BURBANK REDEVELOPMENT AGENCY
Tuesday, January 23, 2006
AGENDA
CITY COUNCIL CHAMBER - 275 EAST OLIVE AVENUE
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6:30 P.M.
INVOCATION:
The Courts have concluded that sectarian prayer as part of City
Council meetings is not permitted under the Constitution.
FLAG SALUTE:
ROLL CALL:
CONSENT CALENDAR: (Item 1)
The following item may be enacted by one motion. There will be no separate discussion on this item unless a Member so requests, in which event the item will be removed from the consent calendar and considered in its normal sequence on the agenda. A roll call vote is required for the consent calendar.
1. CONSIDERATION OF TWO AFFORDABLE HOUSING AGREEMENTS FOR 2219 NORTH NIAGARA STREET, 2329 NORTH NIAGARA STREET AND 261 WEST VERDUGO AVENUE:
The purpose of this report is to provide the Council and Redevelopment Agency (Agency) Board with information to consider two Affordable Housing Agreements (Agreements) with the Burbank Housing Corporation (BHC) that will assist in the acquisition and rehabilitation of two units located at 2219 North Niagara Street, four units located at 2329 North Niagara Street and eight units located at 261 West Verdugo Avenue.
Over the past ten years, the success of providing affordable housing in our Focus Neighborhoods, through the acquisition and rehabilitation program, is largely due to the City/Agency�s partnership with the BHC. Agency staff and the BHC have identified an opportunity to acquire properties for the purpose of providing affordable housing in the Verdugo-Lake and Golden State Focus Neighborhoods. The properties identified for this purpose are located at 2219 and 2329 North Niagara Street, and 261 West Verdugo Avenue. If approved, the acquisition will increase the affordable housing stock in the community by adding 14 units available to very low, low, and moderate-income households. In addition, the purchase and rehabilitation of these three properties meet the objectives and programs outlined in the City�s Affordable Housing Strategy (approved by the Council and Agency Board in March 2006) and contribute 14 additional units towards the housing acquisition strategy goal of 20 units for this fiscal year.
On December 29, 2006, the BHC submitted a proposal requesting the Council and Agency provide financing to acquire and rehabilitate all three properties. The BHC has entered into two separate purchase agreements with the owners of the three individual properties for a combined total property acquisition cost of approximately $2.8 million. The proposed two Agreements with the BHC, describe the terms and conditions for the acquisition, rehabilitation, relocation and operation of the properties (including affordability covenants). In addition, the Agreements outline the use of the Agency�s Low and Moderate-Income Housing Funds and allow for a conditional commitment of HOME funds as a proposed source of funding for 261 West Verdugo Avenue. The purchase agreements are contingent upon City and Agency Board approval of financing and an Agreement; one for the Niagara properties and a second for the Verdugo property.
The scope of rehabilitation work will slightly vary for each property. In general, rehabilitation for the 14 units will include the following improvements: demolition; abatement of asbestos and lead-based paint; repair to existing roof; renovation of kitchens and bathrooms; upgraded heating and air conditioning systems; replacement of exterior doors and windows; upgraded electrical and plumbing systems; repair and painting of interior and exterior walls; new carpeting; and, landscaping/site work.
In addition, improvements at 2219 North Niagara Street include construction of an additional 190 square feet onto the back unit in order to create a two-bedroom unit and a community laundry facility for residents of the property. The proposed rehabilitation work for both properties is estimated to cost approximately $1.28 million and includes the following indirect costs: closing costs, taxes, insurance, and BHC developer fee in the amount of $717,708.
It will be necessary to relocate the current residents of these properties to perform the rehabilitation. Displaced households will be eligible for relocation assistance pursuant to California Relocation Assistance Law and Real Property Acquisition Guidelines and in accordance with the Niagara Street Relocation Plan and the Verdugo Avenue Relocation Plan. The actual amount of relocation assistance will be determined on a case by case basis. However, it has been estimated that the relocation budget for both proposed affordable housing projects will be $245,000. This budget will be utilized for replacement housing payments, moving allowances and last resort housing payments.
The total estimated cost for the proposed projects is estimated to be $4,300,230. In summary, the amount includes: the property acquisition of approximately $2.8 million; an estimated relocation budget of $245,000; and an estimated rehabilitation cost (including direct and indirect costs) of $1.2 million. If approved, financial assistance is proposed through three loans. Contingent upon Housing and Urban Development (HUD) approval authorizing the use of HOME funding, staff proposes the City will provide a loan in the amount of $848,653 to be forgiven at the end of 55 years if all loan terms are met as outlined in the Agreement. In addition, staff proposes the Agency enter into two separate loan agreements totaling $2,700,643 to be amortized over a 55-year period, at three percent simple interest and repaid annually through residual receipts generated by the properties. The remaining project costs are related to the developer fee and relocation cost associated with any acquisition/rehabilitation project undertaken by the Agency.
Recommendation:
Adoption of proposed resolutions entitled:
1. A RESOLUTION OF THE REDEVELOPMENT AGENCY OF THE CITY OF BURBANK AMENDING THE FISCAL YEAR 2006-2007 BUDGET BY APPROPRIATING $2,791,728 TO FUND THE ACQUISITION AND REHABILITATION OF 2219 NORTH NIAGARA, 2329 NORTH NIAGARA STREET AND 261 WEST VERDUGO AVENUE.
2. A RESOLUTION OF THE REDEVELOPMENT AGENCY OF THE CITY OF BURBANK APPROVING AN AFFORDABLE HOUSING AGREEMENT BETWEEN THE REDEVELOPMENT AGENCY OF THE CITY OF BURBANK, THE CITY OF BURBANK, AND THE BURBANK HOUSING CORPORATION (261 WEST VERDUGO AVENUE).
3. A RESOLUTION OF THE REDEVELOPMENT AGENCY OF THE CITY OF BURBANK APPROVING AN AFFORDABLE HOUSING AGREEMENT BY AND BETWEEN THE REDEVELOPMENT AGENCY OF THE CITY OF BURBANK AND BURBANK HOUSING CORPORATION (2219 NORTH NIAGARA STREET AND 2329 NORTH NIAGARA STREET).
END OF CONSENT CALENDAR
RECESS to conclude the City Council meeting.
ADJOURNMENT.