sr-091410-7e~~
City of
Santa Monica
Clt~/ COUIICII R@pOrt
City Council Meeting: September 14, 2010
Agenda Item: ~=E
To: Mayor and City Council
From: Marsha Jones Moutrie, City Attorney
Subject: Ordinance Amending the Plaza at the Arboretum Development Agreement
Address: 2200 Colorado
Owner: CSHV Arboretum,. LLC
Recommended Action
Staff recommends that the City Council introduce for first reading an Ordinance,
Attachment A, approving a modification to the Plaza at the Arboretum's Development
Agreement to make the City's current Affordable Housing Production Program
ordinance and Administrative Guidelines apply to that property.
Executive Summary
CSHV Arboretum, LLC ("CSHV") is the owner of the subject property and development
at 2200 Colorado Avenue. The prior owner and developer of the property entered into a
Development Agreement on December 16, 1987, and the Development Agreement was
amended on March 16, 1995. With the 1995 amendment, the Agreement authorized
the construction of an office building and multi-residential units, including 97 units of
affordable housing. Regarding the production and maintenance of affordable housing
units at the project, the Development Agreement as amended in 1995 states that Santa
Monica Municipal Code Chapter 9.28 applies to the project. That Chapter has since
been rescinded and replaced by Chapter 9.56. This proposed ordinance will make the
current Affordable Housing Production Program (AHPP) ordinance, Chapter 9.56,
applicable to the property, along with the City's AHPP Administrative Guidelines, and
will effectuate the settlement agreement in the City v. B/ackRock et al.
Discussion
A Development Agreement was approved- by the City Council on December 16, 1987
and-then amended on March 16, 1995 to allow the construction of an office building and
multi-residential units, including 97 units of affordable housing, on the subject property
at 2200 Colorado Avenue.
In February 2010, the City sued the current owner and managers of the property for
breaching the Development Agreement and related Deed Restriction that impose the
affordable housing requirement. As a result of negotiations in that lawsuit, City v
BlackRock et al, CSHV has agreed that the current AHPP ordinance and Administrative
Guidelines shall apply to the project. This action will bring one of Santa Monica's
largest sources of affordable housing in line with the City's current and more
comprehensive AHPP rules and procedures while also provide consistency in
monitoring and enforcement. However, the amended Development Agreement states
that the rescinded AHPP ordinance applies to the subject property. Accordingly, the
staff recommends replacing the sentence citing the old ordinance with one citing both
the current ordinance and the Administrative Guidelines implementing the current code
provisions.
CSHV and its co-defendant BlackRock negotiated for two statements regarding
adjustments to the current law's application to the project to be included in this
modification. The first statement provides that the current mix of low and moderate
income (45 low, 52 moderate) will remain the same. The second statement clarifies the
application of a specific Administrative Guideline on the process after a moderate
income tenant becomes ineligible so that fewer re-designations between affordable and
market rate units occur. The staff agrees with the inclusion of both statements and sees
no impact from these statements on monitoring and enforcement.
Commission Action
After conducting a public hearing on August 4, 2010, the Planning Commission voted
unanimously to recommend that the City Council approve the modification as
presented. In a separate vote, the Planning Commission voted to recommend that the
City create new fines for owners who violate the AHPP ordinance.
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Alternatives
In addition to the recommended action, the City Council could consider different
modifications or decline to make any modification to the development agreement.
Environmental Analysis
The City Council certified the Environmental Impact Report for this project prior to its
construction. No subsequent environmental analysis is required pursuant to CEQA
Guidelines Section 15162 since the proposed modification would not intensify any
project impact analyzed in the certified EIR. The project is already finished and this
modification impacts only the enforcement of affordable housing requirements.
Financial Impacts & Budget Actions
The recommendation presented in this report to recommend the Development
Agreement modification does not involve any financial impacts or budget actions.
Prepared. by: Gary Rhoades, Deputy City Attorney
Approved:
~~ ~~~
M rs a J e Moutrie
City Attor
Forwarded to Council:
Rod Gould
City Manager
Attachments:
A. Draft Ordinance amending the Plaza at Arboretum Development Agreement
B. Santa Monica's 2010 Maximum Income and Rent tables for affordable housing.
3
ATTACHMENT A
Draft Ordinance Amending the Plaza at the Arboretum
Development Agreement
City Council Meeting 9-14-10
Santa Monica, California
ORDINANCE NUMBER (CCS)
(City Council Series)
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SANTA MONICA
APPROVING THE DEVELOPMENT AGREEMENT AMENDMENT NUMBER
THREE BETWEEN THE CITY OF SANTA MONICA, A MUNICIPAL
CORPORATION, AND
CSHV ARBORETUM, LLC, A DELAWARE LIMITED LIABILITY COMPANY FOR
THE PLAZA AT THE ARBORETUM
THE CITY COUNCIL OF THE CITY OF SANTA MONICA DOES HEREBY
ORDAIN AS FOLLOWS:
SECTION 1. The Development Agreement Amendment Number Three
attached hereto as Exhibit 1 and incorporated herein by reference between the
City of Santa Monica, a municipal corporation, and CSHV ARBORETUM, LLC, a
Delaware limited liability company for Plaza at the Arboretum is hereby approved.
SECTION 2. Each and every term and condition of the Development
Agreement approved in Section 1 of this Ordinance shall be and is made a part of
the Santa Monica Municipal Code and any appendices thereto. The City Council
of the City of Santa Monica finds that public necessity, public convenience, and
general welfare require that any provision of the Santa Monica Municipal Code or
appendices thereto inconsistent with the provisions of this Development
Agreement, to the extent of such inconsistencies and no further, be repealed or
1
modified to that extent necessary to make fully effective the provisions of this
Development Agreement.
SECTION 3. Any provision of the Santa Monica Municipal Code or
appendices thereto., inconsistent with the provisions of this Ordinance, to the
extent of such inconsistencies and no further, are hereby repealed or modified to
that extent necessary to effect the provisions of this Ordinance.
SECTION 4. If any section, subsection, sentence, clause, or phrase of this
Ordinance is for any reason held to be invalid or unconstitutional by a decision of
any court of any competent jurisdiction, such decision shall not affect the validity
of the remaining portions of this Ordinance. The City Council hereby declares that
it would have passed this Ordinance, and each and every section, subsection,
sentence, clause, or phrase not declared invalid or unconstitutional without regard
to whether any portion of the Ordinance would be subsequently declared invalid or
unconstitutional.
SECTION 5. The Mayor shall sign and the City Clerk shall attest to the
passage of this Ordinance. The City Clerk shall cause the same to be published
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once in the official newspaper within 15 days after its adoption. This Ordinance
shall be effective 30 days from its adoption.
APPROVED AS TO FORM:
~~
MA S A~J ES MO TRIE
City ttor e
1 ~?/i.c.~~"
~;a~ Jl~~r! ra
RECORDING REQUESTED BY
CITY OF SANTA MONICA
WHEN RECORDED MAIL TO
City of Santa Monica
City Attorney's Office
1685 Main Sfreet, Third Floor
Santa Monica, CA 90401
Attention: Deputy City Attorney Gary Rhoades
Space Above Line For Recorders Use
No Recording Fee Required
Government Code Section 27383
AMENDMENT Ni.1MBER THREE
TO DEVELOPMENT AGREEMENT
THIS AMENDMENT NUMBER THREE TO DEVELOPMENT AGREEMENT
("Amendment Number Three"} is entered into as of this _ day of
2010 ("Effective Date"), by and between THE CITY OF SANTA MONICA, a municipal
corporation organized and existing pursuant to the laws of the State of California and the
Charter of the City of Santa Monica ("City") and CSHV ARBORETUM, LLC, a
Delaware limited liability company ("CSHV") with reference to the following facts:
A. CSHV is the owner of that certain real property ("Property") located in the
City of Santa Monica, California, which is more particularly described in Exhibit "A" to
this Third Amendment. Exhibit A is hereby incorporated by reference herein.
B. The City and the prior owner of the Property entered into a Development
Agreement dated as of December 16, 1987 pursuant to California Government Code
Sections 65864 et seq. and Santa Monica Municipal Code Chapter 9.48. The Original
Development Agreement was recorded on December 17, 1987, in the official records of
the County of Los Angeles as Instrument Number 87-1996737. The Development
Agreement was amended on March 16, 1995.
C. The Original Development Agreement and Second Amendment authorized
the construction of an office building and multi-residential units, including 97 units of
affordable housing, on the subject property.
D. Regarding the production and maintenance of affordable housing units at the
Project, the. Original Development Agreement and its amendment states that Santa
Monica Mixnicipal Code Section 9.28 applies to the Project. That section has since been
rescinded and replaced by Section 9.56.
E. The purpose of this Third Amendment is to make the current Affordable
Housing Production Program (AHPP) ordinance, Section 9.56, applicable to the Project..
F. The City's Planning Commission held a duly noticed public hearing on August
4, 2010 with respect to this Third Amendment and recommended that the City Council
adopt the proposed amendment.
G. In taking this action, the City Council has (a) specifically considered and
approved the impacts and benefits of the requested Amendment Number Three and has
concluded that this Amendment Number Three is consistent with the public health,
safety, and welfare of the residents of the City and the surrounding region and promotes
the goals, objectives, and policies of the General Plan, (b) deternuned that the City has
complied with all procedures required by the Development Agreement Statutes with
respect to this Amendment Number Three, and (c) duly authorized the City to enter into
this Amendment Number Three.
NOW, `THEREFORE, in consideration of the foregoing and the covenants and
conditions hereinafter set forth, the City and CSHV hereby agree as follows:
L Section 12(c) of the Original Development Agreement is hereby amended to
read as follows:
12. Sections 12 (c) and 12 (d) of Development Agreement. '''-° F '1,... ;.,,...°.. e,,,.+:,.....
"(C) Affordable Housing. T,,° ..F ~1,.,,,+°« n ~o ..F+1.° e,...+., a,r,.,.:,.,, r,r...,: ;....1
!',..i° .,Ff ,.+ ,.« +1... ,7..+,. 1.,.«..,.F .. ,.F .. L.;..1. °+t.,..l.°.7 1,°,-,.+.. ..., L'.,l.:l.;+ !~
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, ,
D«..; °..+ ;« 1:°....F««...,: A:«.. ,.il ..«:+° «°....;«.,A +.. i.° FF ...7,.1.1° +,. 1,... i.....~°1,°iA..
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(~9,....: ..:+..~+\ ,, n T1D ..L...11 1... ,,..+:N.,A +.. .. 1:,... f ,. F G/l o% ,.F +A ~,
1°--~ ~°°°m° ~~~~+° °° °~+° "(c) Affordable Housing The provisions of Chapter 9.56 of
the Santa Monica Municipal Code, a copy of which is attached hereto as Exhibit B,
and the related Administrative Guidelines for the Affordable Housing Production
Program, as in effect on the date of this amendment shall apply to the Project,
subject to the following modifications to specific sections:
(i) Modifying the application of Section 9.56.050(c) to the project, the Project
will continue to have 97 restricted units and the mix of low-income and moderate
Program Guidelines to the contrary;
(ii) Modifying the application of Section 6(c)(6)of the Administrative Guidelines
to the Project, any tenant of a restricted unit designated as a moderate income unit
whose income, based on the most. recently available data,- exceeds 140% of the
moderate-income limit, will be given none-year notice to vacate such restricted unit
and will be given the option to apply for residence in the next available market-rate
unit at the Project, during which one-year period such unit shall continue to
constitute a restricted unit for all purposes, and Owner will not be required to
convert such restricted unit into amarket-rate unit or to convert the next available
market-rate unit into a restricted unit."
All units required to be affordable to moderate-income households shall be provided on
site and the inclusionary unit base price shall be $80,000 per unit, adjusted for inflation
from the effective date of this Amendment, in the manner provided in Santa Monica
Municipal Code Section °.'~(e) 9.56.070(c).
[Section 12(d) remains unaltered by Amendment Number Three.]
2. Except as amended by this Amendment Number Three, the Amendment
Number Two to the Development Agreement shall remain in full force and effect in
accordance with its terms and conditions.
3. The parties hereto shall cause this Third Amendment to be recorded in the
Official Records of the Los Angeles County Recorder's Office.
IN WITNESS WHEREOF, the parties hereto have duly executed this agreement
as of the date and year first written above.
CITY OF SANTA MONICA,
a municipal corporation
By:
ROD GOULD
City Manager
ATTEST:
Maria Stewart
City Clerk
APPROVED AS TO FORM:
Mazsha Jones Moutrie
City Attorney
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EXHIBIT 1
E%HIBIT A~
LEGAL .DESCRIPTION OF THE :' PROPERTY
Parcel A: Lots 1`through 6 of Tract No. 49694, in the City of
Santa Monica, as per map recorded in Book 1175 Pages 37'
to 40 inclusive of. Maps in ,the Official Records of the
County of Los Angeles, State of California.
Parcel H: The Lessee's interest only in lease of the real '
property below, dated March 12, 1979 between Southern
Pacific Transportation Company as Lessor and Parker
Manufacturing Company as Lessee {Instrument No. 86-
184890), held by SoPac Properties, Inc., (formerly
known as, Anaheim Hills Development Corp.} following
February 11, 1986 assignment by Parker Manufacturing
Company to Anaheim Hills Development Corp. (Instrument
No. 66-184890}.
That portion of the right-of-way, 100.0 feet wide of
the Southern Pacific Railroad Company in the City of
Santa Monica, County of Los Angeles, State of
California, as recorded in Book 40, Page. 282 c€ deeds
in the Office of the County Recorder of.said county,
described as follows:
Beginning at the intersection of the curved
northwesterly line of said right-of-way, 100.0 feet
wide with the curved northwesterly line of the land
described in Parcel 3 of the final order of
Condemnation No. 496651,. filed July 23, 1945 'and. .
entered July 24, 1945, in judgment Book 1553, Page 27,
Superior Court, records of said State; said last
mentioned curve being concave southeasterly and having
a radius of 905.00 feet; a=-radial line of said curve to
said intersection bears. north 51 degrees, 34 minutes,
36 second west thence southwesterly and continuing
along said curve 94.25 feet through a central angle of
5 degrees, 58 minutes, 02 seconds to a point in a
curved line being concentric with and distant
southeasterly 40.00 feet measured radially from, said
northwesterly line of said right-of-way, 100.00. feet
wide; said last. described curve being concave
southeasterly and having a radius of 11,663.40 feet; a
radial line of said curve to said paint bears north 29
degrees, 38 minutes, 43 seconds west; thence
southwesterly 636.65 feet along said concentric curve
through a central angle of 3 degrees, 07 minutes, 39
seconds, to the northwesterly line of Twentieth Street,
70.00 feet wide as shown on the Map of Tract No. 9774
in said City and recorded in Book .140, Pages 64 and 65
of Maps, in the Office of the County Recorder of said
county; thence along said last described northeasterly
20709073--4/5/95
line north 44 degrees, 45 minutes, 25 second west,
40.88 feat to its intersection with said curved
northwesterly line of said right-of-wap, 100.0 feet
wide;. said last-mentioned curve being concave
southeasterly and having a radius of 11,703.40 feet; a
radial line of said curve to-said intersection bears
north 32 degrees, 48 minutes, 53 seconds west; thence
northeasteslp 732.79 feet along said curve, through a
central angle of 3 degrees; 35 minutes, 15 seconds to
the point of beginning.
20709073--4J5/95
EXHIBIT B
CHAPTER 9.56
(Copy of Chapter Intentionally Omitted from First
Reading Packet.)
ATTACHMENT B
AFFORDABILITY INCOME AND RENT TABLES
C~i~
2010 MAXIMUM INCOME AND RENT
~;~r o,
Santa Hnninn"
MAXIMUM ALLOWABLE INCOME (ANNUAL)
Household Very Low Moderate
Size (50%) Low (60%) Low (80%) (100%)
1 $29,000 $34,800 $46,400 $58,000
2 $33,150 $39,780 $53,000 $66,300
3 $37,300 $44,760 $59,650 $74,600
4 $41,400 $49,680 $66,250 $82,800
5 $44,750 $53,700 $71,550 $89,500
6 $48,050 $57,660 $76,850 $96,100
7 $51,350 $61,620 $82,150 $102,700
8 $54,650 $65,580 $87,450. $109,300
MAXIMUM ALLOWABLE RENTS (MONTHL
Very Low Moderate
Unit Type (50%) Low (60%) Low (80%) (100%)
0-Bdrm $725 $869 $1,159 $1,449
1-Bdrm $828 $994 $1,325 $1,656
2-Bdrm $983 $1,180 $1,573 $1,967
3-Bdrm $1,123 $1,348 $1,797 $2,246
4-Bdrm $1,268 $1,521 $2,029 $2,536
Rents: Income for 4-person household x Bdrm Adjustment x
/ 12.