SR-407-003-011
..
....
--
"...-
.1
Santa Monica, California, July 31, 1980
ICr-- tJtJ3- all
TO' Housing Authority
FROM City Staff
SUBJECT: Proposed Agreement With 3019 Third Street, ltd.
Background
On March 19, 1980, a Coastal Developnent Permit was approved for the construction
of twelve condominium units to be located at 3019 Third Street, Santa Monica.
Among the conditions incorporated in the approval ~~s a requirement that two
of the t"Jelve units be priced at an "affordable" level. Specifically, one unit
is to be priced at 2.5 times the median family income for a family of four persons
(at oresent the median income for four persons is $18,800), and the second afford-
able unIt is to be priced at 2.5 times 80~ of the median fa~ily incope for four persons.
Although the final sales prices will not be fixed until the receipt of the public
report ("\'Jhite slip") from the California Department of Real Estate, at current
~edian income levels the two 2-bedroom units would sell for $37,625 and $47,000
AddItionally, and separate from establishing maximum sales prices for the two
units, the Coastal permit also sets maximu~ incomes for eligible purchasers.
Maximum inCOMes are established by a formula defining a minimum allowable ratio
(25~) of total houSing costs (mortgage, association fees, taxes and insurance) to
gross monthly Income. In other words, the gross MOnthly income cannot exceed
a level which is four times the total monthly housing costs.
Utilizing the sale price estimates given above, current interest rates, and
projected association fees, the maxinum eligible annual income levels for the
two units would be approximately $21,500 and $26,200 whIch represent 115% and
l~O% of current Los Angeles County median inco~e levels.
,1
.
I
.
.
Housing Authority
-3-
Ju I y 31, 1980
6 Verify that the provisions of the Attachment to Grant Deed with
regard to subsequent sales and to cause the said Attachment to Grant Deed to
be ~ade a part of all subsequent grant deeds for the affordable units.
7. Provide reports on the progress of the project as May from time
to ti~e be reasonably required by Declarant or the COMMission.
8. Notify the Commission and Declarant in the event of the Inability
to carry out a sale of an affordable unit to an eligible person at least thirty
(30) days prior to the expiration of the option period.
The Housing Authority (City) would be reimbursed for administrative costs in
the amount of $300 for each transaction under this proposed agreement.
The City's Housing Com~ission reviewed the proposed Agreement at their ~eeting
of July 24, 1980. While they applauded the increase in the supply of housing
units, they expressed a concern with the process for selecting potential purchasers
for these units and others which might be forthcoming via the Coastal pernit process.
~t the conclusion of their deliberations, the HOUSIng COffi~ission moved a recom-
mendation that "The City establish an ongoing procedure for selecting occupants
for units set aside for low and moderate income households under inmediate and
future hous i ng proJ ects. II
RecorPl'lendation
It is reco~~ended that the Housing Authority approve the attached agreenent and
authorize the Chairman to execute the document
Prepared by' John Herner
JH sh
Attachment