RDA RES 2004-012 RESOLUTION NO. RDA 2004-12
A RESOLUTION OF THE RANCHO PALOS VERDES REDEVELOPMENT
AGENCY ADOPTING AN IMPLEMENTATION PLAN FOR PROJECT AREA NO. 1.
THE RANCHO PALOS VERDES REDEVELOPMENT AGENCY HEREBY FINDS,
DETERMINES, RESOLVES AND ORDERS AS FOLLOWS:
Section 1: The Redevelopment Plan for Project Area No. 1 of the Rancho Palos
Verdes Redevelopment Agency(the"Project Area")was approved and adopted by Ordinance
No. 190 of the City Council of the City of Rancho Palos Verdes on November 27, 1984.
Section 2: Health and Safety Code Section 33490 requires that each redevelopment
agency that has adopted a redevelopment plan prior to December 31, 1993, adopt, after a
public hearing, an Implementation Plan on or before December 31, 1994 and each five years
thereafter, containing the specific goals and objectives of the agency for the project area,the
specific programs (including potential projects), and estimated expenditures proposed to be
made during the next five years, and an explanation of how the goals and objectives,
programs and expenditures will eliminate blight within the project area and implement the low
and moderate income housing requirements of the Community Redevelopment Law(Health
and Safety Code Section 33000, et seq.).
Section 3: The Agency adopted an initial Implementation Plan for the Project Area
on December 6, 1994, and an updated Implementation Plan on December 7, 1999. Both
implementation plans are on file in the office of the City Clerk.
Section 4: The Agency has prepared a new Implementation Plan for the Project
Area, attached hereto as Exhibit A and incorporated herein by reference(the"Implementation
Plan"), in accordance with the requirements of Health and Safety Code Section 33490.
Section 5: On December 7, 2004, the Agency held a duly noticed public hearing on
the proposed adoption of the Implementation Plan at which time all persons desiring to
comment on or ask questions concerning the Implementation Plan were given the opportunity
to do so. Prior to the public hearing on the Implementation Plan, copies of the
Implementation Plan were available for public inspection in the office of the City Clerk.
Section 6: The Agency has reviewed and considered all written and oral comments,
questions and concerns regarding the Implementation Plan received prior toand at the public
hearing on the Implementation Plan.
Section 7: The Agency hereby adopts the Implementation Plan as the
implementation plan for the Project Area pursuant to the requirements of Health and Safety
Code Section 33490.
Section 8: The Implementation Plan may be amended from time to time after a
public hearing on the proposed amendment.
Section 9: Adoption of the Implementation Plan does not constitute an approval of
any specific program, project or expenditure and does not constitute a project within the
meaning of Section 21000 of the Public Resources Code.
Section 10: The Agency hereby directs that the Implementation Plan remain on file in
the office of the City Clerk and be open to public inspection.
PASSED, APPROVED AND ADOPTED this 7th day of December, 2004.
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Chair
Attest:
Secretary
State of California )
County of Los Angeles ) ss
City of Rancho Palos Verdes )
I, Jo Purcell, Secretary to the Rancho Palos Verdes Redevelopment Agency, hereby certify
that the above Resolution No. RDA 2004-12 was duly and regularly passed and adopted by
the said Agency at a regular meeting held on December 7, 2004.
• (P, / / /o■
Secretary
Resolution No. RDA 2004-12
Page 2 of 2
Resolution RDA 2004-12
Exhibit "A"
IMPLEMENTATION PLAN
For The
RANCHO PALOS VERDES REDEVELOPMENT AGENCY
January 1, 2005 through December 31, 2009
Resolution No. RDA 2004-12, Adopted on December 7, 2004
Prepared for:
Rancho Palos Verdes Redevelopment Agency
30940 Hawthorne Boulevard
Rancho Palos Verdes, CA 90275
Resolution No. RDA 2004-12
Exhibit"A"
TABLE OF CONTENTS
I. Legislative Requirements 1
II. Background 2
III. Identified Conditions of Blight 3
IV. Long Term Objectives of the Redevelopment Plan 3
V. Five Year Goals for the Project Area 3
VI. Implementation Activities to Achieve Five Year Goals 4
VII. Relationship Between Implementation Activities
and Redevelopment Plan Findings of Blight 5
VIII. Inclusionary Et Replacement Housing Requirements 5
IX. Replacement Housing Plan 11
X. Inclusionary Housing Plan 11
XI. Housing Set-Aside Requirements 12
XII. Long Term Housing Goals and Policies 15
XIII. Five-Year Housing Goals 16
XIV. Financial Assistance/Developer Participation 20
Appendix A
Attachment 1-A List of Specific Programs and Estimated Expenditures
Attachment 1-B Map of Project Area
Resolution No. RDA 2004-12
Exhibit"A"
IMPLEMENTATION PLAN FOR
THE RANCHO PALOS VERDES REDEVELOPMENT AGENCY
I. LEGISLATIVE REQUIREMENTS
Assembly Bill 1290, also known as the Community Redevelopment Law Reform Act
of 1993, effective January 1, 1994, enacted numerous revisions to the California
Community Redevelopment Law including a requirement for the adoption of an
implementation plan. The California Community Redevelopment Law, Health and
Safety Code Section 33490 now requires that each redevelopment agency adopt
an implementation plan prior to December 31, 1994 and each five years
thereafter for each redevelopment project area.
The implementation plan must contain the specific goals and objectives of the
redevelopment agency for each project area; the specific programs including
potential programs and estimated expenditures proposed to be made during the
five year period of the plan; and an explanation of how the goals and objectives,
potential projects and estimated expenditures will eliminate blight within the
project area. The plan must also describe the agency's plans to implement the
housing related requirements of Code Sections 33334.2, 33334.4, and 33413.
The implementation plan must contain, for each year of the five-year period, an
annual housing program, including estimates of the number of housing units
destroyed and/or removed, and the number of units developed, rehabilitated,
price restricted and/or otherwise assisted. Further, the implementation plan
must describe the agency's plans for the use of the annual deposits in the low and
moderate income housing fund during each of the next five years.
Additionally, if the implementation plan contains a project or projects for which
the redevelopment agency is providing financial assistance, and which will result
in the destruction or removal of dwelling units housing persons and families of low
or moderate income, the implementation plan must identify proposed locations
suitable for replacement housing units.
In accordance with Code Section 33490(c), the agency must conduct a public
hearing and hear testimony of all interested parties relative to the redevelopment
plan and the implementation plan at least once within the five-year term of the
implementation plan. The hearing must take place no earlier than two years and
no later than three years after adoption of the implementation plan.
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Notice of public hearings conducted regarding the adoption of the
implementation plan must be published pursuant to Code Section 6063 of
the Government Code and posted in at least four permanent places within
the project area for a period of three weeks. Publication and posting must
be completed not less than 10 days prior to the date set for hearing.
II. BACKGROUND
Redevelopment Plan Adoption
On November 27, 1984, the Rancho Palos Verdes Redevelopment Agency
adopted a Redevelopment Plan for Project Area Number One.
Project Area Description
The Project Area includes 1,240 acres, predominantly in single-family
residential use with small amounts of institutional, recreational and
agricultural uses. The majority of the development within the Project
Area occurred prior to 1962.
The Project Area includes the Abalone Cove, Portuguese Bend, and
Klondike Canyon landslides and adjoining areas and roughly corresponds to
the City's Landslide Moratorium Area.
Implementation Plan
This Implementation Plan will meet the legislative requirements described
in Section I as they relate to the Rancho Palos Verdes Redevelopment
Plan. Specifically, the Implementation Plan will:
• Describe the specific goals and objectives of the Redevelopment
Agency for the project area.
• Identify the programs including potential projects and estimated
expenditures proposed to be made during the five-year period of
the Implementation Plan.
• Explain that the goals and objectives will eliminate blight from
within the project area; and
• Describe the Redevelopment Agency's plans to implement the
housing related requirements of Community Redevelopment Law
Code Sections 33334.2, 33334.4, and 33413.
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III. IDENTIFIED CONDITIONS OF BLIGHT
The Redevelopment Agency adopted the "Redevelopment Plan for Project
Area Number One" on November 27, 1984 after identifying blighted
conditions within the project area generally described as follows:
Continuous earth movement has resulted in blighted conditions in the
Project Area.
Palos Verdes Drive South, the major circulation element in the area, is in
perpetual need of repair, as are other infrastructure in the Project Area.
The land formation in the Project Area is fractured with steep scarps and
rifts, and homes are set at odd angles.
IV. LONG TERM OBJECTIVES OF THE REDEVELOPMENT PLAN
The Project Area includes a number of conditions that are defined in the
California Community Redevelopment Law as characteristics of blight. The
objective of the Redevelopment Plan is to eliminate such conditions of
blight by providing needed public improvements, controlling excessive
moisture in the slide area, stabilizing earth movement and repairing
damage resulting from landslides in the Project Area. The Redevelopment
Plan contains the following general objectives:
(1) Eliminate physical and economic blight in the Project Area through the
stabilization of soils conditions leading to hazardous landslides.
(2) Prevent the recurrence of blighting conditions in the Project Area
V. FIVE YEAR GOALS FOR THE PROJECT AREA
The priority short term (five year) goals for the Project Area that are
intended to guide the City's redevelopment program from January 1, 2005,
through December 31, 2009, are shown below. It is anticipated that the
projects and activities undertaken by the Redevelopment Agency (except
those resulting from emergency situations) will meet these goals.
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(1) Provide a broad range of public infrastructure improvements to
ameliorate effects of unstable geologic conditions and to abate the
geologic hazards, which currently exist in the Project Area.
(2) Enhance the public safety and welfare by providing improved
community services. This goal will be achieved through the design and
construction of needed public facilities and utilities.
(3) Preserve, improve and expand housing opportunities for low and
moderate income residents. This goal will be achieved either through
the rehabilitation, repair, and replacement of currently marginal or
substandard residential units, providing subsidies or other support to
qualified low- and moderate-income households utilizing suitable
existing housing resources and/or encouraging the development of new
affordable housing resources.
VI. IMPLEMENTATION ACTIVITIES TO ACHIEVE FIVE YEAR GOALS
To achieve the five-year redevelopment goals, the Redevelopment Agency
proposes to undertake the following blight elimination, community
improvement, and affordable housing programs.
• Design and construct needed public improvements. Typical
examples include, but are not limited to dewatering wells,
construction of pipelines, storm drains, culverts, pipes and
channels, revetments, relocation and/or reconstruction of public
streets serving the Project Area and installation or relocation of
utilities including debris basins, channel lining and storm drain
improvements.
• Provide improved community services. Typical examples include,
but are not limited to the improvement of public streets, utilities,
parks and open spaces and the control of excessive moisture in the
Project Area that creates destabilization of soils leading to
hazardous landslides.
• Preserve, improve and expand housing opportunities for low and
moderate income residents.
Typical examples include, but are not limited to: the replacement
or repair of marginal or substandard dwelling units, providing
financial subsidies to qualified low and moderate income
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households, and the implementation of financial assistance
programs to reduce land, site development and/or construction
costs to facilitate the development of low and moderate income
housing.
Specific projects proposed for the next five years to fulfill the goals
expressed above are described in Attachment 1-A
VII. RELATIONSHIP BETWEEN IMPLEMENTATION ACTIVITIES AND THE FINDINGS
OF BLIGHT
The preliminary list of redevelopment program activities scheduled for the
next five years are shown in Attachment 1-A. All of the program activities
scheduled will eliminate blighting conditions by:
(1) Stabilizing soils conditions in the area preventing further erosion and
instability;
(2) Improving infrastructure that will prevent the recurrence of blighting
conditions; and
(3) Improving public streets, utilities, parks and open spaces.
VIII. INCLUSIONARY AND REPLACEMENT HOUSING REQUIREMENTS
Legislative Requirements
The Community Redevelopment Law requires that an annual housing
program be adopted as a part of the mandated implementation plan. The
implementation plan must include the number of housing units developed,
substantially rehabilitated, price-restricted, otherwise assisted, or
destroyed. The implementation plan must also describe the Agency's plans
for using annual deposits in the low and moderate income housing fund.
If the implementation plan contains a project that will result in the
destruction or removal of dwelling units that will have to be replaced
pursuant to Community Redevelopment Law (CRL) Code Section 33413, the
implementation plan shall identify proposed locations suitable for those
replacement dwelling units.
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CRL Code Section 33413 states:
(a) Whenever dwelling units housing persons and families of low
or moderate income are destroyed or removed from the low
and moderate income housing market as part of a
redevelopment project which is subject to a written
agreement with the agency or where financial assistance has
been provided by the agency, the agency shall, within four
years of the destruction or removal, substantially
rehabilitate, develop, or construct, or cause to be
substantially rehabilitated, developed, or constructed, for
rental or sale to persons and families of low or moderate
income, replacement dwelling units which have an equal or
greater number of bedrooms as those destroyed or removed
units at affordable housing cost within the territorial
jurisdiction of the agency. When dwelling units are
destroyed or removed after September 1, 1989, 75 percent of
the replacement dwelling units shall replace dwelling units
available at affordable housing cost in the same or a lower
income level of very low income households, lower income
households, and persons and families of low and moderate
income, as the persons displaced from those destroyed or
removed units. When developing units that are destroyed or
removed on or after January 1, 2002, 100 percent of the
replacement dwelling units shall be available at affordable
housing cost to persons in the same or lower income category
(low, very low or moderate) as the persons displaced from
those destroyed or removed units.
(b) (1) Prior to the term limit on the effectiveness of the
redevelopment plan, at least 30 percent of all new
and substantially rehabilitated dwelling units
developed by an agency shall be available at
affordable housing cost and occupied by persons and
families of low or moderate income. Not less than 50
percent of the dwelling units required to be available
at affordable housing cost to persons and families of
low or moderate income shall be available at
affordable housing cost to, and occupied by, very low
income households.
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(2) Prior to the term limit of the effectiveness of the
redevelopment plan, at least 15 percent of all new
and substantially rehabilitated dwelling units
developed within a project area under the jurisdiction
of an agency by public or private entities or persons
other than the agency shall be available at affordable
housing cost to and occupied by persons and families
of low or moderate income. Not less than 40 percent
of the dwelling units required to be available at
affordable housing cost to and occupied by persons
and families of low or moderate income shall be
available at affordable housing cost to and occupied
by very low income households.
Additional Inclusionary Housing Requirements
The agency's inclusionary housing requirements are required to be met
every ten years. If the requirements are not met within the applicable
ten-year period, the agency must fulfill its inclusionary housing
requirements on an annual basis until the requirements for the ten year
period are met. Further, if the agency exceeds its inclusionary housing
goals during a given ten year period, the excess housing units can be
counted towards inclusionary housing goals in the subsequent ten year
period.
For example, if 100 new housing units are developed or substantially
rehabilitated in a project area within ten years of the initial
implementation plan by entities other than the redevelopment agency, 15
of those units must be affordable to low or moderate income households
(of which 6 must be affordable to very low income households). If more
than 15 units are developed or substantially rehabilitated as units
affordable to low and moderate income households during this ten-year
period, the affordable units in excess of 15 may be counted toward the
agency's requirements for the next ten-year period. However, if fewer
than 15 units are affordable to low or moderate income households at the
end of the ten-year period, the agency must meet its production goals on
an annual basis until the requirements for the ten-year period are met.
Affordability Requirements
Housing costs for low and moderate income housing developed pursuant to
CRL Section 33413 must be affordable to persons and households whose
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income do not exceed 120 percent of the area median family income. For
purposes of the Implementation Plan, the following income limits are used:
• Very Low Income (0-50 percent of area median family income)
• Low Income (51-80 percent of area median family income)
• Moderate Income (81-120 percent of area median family income)
The area median family income limits are adjusted for household size, with
smaller households having lower income limits. The 2004 HUD median
family income adjusted for a four-person household in Los Angeles County
is $55,100. Thus by definition, 2004 maximum income is $29,750 for a very
low income four-person household, $47,600 for a lower income four-person
family and $66,100 for a four-person moderate income family for
jurisdictions in Los Angeles County.
TABLE 2
DEPARTMENT OF HOUSING Et COMMUNITY DEVELOPMENT - INCOME LIMITS
Standard 1 2 3 4 5 6 7 8
Very Low 20,850 23,800 26,800 29,750 32,150 34,500 36,900 39.250
Income
Lower 33,300 38,100 42,850 47,600 51,400 55,200 59,000 62,850
Income
Median 38,550 44,100 49,600 55,100 59,500 63,900 68,300 72,750
Income
Moderate 46,250 52,900 59,500 66,100 71,400 76,700 81,950 87,250
Income
TABLE 3
AFFORDABLE HOUSING COSTS
The second step in determining compliance with affordable housing requirements
is determining whether the total housing costs payable by the household are
within allowable amounts. The following table illustrates the Community
Redevelopment Law affordable housing costs requirements.
Income Levels ") Owner Costs Renter Costs
Very Low (0-50%) 30% of 50% of adj. 30% of 50% of adj. AMI.
Low _ 30% of 70% of adj. 30% of 60% of adj. AMI2 11
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(51-70%)
(70-80%) Option:
Max: 30% of gross hh inc.0)
(61-80%) Option:
Max: 30% of gross hh i nc.0)
Moderate Min: 28% of gross hh inc.(1) 30% of 110% of adj. AMI(2)
(81-120%) Max: 35% of 110% of adj. AMI
(111-120%) Option: Option:
Max: 35% of gross hh inc.(,) Max: 30% of gross hh inc.(,)
(1) Household income (hh inc.) levels relative to area median income.
(2) Area Median Income (AMI) adjusted for family size appropriate for the unit.
Following are examples of the application of affordable housing cost
requirements:
AFFORDABLE HOUSING EXAMPLE FORA VERY LOW INCOME FAMILY PURCHASING A 3-BEDROOM HOUSE
A very low income family buying a 3-bedroom house could not have monthly
housing payments exceeding $688.75. The Community Redevelopment Law
requires that the following be included as estimates for purposes of determining
what the monthly housing payment is:
• Principal and interest payments on the mortgage loan, including
rehabilitation loans.
• Mortgage loan insurance fees.
• Property taxes and assessments.
• Fire and casualty insurance.
• Property maintenance and repairs.
• A reasonable allowance for utilities (including garbage collection, sewer,
water, electricity, gas and other fuels, but not telephone service). Such an
allowance shall take into consideration the cost of an adequate level of
service.
• Homeowner association fees.
• Space rent, if the housing unit is on rented land.
AFFORDABLE HOUSING EXAMPLE FOR A VERY LOW INCOME FAMILY RENTING A 3-BEDROOM UNIT
A very low income family renting a 3-bedroom house could not have monthly
y y
rental payments exceeding $688.75. The Community Redevelopment Law
requires that the following be included as estimates for purposes of determining
what the monthly rental payment is:
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• Use and occupancy of a housing unit and land and facilities associated
therewith.
• Any separately charged fees or service charges assessed by the lessor which
are required of all tenants, other than security deposits.
• A reasonable allowance for utilities not included in the above costs,
including garbage collection, sewer, water, electricity, gas and other
heating, cooking, and refrigeration fuels. Utilities do not include
telephone service. Such an allowance shall take into consideration the
cost of an adequate level of service.
• Possessory interest taxes or other fees or charges assessed for use of the
land and facilities associated therewith by a public or private entity other
than the lessor.
Duration of Affordability
CRL Code Section 33413(c) states, in part, "The agency shall require that
the aggregate number of dwelling units rehabilitated, developed,
constructed or price-restricted pursuant to subdivision (a) or (b) remain
available at affordable housing cost to and occupied by persons and
families of low income, moderate income, and very low income
households, respectively, for the longest feasible time, as determined by
the agency, but for not less than 55 years for rental units and 45 years for
homeownership units. The agency may permit sales of owner-occupied
units prior to the expiration of the 45-year period established by the
agency for a price in excess of that otherwise permitted under this
subdivision pursuant to an adopted program that protects the agency's
investment of moneys from the Low and Moderate Income Housing Fund. If
land on which the dwelling units required by this section are located is
deleted from the project area, the agency shall continue to require that
those units remain affordable as specified in this subdivision."
CRL Code Section 33413(g) adds that "Longest feasible time as used in this
section, includes but is not limited to, unlimited duration."
Due to amendments to the Law, the time limits on affordability in CRL
Code Section 33413 (c) and (g) are now the same as the general
affordability criteria for agency-assisted units set forth in CRL Code Section
33334.3(f).
CRL Code Section 33413(b)(2)(C) adds that "long-term affordability
covenants purchased or otherwise acquired pursuant to subparagraph (B)
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shall be required to be maintained on dwelling units at affordable housing
costs for not less than 55 years for rental units and 45 years for
homeownership units."
IX. REPLACEMENT HOUSING PLAN
Whenever dwelling units housing persons and families of low or moderate
income are destroyed or removed from the low and moderate income
housing market as part of a redevelopment project which is subject to a
written agreement with the agency or where financial assistance has been
provided by the agency, the agency shall, within four years of the
destruction or removal, substantially rehabilitate, develop, or construct, or
cause to be substantially rehabilitated, developed, or constructed, for
rental or sale to persons and families of low or moderate income,
replacement dwelling units which have an equal or greater number of
bedrooms as those destroyed or removed units at affordable housing cost
within the territorial jurisdiction of the agency. When dwelling units are
destroyed or removed after September 1, 1989, 75 percent of the
replacement dwelling units shall replace dwelling units available at
affordable housing cost in the same or a lower income level of very low
income households, lower income households, and persons and families of
low and moderate income, as the persons displaced from those destroyed
or removed units.
The Redevelopment Agency of the City of Rancho Palos Verdes does not
contemplate the removal or destruction of housing units existing within the
Project Area during the period of this Implementation Plan. Thus, there is
no need for a replacement housing plan.
X. INCLUSIONARY HOUSING PLAN
Since the adoption of the Redevelopment Plan, there has been no
Agency assisted housing units developed or substantially rehabilitated
within the Project Area. Nor has there been any privately developed or
substantially rehabilitated housing units constructed within the project
area. Therefore, the Rancho Palos Verdes Redevelopment Agency has no
current inclusionary housing requirements.
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No development of new housing or the substantial rehabilitation of existing
housing within the project area is anticipated within the next ten years or
over the life of the redevelopment plan.
XI. HOUSING SET-ASIDE REQUIREMENTS
The Agency is required to set-aside twenty percent (20%) of the gross
annual tax increment into the Low and Moderate Income Housing Fund.
The purpose of the housing set-aside fund is to increase, improve and
preserve the city's supply of low and moderate income housing. In carrying
out the annual housing set-aside requirements, the Agency may exercise
any or all of its powers, including the following:
• Acquire real property or building sites subject to the provisions of
CRL Code Section 33334.16. In March 2000, the Agency purchased
the Crestridge property for $702,392 with RDA set-aside funds.
The property was purchased with the intent that the property be
used for the development of affordable housing. It is still the
intention of the Agency to use this property for the development
of affordable housing.
• Improve real property or building sites with onsite improvements but
only if either (A) the improvements are made as part of a program
which results in the new construction or rehabilitation of affordable
housing units for low or moderate income persons who are directly
benefited by the improvements and are a reasonable and
fundamental component of the housing units, and (B) the agency
requires that the units remain available at affordable housing cost,
to and occupied by persons and families of extremely low, very low,
low or moderate income for the same time period and in the same
manner as provided in CRL Section 33334.3(F)(2).
• Donate real property to private or public persons or entities.
• Finance insurance premiums subject to CRL Section 33136.
• Construct buildings or structures.
• Acquire buildings or structures.
• Rehabilitate buildings or structures.
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• Provide subsidies to, or for the benefit of extremely low income
households or very low-income households, as defined by Health and
Safety (Hats) Code Section 50105, lower income households, as
defined by HatS Code Section 50079.5 or persons and families or low
or moderate income, as defined by Has Code Section 50093, to the
extent those households cannot obtain housing at affordable costs
on the open market. Housing units available on the open market are
those units developed without direct government subsidies.
• Develop plans, pay principal and interest on bonds, loans, advances,
or other indebtedness, or pay financing or carrying charges.
• Maintain the community's supply of mobile homes.
• Preserve the availability to lower income households of affordable
housing units in housing developments which are assisted or
subsidized by public entities and which are threatened with
imminent conversion to market rates.
The twenty percent housing set-aside fund monies can also be used for
planning and general administrative costs, when directly related to
programs and activities associated with CRL Code Section 33334.2(e). This
includes the following activities:
• Costs incurred for salaries, wages, and related costs of the Agency's
staff or for services provided through inter-agency agreements, and
agreements with contractors, including usual indirect related costs.
• Costs incurred by a non-profit corporation that are not directly
attributable to a specific project.
• Legal, architectural, and engineering costs and other salaries,
wages, and costs directly related to the planning and execution of a
specific project which are authorized under subdivision (3) of CRL
Code Section 33334.2 and which are incurred by a non-profit housing
sponsor and are not planning and administrative costs for the
purpose of this section, but are, instead, project costs.
The Agency is entitled to spend its twenty percent housing set-aside funds
both within the Project Area and outside of the Project Area (but within
the jurisdictional boundary of the City of Rancho Palos Verdes).
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Housing Set-Aside Fund Estimate
In order for the Agency to estimate the number of units it could assist in
the next five years, a projection of twenty percent (20%) of the tax
increment revenue was developed for the period FY 2004-2005 through FY
2009-2010. As of December 3l, 2004, it is estimated that the
Redevelopment Agency will have accumulated approximately$1,003,663 in
the Housing Fund.
These monies will be allocated towards the preservation, development
and/or rehabilitation of very low, low and moderate income housing units.
It is expected that these funds will be leveraged in concert with one of the
housing programs cited in Section XIII.
TABLE 6
PROJECTED HOUSING SET-ASIDE
Estimated 20% Estimated Housing
Fiscal Years Tax Increment Expenditures
As of 12/31/04 1,003,663 (1)
Remainder of 2004 - 2005 83,274 (1) 0
2005 - 2006 125,700 0
2006 - 2007 128,200 1,212,637
2007 - 2008 130,800 128,200
2008 - 2009 133,400 130,800
2009 - 2010 133,400
Total $1,605,037 $1,605,037
(1) Estimated 20%Tax Increment also includes interest earnings.
These funds will be spent in proportion to the housing needs in the City
as follows:
Very Low = 8 units (38% or $609,914)
Low = 5 units (24% or $385,209)
Moderate = 8 units (38% or $609,914)
Of that, based upon the 2000 Census, which indicates that the City's
Senior population (65 years and older) is 18.71% of the population, the
City will not expend more than 18.71% specifically allocated towards
this senior population.
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XII. LONG TERM HOUSING GOALS AND POLICIES
The General Plan Housing Element for the City of Rancho Palos Verdes has
six separate and distinct goals developed to address the various housing
needs of the City. These are explicitly stated in order to give latitude and
authority to design and address the implementation of the housing
program. They are as follows:
Goal 1 DESIGNATE SITES THAT FULLY MEET THE HOUSING NEEDS OF
ALL INCOME GROUPS AS QUANTIFIED BY SCAG'S REGIONAL
HOUSING NEEDS ASSESSMENT.
Goal 2 ASSIST IN THE PROVISION OF HOUSING AFFORDABLE TO VERY
LOW, LOW AND MODERATE-INCOME HOUSEHOLDS.
Goal 3 REMOVE EXISTING GOVERNMENTAL CONSTRAINTS TO THE
MAINTENANCE, PRESERVATION, IMPROVEMENT AND
DEVELOPMENT OF HOUSING.
Goal 4 CONSERVE AND IMPROVE THE EXISTING STOCK OF
AFFORDABLE HOUSING.
Goal 5 ATTAIN A HOUSING MARKET WITH "FAIR HOUSING CHOICE",
MEANING THE ABILITY OF PERSONS OF SIMILAR INCOME LEVELS
REGARDLESS OF RACE, COLOR, RELIGION, SEX, NATIONAL
ORIGIN, HANDICAP AND FAMILIAL STATUS TO HAVE AVAILABLE
TO THEM THE SAME HOUSING CHOICES.
Goal 6 PRESERVE THE EXISTING AND FUTURE SUPPLY OF AFFORDABLE
HOUSING THAT IS FINANCIALLY ASSISTED BY THE CITY,
COUNTY, STATE OR FEDERAL GOVERNMENTS.
The 1999 Regional Housing Needs Assessment (RHNA) provided by the
Southern California Association of Governments (SCAG) for the five year
period of 2000-2005, called for 8 very low income housing units, 5 low
income housing units, 8 moderate income housing units and 31 high income
housing units for a total of 53 new housing units in the City of Rancho Palos
Verdes.
According to State Law, cities are required to adopt an updated General
Plan Housing Element every 5 years. In order to prepare the updated
General Plan Housing Element, cities rely upon SCAG to furnish the
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updated RHNA. In an effort to improve existing Housing Element Law,
recent legislation was enacted to postpone the deadline for cities in the
SCAG region to complete their updated Housing Element from June 30,
2005 to June 30, 2006. As of the date this Implementation Plan was
adopted, SCAG had not yet prepared the RHNA. As such, until a new RHNA
has been adopted by SCAG, the City will continue to operate under the
same guidelines and housing production figures of the 1999 RHNA (see
preceding paragraph). The fulfillment of the Redevelopment Agency's
obligation to utilize 20% of its tax increment income for low to moderate
income housing preservation, improvement and/or development will
support the General Plan Housing Element Goals and assist in meeting the
Regional Housing Needs allocated to the City of Rancho Palos Verdes now
and in the future.
XIII. FIVE-YEAR HOUSING GOALS
During the five-year period of the implementation plan, the
Redevelopment Agency of the City of Rancho Palos Verdes will facilitate
the preservation, new construction and/or rehabilitation of affordable
housing projects that will support the following goals:
• Satisfy the replacement housing requirements of the Community
Redevelopment Law as they relate to any housing units, if any,
displaced by Redevelopment Agency activities.
• Satisfy the inclusionary housing requirements of the Community
Redevelopment Law as they relate to the provision of affordable
housing as a percentage of any new or substantially rehabilitated
housing which may be constructed within the Redevelopment
Project Area.
• Meet the fair share regional affordable housing goals for the City of
Rancho Palos Verdes by improving public improvements and
community facilities, removing and preventing blighting conditions
and providing and/or preserving affordable housing resources.
• Support overall community development, economic development,
and redevelopment/revitalization efforts within the City of Rancho
Palos Verdes by improving public improvements and community
facilities, removing and preventing blighting conditions and
providing and/or preserving affordable housing resources.
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It is anticipated that the Redevelopment Agency will couple housing set
aside funds with other public and private funding sources as described
below. The Redevelopment Agency will seek to generate the construction,
substantial rehabilitation, and/or purchase of affordability covenants
through public and/or nonprofit sponsors. The City of Rancho Palos Verdes
has no Article 34 authority and it is not anticipated that the
Redevelopment Agency or the City of Rancho Palos Verdes will directly own
and manage affordable housing projects.
Project Selection Criteria
Projects seeking financial assistance from the Redevelopment Agency's Low
and Moderate Income Housing Fund will be evaluated on a case-by-case
basis based on the following criteria:
• Ability of the project to generate other public/private funding in
support of housing set aside funds.
• Degree to which the proposed project meets multiple community
goals in addition to affordable housing goals. These goals include
but are not limited to the following:
a. Replacement housing requirements.
b. Inclusionary housing requirements.
c. Fair share regional housing requirements.
d. Community goals for redevelopment, neighborhood
revitalization and economic development.
• The cost benefit of the proposed affordable housing program as
defined by the level of affordable housing assistance requested as it
relates to the number of affordable housing units provided.
• The financial track record, management and development
experience of the proposing sponsor.
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Annual Targets
The number of affordable housing units to be developed/established over
the five year implementation plan period will depend in large part on
market conditions, availability of funding to supplement housing set aside
funds and the degree to which proposals are submitted which satisfy the
stated goals and objectives. Subject to these limiting factors, the
following are the production goals for the five-year implementation plan:
TABLE 7
ANNUAL HOUSING GOALS
Year Units
2005 0
2006 0
2007 15
2008 3
2009 3
2010 0
2011 0
2012 15
2013 3
2014 3
TOTAL: 42
Limiting Factors
The estimates of housing units noted above may include very low, low and/or moderate
income units constructed or rehabilitated by developers or nonprofit organizations with
the financial assistance of the Agency, and/or units produced or rehabilitated with the
direct assistance of the Agency through the purchase of affordability covenants.
A number of conditions may limit the ability of the Redevelopment Agency to meet
Implementation Plan goals. Among them are the existing land uses and socioeconomic
characteristics of the project area, limited funds available from the Agency's low and
moderate income housing funds and other funding sources, and changing market
conditions.
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Following are examples of some specific programs that could be used by the
Redevelopment Agency of the City of Rancho Palos Verdes to fulfill their housing goals.
Deed-Restrict Existing Projects
Within the City of Rancho Palos Verdes are a number of multi-family projects. The
Agency may negotiate deed restrictions with owners of these existing projects to restrict
rental rates to levels affordable to low and moderate income households. Low and
moderate income housing funds for rehabilitation of the buildings may be offered as an
incentive in exchange for deed restrictions. Assistance to the existing rental stock may
be publicly advertised to solicit applications from existing property owners.
Subsidized New Construction/Purchase of Existing Housing
New construction of rental housing for low and moderate income households traditionally
represents one of a redevelopment agency's primary options to meet its housing
production goals. However, the gap between market rents and rents affordable to very
low and low income households within the City of Rancho Palos Verdes will typically
require significant subsidies to achieve affordability for new construction or the purchase
of existing market rate housing.
The Agency has already taken initial steps in implementing this specific program. In
March 2000, the Agency purchased the Crestridge property for $702,392 with RDA set-
aside funds. The property was purchased with the intent that the property be used for
the development of affordable housing. It is still the intention of the Agency to use this
property for the development of affordable housing.
Substantial Rehabilitation
Rehabilitation of existing rental properties is a cost effective program option to fulfill
the Agency's affordable housing production requirements. The Agency may use Housing
Fund monies to provide financial assistance for the rehabilitation of private, non-profit
and for-profit rental properties. The City/Agency may establish its own rehabilitation
program or may contract with the Los Angeles County Housing Authority to carry out a
rehabilitation program.
First-Time Homebuyers Program
The First-Time Homebuyers Program (FTHB) is a down payment assistance program for
moderate, low and very low income homebuyers. Qualified buyers are eligible to receive
down payment assistance for the purchase of a primary residence. Typically, a second
mortgage is held by the Redevelopment Agency and repaid from the proceeds of a sale or
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refinance. Alternatively, the Redevelopment Agency may elect to allow the sale of the
home to a second qualified buyer and transfer the mortgage for the down payment
assistance to the second qualified owner. As previously discussed, the high cost of
housing in the City of Rancho Palos Verdes could make this program less than cost
effective.
Mortgage Credit Certificate Program
The Mortgage Credit Certificate Program (MCC) is available for first-time homebuyers
who have not had an ownership interest in a principal residence within the previous
three years. Buyers interested in participating in the program make application through
their lender at the time they apply for a home loan. The MCC provides a tax credit,
which allows the borrower to qualify for a larger mortgage. This tax credit is calculated
as 20% of the annual interest paid on the primary mortgage and can be no greater than
$2,000 per year.
XIV. FINANCIAL ASSISTANCE/DEVELOPER PARTICIPATION
The Agency's philosophy with regard to providing financial assistance in the development
of affordable housing will be to leverage low and moderate income funds with other
sources of funds. There are numerous federal, state, county or city programs in which
an agency or developer may participate. In addition, the Agency may establish local
programs to assist in the establishment and preservation of low and moderate income
housing. Appendix A. contains a brief description of these various programs.
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APPENDIX A
LIST OF FUNDING PROGRAMS
HOME Program
The HOME Program is a federally funded grant program for housing. Funds are allocated
by formula to participating jurisdictions that are allowed great flexibility with respect to
the types of properties to be assisted, the types of development (new construction,
modest or major rehab, etc.) to be undertaken, the forms and amounts of financing to
be offered, the quality and type of housing provided, the households assisted and
procedures for running programs.
The intent of HOME is:
• To expand the supply of decent, safe, sanitary and affordable housing.
• To strengthen the abilities of state and local governments to provide housing.
• To assure that federal housing services, financing, and other investments are
provided to state and local governments in a coordinated and supportive fashion.
Low Income Housing Tax Credit (LIHTC)
As part of the Tax Reform act of 1986, Congress created the Low Income Housing Tax
Credit (LIHTC), which provides a tax shelter for limited partners in low income housing
projects. This program or its successor could represent an important financial resource
for affordable housing development by the private sector.
Private Institutions
Under the Community Reinvestment Act (CRA), private lending institutions such as banks,
thrifts, and their affiliated mortgage banking subsidiaries are required to annually assess
the credit needs of the communities in which they operate. The City has and will
continue to hold meetings with lenders to discuss local needs and potential programs
that may be within the guidelines of community reinvestment.
California Community Reinvestment Corporation (CCRC)
CCRC is a non-profit mortgage banking consortium specifically designed to provide long-
term debt financing for affordable housing developments. Created in 1989, the CCRC is
comprised of 56 banks representing all areas of the State. The CCRC finances loans by
pooling funds from each of its member banks. CCRC has its own staff, which screens
applications and provides technical assistance to developers. A loan committee,
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Exhibit"A"
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consisting of senior credit officers from members' banks, approves all loans on behalf of
member banks. When the loan committee approves a loan, CCRC draws funds from each
bank in proportion to their size.
CCRC enters into `partnership"with cities to leverage public monies (redevelopment low
and moderate income housing funds, CDBG, etc.) with CCRC private funds to construct
low and moderate income housing. Five different 30-year fixed rate loans products are
offered, with affordability required to be maintained for the life of the loan. Below
market interest rates are provided to both non-profit and for-profit sponsors (Treasury
bonds of comparable maturities plus 100 basis points for non-profits, plus 200 basis
points for profits.)
Federal Home Loan Bank
The affordable housing programs mandated by the Financial Institutions Reform,
Recovery and Enforcement Act (FIRREA) of 1989 and the Community Reinvestment Act
are now being implemented through the 12 Federal Home Loan Banks. By law, the
affordable housing provisions call for, among other things, a requirement for interest-
subsidized loans to be extended to low income homebuyers, as well as a variety of
lending activities that fall under the "community investment" heading.
Through the Affordable Housing Program, the FHLB provides interest rate subsidies on
advances to member banks that engage intending to long-term low to moderate income
owner-occupied or affordable rental housing. Loans that qualify for the program include
those used to finance homeownership by low income families, and loans that finance the
purchase, construction or rehabilitation of rental housing, of which at least 20 percent
will be occupied by very low income households.
In addition to the Affordable Housing Programs, the FHLB also implements a
Community Investment Program. Through this program, each district bank
appoints a community investment officer and provides "community-oriented"
mortgage loans to members at its own cost of funds. Loans that qualify for the
program include those used to finance the purchase or rehabilitation of homes by
borrowers earning 115%or less of the area median income, and those that finance
commercial or economic development projects that benefit low and moderate
income families.
Single Family Mortgage Revenue Bond Program
Los Angeles County coordinates interested lenders and developers who wish to
participate in a single-family, tax exempt bond program. The County issues tax
exempt bonds to generate a pool of funds from which mortgages will be drawn.
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The developers and/or lenders pay the costs of the financing and reserve a
portion of the pool to originate mortgages in their projects. The individuals
purchasing the homes must be first time homebuyers and fall within certain
income parameters. Ultimately, the first time homebuyer can qualify for a larger
mortgage because the interest rate is lower than market rate. The
developer/lender can use the mortgage pool to more effectively market their
homes.
Multi-Family Bond Program
The Multi-Family Bond Program provides long-term financing for multi-family
projects at tax exempt rates. The program requires that 20% of the units be
reserved for low and moderate income residents. Project owners are required to
provide a letter of credit, insurance or other credit, insurance or other credit
enhancement for the financing.
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Exhibit"A"
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ATTACHMENT 1-A
List of Proposed Projects and Estimated Expenditures
Capital Expenditures:
• Purchase a generator for Abalone Cove Sewer System.
Estimated Expenditure: $18,000
FY 05 - 06
• Construct a sewer lateral for properties to connect to the Abalone Cove Sewer System
Estimated Expenditure: $53,000
FY 05 - 06
Annual Expenditures For Maintenance and Administration Activities
• Engineering and Contract Services to repair and rehabilitate observation and
dewatering wells
Estimated Expenditure: $106,000 annually
FY05/06 through FY09/10
• Engineering Services to monitor the operation of the existing monitoring and
dewatering wells.
Estimated Expenditure: $4,900 annually
FY05/06 through FY09/10
• Engineering and Contract Services to repair and rehabilitate discharge lines for
dewatering wells.
Estimated Expenditure: $30,000 annually
FY05/06 through FY09/10
• Contract Services to maintain that portion of Palos Verdes Drive South within the
project area.
Estimated Expenditure: $106,000 annually
FY05/06 through FY09/10
• Energy Cost for the operation of pumps for the dewatering wells.
Estimated Expenditure: $17,000 annually
FY05/06 through FY09/10
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Exhibit"A"
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Exhibit"A"
Resolution No. RDA 2004-12
25