, MAY 24, 1988,
7.30 P M.
PLACE COUNCIL CHAMBER,
CITY HALL, ROOM 213,. 1685 MAIN
S1'RI!;E"r, SANTA MONICA, CA
Any interested person may ap-
pear In person or by agent and be
heard Wnttep comments may be
addressed to_the Housing DiVlSlon at
the above address.
The meeting facihty is handicap
acceSllble If you have any speclal
needs such as Slgn.language inter-
pretwg, please contact Office of the
D1sabled at (213) 458-8701
THE CITY OF
SANTA MONICA
APPROVED AS TO FORM.
ROBERT M. MYERS,
CIty Attorney
Pub Mav 14-21-1988