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Home My WebLink About02/04/1997, 2 - REQUEST TO AMEND THE VILLA ROSA PLANNED DEVELOPMENT AFFORDABLE HOUSING REQUIREMENT.Council j acEnba ucpoizt C I T Y OF SAN L U IS O B I S P O FROM: Arnold Jonas, Community Development Director PREPARED BY: Jeff Hook, Associate Planner SUBJECT: Request to amend the Villa Rosa Planned Development affordable housing requirement. CAO RECOMMENDATION: Introduce ordinance amending the Villa Rosa residential planned development affordable housing requirement to meet Housing Element policies. REPORT -IN-BRIEF Due to changed real estate market conditions and financial problems, only 26 of Villa Rosa's 85 condominiums were completed, and the project's original affordable housing program is likely to delay or prevent the project's completion. A total of 41 units were to be sold at prices discounted from 5 - 35 percent below market price. Of the 41 discounted units, at least 26 units were to be sold to low or moderate income households; the remaining 15 units were to be sold to above moderate income persons (households earning over 120 percent of County median income). To date, eight condominiums have been sold at below market prices. They are to remain affordable for up to 12 years. Since Villa Rosa was approved, the City adopted inclusionary housing standards which require fewer affordable housing units than originally required, but maintain affordability for a longer period for the affordable units. The Planning Commission's recommended strategy would modify the project's conditions of approval to help achieve multiple Housing Element objectives: to encourage Villa Rosa's completion, and to bring the affordable housing program into compliance with current standards. The applicant, Mid State Bank, and the City's Housing Authority, support the Planning Commission's recommendation. DISCUSSION Planning Commission Recommendation At its January 8, 1997 meeting, the Planning Commission voted 4 -0 (Commissioners Senn, Karleskint, and Ready stepped down due to a potential conflict of interest) to recommend that the City Council amend Villa Rosa's affordable housing requirement to meet Housing Element policies. Commissioners supported "Alternative 1 ", which: 1) retained the original affordability restrictions for eight existing condominiums, and 2) required that three low - income or four moderate - income units be built, or in -lieu housing fees be paid with completion of the remaining 59 condominiums. 2 Council Agenda Report - Villa Rosa Affordable Housing Requirement Page 2 Background In September 1991, the City Council approved the Villa Rosa Planned Development (PD), an 85 -unit residential condominium project. Now, several years later, only about one -third of the units are built and occupied, and the 59 remaining undeveloped lots are now owned by the lender due to the developer's financial problems. The current owner, Mid -State Bank (MSB), is trying to sell the remaining undeveloped lots to a developer interested in completing the approved project. Condition 2 of the ordinance which approved the Villa Rosa PD established an affordable housing program. As explained in the attached letter, MSB wants to delete this condition, asserting that: 1) a changed real estate market has reduced the sales prices of the units, making the affordability condition no longer applicable; and 2) the affordability requirement is likely to discourage prospective developers from buying the property and completing the project. MSB assumed ownership of Villa Rosa in October 1994. Twenty six condominiums have been built and 21 units sold. Of these, eight units were sold at discounted prices to meet the PD's affordability requirements. Five units remain unsold or are in escrow. Subdivision improvements are either completed or have otherwise been guaranteed. Portions of the street system and common -area landscaping are complete; rough grading and utilities are completed for the undeveloped lots. Some project amenities, such as landscaping and recreation facilities, intended to serve the entire development have not yet been built. Evaluation Villa Rosa was an attempt at a unique housing development for San Luis Obispo. It came at a time when the housing market was strong, and the market appeared able to support a project with numerous amenities and an affordable housing component. It offered a privately funded affordable housing program in a market -rate, high quality condominium project, and attracted considerable public support. Villa Rosa met many General Plan policies, especially those encouraging the development of affordable housing close to employment centers and public transportation. Other public benefits included a public bikeway and trail corridor, public art, and a historic monument. With a density of 13.69 density units per net acre — well below the allowed R -3 density of 18 density units per net acre -- no density bonus was needed or approved. To accommodate the project, the City amended the General Plan and rezoned the site from M- S to R -3 -PD, abandoned portions of three streets, approved a vesting tentative map, and granted final architectural approval. Villa Rosa also received special incentives, due largely to its affordable housing feature. These included: ,Z -2 Council Agenda Report - Villa Rosa Affordable Housing Requirement Page 3 • reduced building permit and inspection fees; • reduced engineering permit and inspection fees; and • deferred payment of $23,200 in water acreage fees and $151,991 in park -in -lieu fees, allowing the fees to be paid incrementally as units were sold -- not as a lump sum payment payable when the first unit was occupied, as originally required. Original Affordable Housing Program The City approved Villa Rosa, in part, due to the innovative affordable housing package proposed by the developer. Condition 2 of the approved planned development rezoning requires the developer to implement these affordability features: • at least 41 units at prices discounted from 5 to 35 percent below market value, for buyers earning from 80 to 150 percent of median County income; • resale price controls for affordable units, for up to 12 years from the original purchase date; • a 20 percent "recapture fee" which returns a portion of the profit from the sale of discounted units to the City for additional affordable housing; and • consultation with the Housing Authority to determine income eligibility of prospective buyers of discounted units. Should Affordable Housing Be Reduced? Mid -State Bank has stated that it is unlikely that the PD, with the originally approved affordability program, can be completed. They have requested modification to the PD to make the project feasible in the current and foreseeable market. A modification of the PD that would be consistent with the adopted General Plan is possible. The basic question is: should Villa Rosa's affordable housing requirement be reduced to facilitate completion of the project? Arguments which support modifying the affordable housing program include: 1. Real estate market changes since 1991 have reduced sales prices for many properties in San Luis Obispo, including Villa Rosa, making home ownership more attainable for some households, even without affordability controls. Recent sales prices at Villa Rosa have been about 20 percent lower than original market prices; 2. The original affordable housing program, while innovative and perhaps, economically feasible in the "hot" housing market of 1991, exceeds current affordable housing standards for in -city projects and is likely to delay the project or make it financially infeasible to complete. 3. Failure to complete the project may pose a hardship for current Villa Rosa residents who a -3 Council Agenda Report - Villa Rosa Affordable Housing Requirement Page 4 bought their units with expectations of certain project characteristics and amenities that will not be constructed until the remaining units are built; 4. There is a compelling need for more housing in San Luis Obispo, and the City needs the additional 59 units of housing provided by the completion of Villa Rosa. It is in the interest of all parties to reduce further delays in the project's completion and to complete the installation of public and private subdivision improvements which have been on hold. Modifying the affordable housing program may help achieve these objectives. 5. Policy 1.22.17 of the Housing Element says that the City will Help coordinate public sector and private sector actions to encourage the development of housing affordable to low and moderate income households. By relaxing the affordability program but retaining some affordable requirement, the City can meet the intent of this policy. This action would improve the chances of getting some affordable housing -- albeit less than originally proposed -- mixed with market rate housing. 6. Changes in the project status have added to development costs. The project's vesting tentative map status expired 24 months after the final map was recorded, and new units must now pay wastewater impact fees, adding about $145,500 to the project's development cost. Traffic and water impact fees do not apply, since the project's original traffic mitigation fee satisfies the traffic impact fee requirement, and the City Council allowed the incremental payment of water acreage fees, which supersedes payment of water impact fees. In addition, the project must still earn about 18 acre feet in water credits to complete construction, estimated to cost about $45,000. One argument against modifying the PD is that by retaining the original affordable housing requirement, time and market forces may reduce land costs to the point at which the project becomes financially feasible to complete. Until this point is reached, development of the remaining 59 condominiums will be delayed. Moreover, there is no guarantee that changing the affordable housing requirement will resolve MSB's financial concerns and result in the timely sale and completion of the project. Without flexibility on affordable housing, however, the lender's marketing efforts will be made more difficult due to prospective developers' concerns with costs and resale restrictions. The City's adopted goals do not guarantee a profit or minimizing losses on a development project; however they do encourage the production of housing with an affordable housing component. Consequently, staff believes a modified affordable housing program is warranted. .Z &-y Council Agenda Report - Villa Rosa Affordable Housing Requirement Page 5 Alternative Approaches to Affordable Housing Alternative 1 The City could amend the PD to suspend the current affordable housing program and to require the project to meet current affordable housing standards. These standards would require fewer affordable units than required under the approved PD, but maintain affordability longer. The standards call for at least three percent (3%) of the total units to be affordable to low- income households, pr at least five percent (5 %) of the units to be affordable to moderate - income households; or the developer may opt to pay an "in -lieu fee" equal to 5% of the building valuation. The in -lieu fee would total $461,493. Affordable units built under this provision must remain affordable for at least 30 years. This is the approach the Planning Commission recommends, and would require: • at least three low- income units (.03 X 85 = 2.55 or 3 units) be built; or • at least four moderate - income units (.05 X 85 = 4.25 or 4 units) be built. Affordable condominium units would need to be offered at or below the following sales prices (1996 Affordable Housing Standards): .k»kkuS >.k;;k:::+ , `r;.. �* kY ,kk.,,lxxxlw,`�j YyFk�i'+iJV.y`. +msµ, a`S Im r . \. °a` Si'1� ` 'iCk.\: :X C%":v Sjkkk)kk;kkkkkti; >J kkkJ "' ::k \.,.` ,- `,+'Lk '+,t..k':;;x \. } k W +k: �k.�kk. \ k ; } k �(�Wi2t,. kikM �iJ iR� M W �3,�. kn4'M "`>'"\ ��.:�.�,:,�,.. ;Q`kki`Rkk .; kk`.w.Sk::'4k , A x`�k22 k<Y' h yi`. " v : "��n:Z "�k� ,.k.+ ; � . �Y ; w�xOXd2xy.``C`�0 ; k +' k:`�` {;..,.y„4�:.,.,,..,: Low (up to $34,650 for a 78,000 90,063 family of four) Moderate (up to $51,950 for 140,250 162,075 a family of four) Under this approach, the eight units already sold at discounted prices would remain affordable under the original resale restrictions for up to 12 years from the original sale. Upon the first resale of these eight units, 20 percent of the profit would go to a housing trust fund for affordable housing. The developer could then choose to either pay an in -lieu housing fee, or to build three, low- income units or four, moderate - income units to be offered from the remaining 59. Unit types and locations could be left up to the developer, provided that the discounted units were distributed throughout the development and were equivalent to market - rate units in terms of design and amenities. Resale restrictions would be recorded as deed restrictions on the discounted units to ensure affordability for at least 30 years. MSB has submitted a letter agreeing to this approach. Recent sales prices have actually been lower than the maximum sales price for moderate income buyers; however selling prices for the new units are likely to increase in future phases due to increased project costs. Resale restrictions for the affordable units would prevent 2.S Council Agenda Report - Villa Rosa Affordable Housing Requirement Page 6 windfalls when the affordable units changed hands and keep the units affordable over time. The advantages of this approach are its simplicity, ease to administer, and consistency with adopted General Plan policy. It would produce 12 affordable units (14% of the total PD units), and would encourage developers to complete the project in a timely manner, since the developer's affordable housing costs would be minimized by developing and selling the affordable units in a lower -priced housing market. Alternative 2 Another approach is to allow the developer to pay a fee "in lieu" of actually building the affordable units. Under the approved program, 22 of the condominiums are to be affordable to households earning 120 percent or less of the County median income -- the upper threshold to qualify as "moderate income"; and four units are to be sold to households earning 80 percent or less of the County median income -- the maximum income threshold for "lower income" households. Thus, 26 of the 85 units were to be "affordable" under the City's Affordable Housing Standards. Since eight affordable condominiums have already been sold, the City could determine that a future developer's responsibility was actually 26 -8, or 18 affordable units. This requirement could be met by paying an in -lieu fee. The Housing Authority has suggested an in -lieu fee of $20,000 per unit (average per unit land cost for public housing); plus paying $250 per unit to reserve a specified number of Mortgage Credit Certificates (MCC) through the Housing Authority. The MCC program is a tool which increases the buying power of low- and moderate - income buyers. Under this approach, the future developer would pay an in -lieu fee of $160,000 (8 X 20,000 = 160,000); plus $2,500 (10 X 250 = 2,500) for the MCC program, or some combination of these fees, to be negotiated between the City and the developer -- roughly equivalent to the recent sales price of a Model E condominium unit. The advantages of this approach are that it is easy to implement, resolves marketing concerns with resale restrictions, helps the Housing Authority develop additional public housing, and helps 10 low- or moderate income homebuyers purchase a home in the City. The eight affordable units already sold would remain affordable for 12 years. The disadvantage of this approach is that, after 12 years, Villa Rosa would no longer include deed - restricted affordable housing to meet City standards. What's Next MSB would like to sell the remaining Villa Rosa lots to a developer who would then complete the project as originally designed and approved. MSB intends to offer financing packages to z -& i Council Agenda Report - Villa Rosa Affordable Housing Requirement Page 7 prospective developers, including construction financing for the new units, presumably at favorable rates to encourage purchase and development. RECONEMUE DATION Introduce an ordinance to print amending Villa Rosa's affordable housing requirement as described in Alternative 1, by modifying Condition 2, Section 3, of Ordinance No. 1197 (1991 Series) as follows: 2. The Developer shall include an affordability program which includes these provisions: A. The resale of eight affordable housing units would continue to be regulated under the affordable housing provisions originally approved on August 20, 1991; B. Development of the remaining 59 units shall require the developer to meet affordable housing requirements under Table A of the Housing Element, using 85 units as the base number of approved housing units. C. Affordable housing units shall be offered, or in -lieu fees paid, prior to occupancy release of the next building cluster, to the approval of the Community Development Director. Attachments: -Draft Ordinance - Letter from Mid -State Bank -Villa Rosa Affordability Provisions - Ordinance No. 1197 (1991 Series) - Planning Commission minutes jh/villarm-ccRt 2.7 ORDINANCE NO. (1997 SERIES) AN ORDINANCE OF THE CITY OF SAN LUIS OBISPO AMENDING THE AFFORDABLE HOUSING REQUIRIIVIENT FOR THE VILLA ROSA PLANNED RESIDENTIAL DEVELOPMENT. WHEREAS, in 1991 the City Council adopted Ordinance No. 1197, approving an 85- unit planned residential development known as Villa Rosa, located at 843 Mutsuhito Avenue (PD 1518); and WHEREAS, Condition 2 of that ordinance established sales price and resale restrictions for 41 of the 85 units to maintain housing affordability for a period of twelve years, as proposed by the developer; and WHEREAS, 'due to financial difficulties, the project has not been completed and only 26 condominiums have been built and are occupied; and WHEREAS, in an effort to expedite completion of the remaining 59 approved units and public area improvements, the owner has requested that Villa Rosa's affordable housing program be amended; and WHEREAS, the Planning Commission has held a public hearing on the requested amendment, and based on its deliberations, General Plan policies, and public testimony, recommended that the City Council amend Ordinance No. 1197 (1991 Series) for consistency with the Housing Element, specifically, Table 1 - Affordable Housing Requirements, and Policy 1.22.17 which says that the City will help coordinate public sector and private sector actions to encourage the development of housing affordable to low and moderate income households; and WHEREAS, the Director of Community Development has determined that proposed 2 -8 Ordinance No. (1997 Series) Page 2 ordinance amendment is not a "project" as defined in Section 15378 of the California Environmental Quality Act (CEQA) and is, therefore, exempt from the provisions of CEQA; THEREFORE, BE IT ORDAINED by the Council of the City of San Luis Obispo as follows: SECTION 1. Environmental Determination. The City Council has determined that adoption of this ordinance amendment is not a "project" as defined by CEQA and is, therefore, exempt from the provisions of CEQA. SECTION 2. Findings. The City Council, on recommendation of the Planning Commission and after considering staff reports and public testimony, finds that: 1. The proposed ordinance amendment is consistent with the General Plan. 2. The proposed ordinance amendment is warranted because: 1) the affordability requirement is likely to discourage prospective developers from buying the property and completing the project; 2) the amendment will bring the project into compliance with the City's adopted affordable housing standards. 3. The proposed ordinance will promote long -term affordable housing opportunity for low- or moderate income households. SECTION 3. Villa Rosa Planned Development amended. The City Council does hereby amend Condition 2, Section 3, of Ordinance No. 1197 (1991 Series) as follows: 2. The Developer shall include an affordability program which includes these provisions: A. The resale of eight affordable housing units would continue to be regulated under the affordable housing provisions originally approved on August 20, 1991; B. Development of the remaining 59 units shall require the developer to meet affordable housing requirements under Table A of the Housing Element, using 95 units as the base number of approved housing units. C. Affordable housing units shall be offered, or in -lieu fees paid, prior to occupancy release of the next building cluster, to the approval of the Community Development Director. SECTION 4. Notice and Publication. A summary of this ordinance, together with the names of councilmembers voting for and against, shall be published once in full, at least three (3) days prior to its final passage, in the Telegram- Tribune, a newspaper published and a -F Ordinance No. (1997 Series) Page 3 circulated in this city. This ordinance shall go into effect at the expiration of thirty (30) days after its final passage. INTRODUCED AND PASSED TO PRINT by the Council of the City of San Luis Obispo at its meeting held on the day of , 1997, on motion of , seconded by and on the following roll call vote: AYES: NOES: ABSENT: Mayor Allen Settle ATTEST: CITY CLERK APPROVED: Ua r j M:vHlamm -ord z -/o MID -STATE BANK PO Box 580 ARROYO GRANDE, CA 93421 TELEPHONE: (805) 473 -7700 December 31, 1996 Planning Commission City of San Luis Obispo 990 Palm Street San Luis Obispo, California i o CE�� ZO ;ryes J1996 VFW rli* Re: Application of Mid -State Bank to Address the Villa Rosa Planned Development Affordable Housing Requirements Gentlepeople: On behalf of Mid -State Bank, I would like to address their pending application which seeks to address the affordable housing requirements with respect to the construction and completion of the remaining 59 residential units of the Villa Rosa Planned Development. Applicant respectfully suggests that the application can be considered and allowed by the Planning Commission based upon three basic theories which are each consistent and in accord with the current affordable housing provisions within the Housing Element of the General Plan, as follows: (1) That the affordable housing existing under the completed portion of the project (8 of 26 residences), substantially satisfies the intent of the current affordable housing standards of the City of San Luis Obispo; (2) That notwithstanding (1), Applicant supports an amendment which will allow the 59 remaining units to separately meet and satisfy the current affordable housing standards of the City of San Luis Obispo; and, (3) That granting the Applicant's request will best serve to allow the project to proceed without further delay, thus serving to protect and otherwise foster the existing neighborhood which consists of the first 26 Units which have been completed and are substantially sold and occupied, thus fulfilling the City's express goal of protecting existing neighborhoods. Each of the foregoing propositions is hereafter addressed in detail for your consideration and review: 2—// Planning Commission Re: Villa Rosa December 31, 1996 Page 2 FACTUAL BACKGROUND In September of 1991, the City of San Luis Obispo, in conjunction with the application of a developer known as the VILLA ROSA CO., a general partnership, approved a project known as the Villa Rosa Planned Development. Under the original project, a total of 85 homes would be developed in a fashion which were to provide means to place 41 affordable housing units on the market in order to address the City's needs to insure availability of such affordable housing. The 41 units of affordable housing resulted from a matrix providing for a discount on specific sales prices, between 5 % and 35 %, of each of the 41 units. Following the approval of the project and based thereupon, the developer obtained construction financing from Mid -State Bank in the total amount of $5,882,747 in order to proceed with the project. At the time, Mid -State Bank, not unlike the City of San Luis Obispo, believed the project to be feasible. Based upon the financing provided by Applicant, the affordable housing development experiment was off and running. The next parties who joined the affair were the members of the public, including those of lower to moderate income, who purchased 16 of the 26 homes completed before the project failed in October of 1994 and who purchased 9 units thereafter from Applicant . Without a doubt each and every one of the first 16 transactions prior to October of 1994 was based upon the implicit understanding that the entire project would be completed and the entire 85 unit development would be built out as originally envisioned by the developer, the City and Applicant. Unfortunately, the clarity of retrospect provides a reminder that even the best laid plans cannot avert the problems presented by reality. The development suffered from a loss of market and a sour economy. The developer ceased work after completing only 26 units when sales of the various units stalled, and made it impossible to fulfill the financial demands of the project. On October 19, 1994, the developer, in order to avoid a foreclosure, deeded the property back to the Applicant, then consisting of 10 completed units and the bare ground which remains undeveloped. At that time, the principal balance of $3,414,899 remained owing to Applicant, excluding accrued interest and other delinquent charges. Since that date the Applicant has succeeded in selling nine completed units, however, the construction and completion of the remaining 59 units has simply, for lack of a better term, died in the water. The Applicant cannot now complete the project, and has been unable to find a buyer for the project because of the conditions which were originally imposed upon project approval. Specifically, that as to the 85 total unit sales: .2 -/2 Planning Commission Re: Villa Rosa December 31, 1996 Page 3 • At least 41 units sell at prices discounted from 5 to 35 percent below market value, for buyers earning from 80 to 150 percent of median County income (the "affordable unit sale(s) "); • That each affordable unit sale is subject to a 20 percent "recapture" fee which returns a portion of the profit from the sale of discounted units to the City's Housing Authority for additional affordable housing; and • A required consultation with the Housing Authority to determine income eligibility of prospective buyers for each proposed discounted unit. The foregoing conditions have now effectively delayed any reasonable prospect of completing or selling the unbuilt portion of the development, consisting of 59 additional housing units, and as a result both the public and private sector have ultimately suffered. In addition to the staff analysis of the situation which appears factually accurate, Applicant would posit that an equally important consideration under the circumstances would include the consideration of program 1.22.17 of the Housing Element. That program provides: "The City will help coordinate public sector and private sector actions to encourage the development of housing affordable to low and moderate income households." This is the time for the necessary coordination. Clearly the project has failed. This is not a case of a developer coming back and asking for a change of rules in mid game, neither is this a "bait and switch tactic," as some would inappropriately suggest. The original developer maintains no interest whatsoever in the project, and the project as it presently exists is doing absolutely nothing to meet any realistic hope of providing affordable housing to the public. What exists today is a large piece of unmarketable real property, bordering the 26 completed units of the total project which are currently populated by families and homeowners who purchased their homes with the understanding or hope that they alone would not be bearing the common costs associated with the maintenance of the existing common areas of the entire project. Luckily all of these problems can presently be addressed in a fashion which satisfies the City's need to encourage and promote the affordable housing component of its Housing Element. .2—/3 Planning Commission Re: Villa Rosa December 31, 1996 Page 4 Rather than remain steadfast to the restrictions which led both to the developers failure and a deed in lieu of foreclosure, it would appear to be in all concerned parties' interests to learn from the past rather than insist upon compliance with conditions which simply did not work. I. THE EXISTING AFFORDABLE HOUSING PROVIDED FOR BY THE CONSTRUCTION AND MARKETING OF THE FIRST 26 UNITS SUBSTANTIALLY SATISFIES THE STANDARDS AND INTENT OF THE CURRENT AFFORDABLE HOUSING ELEMENT Under 1.22.10 of the Housing Element, Table 1; a developer of a residential project within the city is presently required to "Build 3 % low, or 5 % moderate cost, Affordable Dwelling Units (ADUs), but not less than 1 ADU per project" or pay an in lieu fee. Out of the 26 units which were completed, 8 of those units were sold as affordable dwelling units with resale restrictions which would last for twelve years. According to the staff report, such restrictions would now have to be imposed for up to thirty years in order to satisfy the current affordable housing program, however, as indicated in the promissory note signed by each purchaser (see Exhibit "A "), (secured by a deed of trust), each property purchaser promised to pay 20% of net appreciated value to the Housing Authority upon resale with no time restriction. Hence the 12 year resale restriction was additionally supplemented by a payment due to the Housing Authority which could conceivably extend beyond thirty years, all for the benefit of affordable housing. Since the full build out of the project is 85 units, and eight units have already been sold which are affordable with title restrictions, then, with the exception of the thirty year resale restriction, the full development has already obtained an affordability component of 8185 or 9.4 %. In terms of consideration of affordable housing exposure over a given time frame, this 9.4% over a twelve year period is directly comparable to 3.76% for the entire 85 unit project over a thirty year period, without even considering the 20% net appreciation payment due regardless of sale date under Exhibit "A." 4Z-ley Planning Commission Re: Villa Rosa December 31, 1996 Page 5 APPLICANT SUPPORTS AN AMENDMENT WHICH WILL ALLOW THE 59 REMAINING UNITS TO SEPARATELY MEET AND SATISFY THE CURRENT AFFORDABLE HOUSING STANDARDS OF THE CITY OF SAN LUIS OBISPO Applicant would respectfully suggest that an amended approach to Alternative 1, as originally proposed by staff, would be the most equitable means of addressing both the concerns of the Applicant, the current Villa Rosa Homeowners, the public and the City. In the hopes of reaching that accommodation, Applicant would support a modified condition whereby the current affordable housing standards will be applied to the 59 units which remain to be built. Specifically, that Applicant be allowed to satisfy either the 3 % low income standard or, the 5 % moderate income standard, based upon the remaining 59 units to be built. This would allow the city to approve and conform the remaining portion of the project according to its current Affordable Housing Program, and retain the benefit of the previous 8 affordable housing units. Under this analysis, the standard would require that: (1) At least two (2) units of low- income units: (.03 X 59 = 1.77) be built; OR, (2) At least three (3) units of moderate income units (.05 X 59 = 2.59 ) be built. Said units would then be offered for sale at or below the sales prices incorporated within the 1996 Affordable Housing Standards. In light of the foregoing analysis a total of 10 - 11 affordable units would ultimately be available to the public, resulting in a total affordable housing index of 11.76% - 12.94 %, in light of the existing 8 affordable housing units already in existence. .2 - 1-r Planning Commission Re: Villa Rosa December 31, 1996 Page 6 u THE INTERESTS OF THE EXISTING VILLA ROSA NEIGHBORHOOD SHOULD NOT BE IGNORED OR FORGOTTEN The Housing Element also addresses the importance of neighborhoods to the City of San Luis Obispo, and the importance of weighing the quality and character of existing neighborhoods into planning decisions. There is now in existence a neighborhood consisting of 25 homeowners in the Villa Rosa Tract. These 25 homeowners would simply not be served by any decision which failed to take into account that further delay in completing the remaining portion of the development has a direct and substantial impact on the quality of their neighborhood and their life. They will not be served by the "most obvious argument" stated by Staff at page 4. To wit: retaining the original requirement and allowing "time and market forces" to "reduce land costs to the point at which the project becomes financially feasible to complete ". What is obvious about this argument, is that it completely ignores this existing neighborhood in direct contravention of Goal 1.27 of the Neighborhood Quality provisions of the Housing Element. Goal 1.27 provides: "Neighborhood Quality. Preserve the quality of existing neighborhoods and allow development in a manner that creates neighborhoods of high quality" This neighborhood is entitled to all of the common areas and improvements originally contemplated by the original 85 unit development plan and the common support of 85 homeowners towards those aspects of the development. That goal can be reached, within the parameters of the existing affordable housing program, by adopting the proposed amendment to Alternative 1 herein set forth. That goal can be delayed indefinitely, however, by simply allowing the problem to lie dormant and fester. The problems of common ownership interests are very real, and include the maintenance and upkeep of streets, plumbing facilities, roofs, walls, fences, landscaping and parking lots. CONCLUSION Based upon the foregoing analysis, it would be entirely possible for Applicant to suggest or request that no affordable housing component be required as to the remaining 59 units. Instead, Applicant comes before the planning commission seeking a reasonable accommodation, within the parameters of the City's Housing Element, which bases the affordable housing requirement simply upon the remaining 59 units to be constructed. This 2-16 Planning Commission Re: Villa Rosa December 31, 1996 Page 7 amendment will serve to render the project marketable, and will further serve both the interests of the city and the adjoining neighborhood. Based thereupon, Applicant requests that Condition 2 be amended as follows: provisions: A. The Developer shall include an affordability program which includes these 1. The resale of eight affordable housing units (as sold prior to October 19, 1994), would continue to be regulated under the affordable housing provisions originally approved on August 20, 1991; 2. Development of the remaining 59 units shall require the developer to meet affordable housing requirements under Table A of the Housing Element, using 59 units as the base number of approved housing units; and 3. Affordable housing units shall be offered for sale or in -lieu fees paid, prior to occupancy release of the next building cluster, to the approval of the Community Development Director. Thank you for your consideration of these circumstances. Sincerely Fowler Executive Vice President Mid -State Bank cZ"/% [hil MID-STATE BANK ADMINSTRATIVE OFFICES y t/ 1026 Gu uo Ave., P.O. Box 580. ARROYO GRANDE, CA 93421 805 -473 -7700 FAX 805473 -7752 'YY6 0 *o October 10, 1996 Mr. Arnold Jonas, Director RE: Request for Planned Development Amendment Community Development Villa Rosa (PD 1518 - Tract 2066) City of San Luis Obispo 990 Palm Street San Luis Obispo, CA 93401 -3249 Dear Mr. Jonas: Mid -State Bank is requesting an amendment to eliminate the affordable housing condition (Item 2 - Section 3 - PD 1518) for the Villa Rosa Residential Planned Development in the City of San Luis Obispo. The purpose in requesting this amendment is to hopefully facilitate the sale and disposition of the remaining fifty -nine (59) unbuilt lots to a developer who would complete the project. Pursuant to banking regulations, Mid -State Bank cannot complete construction of the unbuilt units, and must necessarily dispose of the remaining lots. Mid -State Bank acquired ownership of the project in October 1994, upon the financial failure of the original developer. At that time, there were ten (10) standing unsold units and fifty -nine (59) unbuilt lots. After two years of extensive marketing efforts and several price reductions, six (6) units have been sold and closed. Three (3) units are in escrow and one (1) unit remains unsold. Marketing efforts have included utilizing a national real estate auction firm and listings with brokers who also placed the units in the local multiple listing services. Six (6) closing in twenty -four months (an average of one unit closed every two months) has been woefully inadequate, and certainly not encouraging to developers when considering acquisition of the remaining lots to build out the project. As to the financial feasibility of the project, Mid -State Bank has an investment in the fifty -nine (59) lots of $2,516,000 at present. Zt —/8 Mr. Arnold Jonas, Director Community Development City of San Luis Obispo October 10, 1996 Page 2 A recent economic analysis by Bruce Beandoin, a local MAI Appraiser, which was based on composite cash flow, consideration of costs to complete, and the implications of the affordable housing requirement, reflects the residual value of the fifty-nine (59) lots to be $658,000. Even with the elimination of the affordable housing requirement, the residual land value of the remaining fifty-nine (59) lots might reach $1,400,000. If this optimistic scenario did come about, our Bank will have contributed $1,116,000 to lower priced housing in San Luis Obispo. As to Mid -State Bank's efforts to market the property, it is evident that as long as the affordable housing element remains, we will have difficulty in attracting potential developers to acquire and complete the project. Not only does it limit economic feasibility, it detracts from buyers who have shown that they are reluctant to purchase upscale town homes with long term resale restrictions. Upon removal of the affordable housing element, it will be our intent to again aggressively seek out potential developers to acquire and complete the project as originally planned and designed. To further incite potential developers, we would expect to offer financing packages for acquisition, as well as construction financing for the new units. It would be our intent to encourage that the project be completed as quickly as feasible and within the original development plan guidelines. Additional background information about the project -and its current status, together with the original Ordinance No. 1179, is attached herewith. If there is additional information needed, please call. Cordially, Carrol R. Pruett President crp /mg Enclosure 2 -19 VILLA ROSA PROJECT • The original total project provided for eighty -five (85) units. Twenty-six (26) units were built by the original developer. Sixteen (16) units were sold prior to Mid -State Bank acquiring ownership in October 1994, due to financial failure of the original developer. Eight (8) of the sixteen (16) units sold were under the Affordable Housing Conditions. Four (4) were sold at a 35% discount, three (3) at a 25 1/6-35% discount, and one (1) at a 10% discount. • Since acquiring ownership in October 1994, Mid -State Bank has been able to sell five (5) of ten (10) existing "built" units. Four (4) were "E" models and one (1) "D" model. Three (3) units closed in 1995 and two (2) closed in 1996. The "D" unit sold for $151,000.00 and the "E" units sold for $155,000.00 to $160,000.00. Five (5) "built" units remain to be sold. Two (2) are in escrow; an "E" unit at $161,500.00 and a "C" unit at $135,000.00. • As the sales data for the past two (2) years reflects, it has been very difficult to market the existing units, even with substantial price reductions. Further, the existence of the Affordable Housing element has strongly discouraged potential purchasers of the remaining fifty-nine (59) lots. • The present economics of the remainder project just will not support the significant contributions required from the sale of market rate units to underwrite the sale of Affordable Housing units. • The current housing marketplace is so competitive that continuation of Affordable Housing resale restrictions make these homes unmarketable. The market place has demonstrated that purchasers of upscale town homes will not buy homes with long -term income resale restrictions. • This Villa Rosa project is not a high density development which would normally require affordable housing. No density bonus was given for inclusion of the Affordable Housing Condition. Maximum allowed 18 D.U. per acres, actual was 13.25 D.U. per acre. • One of the concerns that may have prompted affordable housing restrictions in the first place, concern about rapid speculation in housing prices, has not occurred and is not likely to occur in the near future. Market adjustments have eliminated this possibility. By virtue of the current real estate market conditions, all homes in this project are significantly more affordable in 1996 than they were in 1991. See Exhibit `B" attached. � -fib VILLA ROSA PROJECT Page 2 • It has been extremely difficult to find buyers who have both enough income to qualify for loans and yet low enough income to meet the specific restrictions of the Affordable Housing Program. • The original Affordable Housing Conditions provided that four (4) units be sold at a 35% discount with the remainder of the required Affordable Housing units be sold at a 5% to 30% discount. See Exhibit "A ". Four (4) units have been sold at the required 65% of market, thus meeting the 35% discount requirement. Given the current sales levels it is evident that market rate discounts to general sales are in the 20% to 30% range. It is very evident that future sales prices will be significantly below the levels required to meet the original Affordable Housing Conditions. • While not a concern to the City, it should be noted that considerable monetary losses have been incurred by both the original developer (loss of $1,600,000.00) and the present owner (loss of $1,927,045.00 to date). • The California Department of Housing and Community Development recently issued a interpretive letter which encourages local governments to remove or undo land use regulations that unnecessarily constrain housing development. See Exhibit "D" attached. Continuation of the Affordable Housing Condition for Villa Rosa will most definitely constrain its development and completion. • Removal of Affordable Housing Conditions by various cities and local agencies is not without precedent. Attached Exhibit "D" shows a recent action by the City of Santa Maria on a similar project that we are involved with. ,f.1/ EXHIBIT A VILLA ROSA AFFORDABILITY PROVISIONS Affordability Program At least 41 of Villa Rosa's 85 units will be sold following the affordability provisions listed in Tables A and B on the following pages. The affordability provisions shall be administered by the San Luis Obispo Housing Authority (or other appropriate non- profit housing agency approved by the City), and shall be enforceable by the City as a condition of Planned Development rezoning PD 1518. "Recapture" Fee The developer has included a provision to "recapture" some of the original discount at time of resale, which is to be given to the San Luis Obispo Housing Authority (or some other appropriate non - profit housing agency approved by the City) for the construction, acquisition or write -down of affordable housing units. At the time of the first resale of discounted units, twenty (20) percent of the profit from the resale shall be placed by the owner into a fund to be used for affordable housing. The developer will submit a plan for implementation of the recapture fee to City prior to occupancy of the units, for the review and approval of the Community Development Director. i 2 "1 Exhibit a, Page 2 TABLE A PROJECTED SALES PRICES FOR DIFFERENT INCOME LEVELS* (revised) Sales Price (Percent of Market Value) 95% 90% 80% 75% 70% 65% Maximum Income Maximum Resale Price (1) Maximum Income of Eligible Buyers (2) 1 100% 150% 140% of Eligible Buyers 150% 140% 120% 110% 100% 80% (Percent of Median Income) 120% 1100/. 100% 3 115% Minimum Number 165% 140% 130% 115% of Units to be Offered 4 175 %° 11 11 4 (2) in Category (1) 5 *see notes, p. 3 (3) 175% TABLE B RESALE CONTROLS SCHEDULE (revised) ORIGINAL SALES PRICE (% of Market Value) 95% 90% 80% 75% 70% < -m> Term (Year of Resale) Maximum Resale Price (1) Maximum Income of Eligible Buyers (2) 1 100% 150% 140% 120% 110% i00% 2 100% 150% 140% 120% 1100/. 100% 3 115% 175% 165% 140% 130% 115% 4 I 115% 175 %° 165% 140% 130% 115% 5 125% (3) 175% 150% I 140% 1251/6 6 125% - 150% 140% 125% 7 135% I - - 165% 150% 135% 8 135% - - 165% 150% 135% ;t35. ° %i' < 9 150% - - 165 °10 150% 10 150% - - 150% 11 165% - - - e.:....... 85.....:... 12 165% - - - - > >365/a'3 >> >12 - - - - - - (1) (% of Original Sales Price) x (% Change in Median Income Levels) + Brokers Fees (2) %of Median Income (3) - = No Resale Controls Exhibit 4, Page 3 Note: (1) A total of 41 units will be offered at prices below market rate; with the exception of the 65% sales price catagory, more units may be offered in each of these categories than the numbers shown here (depending on demand and the order of the waiting list), provided the total number of units sold at below market prices equals 41. (2) In this category only, this number also represents the maximum number of units available. EXHIBIT "B" VILLA ROSA ORIGINAL MARKET PRICE MOST RECENT SELLING PRICE PERCENTAGE OF ORIGINAL MARKET PRICE PLAN A $162,000 $127,000(2) 78% X B $170,000 $136,000(2) 80% X C $186,000 $135,000(1) 72% X D $188,000 $151,000(1) 80% X E $195,000 $155,000(1) 79% (1) Recent sale (2) Current Listing Price. No "A" units sold since May, 1994 No `B" units sold since April, 1994 .2 .'?jr t`es 1333 CR PEPT. OF ri J-Gl"G Cri.L� 1014,:9NF1-r0.C_1k. T OP HOUSING AND COMMUNITY DOIE- OPMEN'T THE DIRECTOR STRPZr, Suite 4SO 2031 ?4252-2 USX MS �YJS 9163 313 -2SIS IJj'V[.T7 IT 6609 November 16. 1995 Daniel R. Lloyd, President Building1ndustry Association of the Central Coast P.O. Box 6180 Santa Maria, CA 93456 Dear Dan: _ Pe,rr.wtL�oK oo...,o. aM; Thank you for your letter of Octobcr 26, 1995 regarding local incluslOnary `sitting restrictions and Lite role of the Department ofHousinz and Community Development ( "the Department ") in reviewing local land -use and regulatory decision making. As you know, Governor- Wilson has committed his Administration to work to undo the lane!& of governmental regulation in California that has been choking the state's economy for more than a decade. As part of that effort, the Department has used state housing elcntent late try encourage local governments to remove or undo land -use policies and regulations which r,nnecessarily constrain housing dovelopment. Thost: constraints translate into hidden taxes Icvied on both producers and consumers and have helped make California housing markets among the lease affordable in the nation. I'm happy to report that compliance with housing element law has more than tripled over the last four years which has helped reduce regulatory barriers in local Maikela• - . However, many communities continue to practice policies and programs which unduly burden housing dcvOopment. Among those is inclusionary zoning. While the goals of inclusiunaty zoning may be laudable, the means rypieally employed to accomplish them represent at best still another tax on housing construction and, at worst, classic social engineering which distorts the economics of local housing markets and unfairly imposes a community's social welfare burdens on a few builders. and unsuspecting homebuyers. The Department considers inclusionary zoning to be a constraint to cite developmont of housing, and tluoup,h its housing element law review process identifies it as such. The suggestion that the Department would litigate to enforce the adoption or implementation of an inclusionary zoning ordinance Is without either logical or legal basis. Accordingly, you are advised that the Department would not pursue litigation (or any other meaae) to enforce local inclusionary zoning. ';,V- 17 —•,�� gr4T C. +M s 17 V T n ._ ? - - wo, G 6'! i ? -SY3; 13 �j ca L rr. GF HCxpSING (HCrJ) A Dan Lloyd November 16, 1995 Paso 2 I hope this adequately responds to your October 26 letter. rf you hav-- any qucstinnc please call me or Juan Acosta, Chief Counsel, at 445 -4775• Very sincerely yours. Timoth . Coyle Director cc: John bowler Bennis Morosco P- 02 t:F.,T V1 BUILDING INDUSTRY ASSOCIATION OF THE CLNIRAL COAST P.O. Box 6180 - Santa Maria. CA 93456 (8)5) 928 -7196 FAX (865) 928 7667 - October 26, 1M5 EXHIBIT "C" Timothy Coyle, Director California Department of Housing & Community Development Sacramento, CA 94252 -2053 - rr Re: Modification or Elimination of Affordable Housing Requirements for Local Ifousing Project Dear Tim: In order to meet local housing goals established in conjunction with local housing elements, communities have frequently mandated that projects Include affordable' housing regardless of the prnjr:cr type. Often referred to as Inclusionary zoning or Inclusionary Rousing, these local policies have mandated that market -rate housing, in effect, subsidize a contrnunily's affordable housing • goal. The building 'Industry understands that this Is not the policy of your department: however, local agnncids have perhaps taken the mora expedient route and saddled .0 guod number of project with this kind of requirement. Recently, local agencies are beglnnln.7 to understund the consequences and hurdnns that incluslonury policies have on the provision of housing in their communities, and are benlnnincJ to rclax the standards. However, for projects dial were previously approved that have Inclusionary requirements, they fear Iliat your agency may pursue legal action to enforce the iriclusfonary provisions of their approval. This {guts us In a difficult position since everyone rocognizes the value of mcxlifying these requirements, yet tite agencies are reluctant to proceed because of the fear of stilt by your department. In ortJer to assuage the concerns of these local conttttunities, we tent you may be able to provide sortie assistance. .vo recognize It has never been your depotuncnt's requirement or mandate that Inclttsionaty zoning /housinn hr•.r:ome the vehicle to achieve locul ulturdable housinf7 f7nal. 1 inwover, many local agencies fear legal action froril your derlanmont it they relax their own rnlir:Inc. We would greatly appreciate a rwsrnnse from your office regarding this issue since we hPlirvn it will encouroge local agencles to move forward In providlncl housing that is desperately needed In ntir arrw. Anything you can do to clarify your deuarinient's position oil this topic will be greatly appreciated. It you have any questions regarding our particular circumstances. you can contact rite or John Fowler, of our organiartion, et (1105) 545 -8817. Sincerely, BUILDING INDUSTRY ASSOCIATIONS Daniel R. Lloyd President cc: John f -owler Dennis Moresco txt \tn%C....tr "■, .2 �2$ EXHIBIT "D" C I Y ED FEB 2 g Fagg PIN CITY OF SANTA MARIA COMMUNITY DEVELOPMENT DEPARTMENT 110 S. PINE STREET, #101 (ON HERITAGE WALK) • SANTA MARIA, CA 93454 -5082 • (805) 925 -0951 February 22, 1996 �- Jeffrey C. Nelson Mullen & Henzell P.O. Box 789 Santa Barbara, CA 93102 SUBJECT: HIDDEN PINES ESTATES, TRACT 5591 The Planning Commission, at their regularly scheduled meeting of February 21, 1996, deleted the affordable housing condition for the above mentioned project. This modification of the conditions of approval is set forth in Planning Commission Resolution 2081. If you have any questions regarding the preceding information, please contact me. /� n - - /;�/z - MARC P. BIERDZINSKI, AICP, PLANNER II COMMUNITY DEVELOPMENT DEPARTMENT MPB /lb Enclosure cc: Mid -Coast Land Company L2- LNELSON2 a -;z9 FAX: Administration (805) 349 -0657 . Communiry Development (805) 928 -7565 • Public Works (805) 928 -6632 RECEII'Fn P�q 2 199b EXHIBIT "D" RESOLUTION NO. 2081 A RESOLUTION OF THE PLANNING COMMISSION OF THE CITY OF SANTA MARIA MODIFYING THE CONDITIONS OF APPROVAL OF HIDDEN PINES ESTATES, TRACT 5591, RELATING TO THE PROVISION OF 23 AFFORDABLE HOUSING UNITS, LOCATED ON HIDDEN PINES WAY AT BOXWOOD STREET WHEREAS, the City Council of the City of Santa Maria approved the official tentative map for Hidden Pines Estates, Tract 5591, on March 19, 1991, and imposed conditions of approval as noted in the aforesaid City Council Approval; and WHEREAS, the Planning Commission of the City of Santa Maria held a regularly scheduled public hearing on February 21, 1996, for the purpose of considering an amendment to the conditions of approval for Tract 5591, and WHEREAS, the amendment under consideration relates to the provision of 23 affordable housing units; and WHEREAS, the project applicant has requested that said condition be deleted; and WHERAS, the Planning Commission concurs that the affordabe housing condition is no longer necessary based on the information provided by the applicant; and WHEREAS, notices of said hearing were made at the time and in the manner required by law; and WHEREAS,_ at the completion of said hearing the Planning Commission duly considered all evidence presented at said hearing. NOR, THEREFORE, BE IT RESOLVED that the Planning Commission of the City of Santa Maria hereby finds that the affordable housing condition is no longer required for Tract 5591 and is deleted in its entirety. ..z -I 1?rf'F1VT'D PROJECT DESCRIPTION Modification of the conditions of approval of Tract 5591, Hidden Pines Estates, relating to the provision of 23 affordable housing units. PASSED AND ADOPTED at a regular meeting of the Planning Commission of the City of Santa Maria held February 21, 1996, by the following roll call: AYES: Commissioners Bill Perry, Larry Lavagnino, Nancy Johnson, Chuck Oberdeck, Trent Benedetti NOES: NONE ABSENT: NONE ATTEST: BILL PERRY, Chairman City Planning Commission JAMES W. STERN, Assistant Secretary City Planning Commission L2A- ResT5620 12 -3/ ORDINANCE NO. 1197 (1991 SERIES) AN ORDINANCE OF THE CITY OF SAN LUIS OBISPO APPROVING A PRELIMINARY DEVELOPMENT PLAN AND REZONING PROPERTY AT 843 MUTSUHITO AVENUE FROM M TO R -3 -PD (PD 1518) WHEREAS, the Planning Commission and the City Council have held hearings to consider the appropriate zoning on the subject property in accordance with Section 65800 et. seq. of the California Government Code; and WHEREAS, the Planning Commission has found the rezoning to be consistent with the General Plan and recommends City Council approval of the preliminary plan and rezoning; and WHEREAS, the proposed plan and rezoning have been evaluated according to the California Environmental Quality Act and the City's Environmental Guidelines, and has been granted a negative declaration (ER 15 -91); and WHEREAS, the proposed rezoning promotes the public health, safety, and general welfare. NOW THEREFORE BE IT ORDAINED by the Council of the City of San Luis Obispo as follows: SECTION 1. Findings. 1. The proposed general plan amendment and PD rezoning are consistent with the adopted policies in the Land Use and Housing Elements of the General Plan. 2. The proposed land use is appropriate at this location, and will be compatible with existing and allowed land uses. 3. The planned development will not adversely affect public health, safety and welfare. 4. The planned development provides more affordable housing than would be possible with conventional development. 5. Features of the particular design achieve the intent of conventional standards (privacy, usable open space, adequate parking, compatibility with neighborhood character, and access to adjacent commercial uses) as well as or better than the standards themselves. I ' SECTION 2. Environmental Determination. The proposed preliminary development plan and rezoning have been evaluated under the city's Environmental Guidelines and the California Environmental Quality Act, and the council hereby affirms the Community Development Director's determination that the project will not have a significant adverse impact on the environment (ER .2-J,? n_1io7 Ordinance No. 1197 (1991 Series) Page 2 15 -91) provided that the following mitigation measures are incorporated into the project: Land Use A. Developer shall provide a minimum setback of 20 feet from the building walls or exterior patios for units 79 - 89 (Building 9) to the south and west property lines, with an architecturally compatible fence or wall, and a 10 -foot wide landscaped planter for visual screening and physical separation. B. Developer shall provide a minimum building setback of 20 feet for unit 31, and provide a noise attenuation wall along the property line between Mutsuhito Avenue and the north corner of the proposed Orchard Supply Hardware (OSH) store to protect residential uses from vehicle traffic and loading noise. The noise wall shall be architecturally integrated with the project using landscaping and architectural detail, to the approval of the Architectural Review Commission. C. Residential units with wall openings facing the C -S zone shall incorporate construction measures to ensure interior noise levels do not exceed 45 dBa (Ldn), to the approval of the Chief Building Official. An acoustic engineer shall recommend appropriate design measures for the .units so that the 45 dBA sound level is not exceeded, and these measures shall be incorporated in the building plans. Such measures may include, but are not limited to double glazing, reduced window area, enclosed outdoor patios, and special wall assemblies. D. A declaration to buyer shall be included in California Department of Real Estate documents prepared for prospective buyers. The declaration shall advise buyers that the project is located adjacent to manufacturing and service - commercial uses, and that occasional industrial noise and related activities may occur. Traffic and Circulation Developer shall: E. Contribute toward the cost of installing a signal at the Lawrence Drive /Broad Street intersection, prior L to construction permit issuance. Contribution amount shall be calculated by the City Engineer, and shall be based on the project's proportionate share of the total traffic increase (ADT) on Broad Street from Villa Rosa, OSH, and Stoneridge II, not to exceed 25 percent of the total cost of the signal project. 2.33 ordinance No. 1197 (1991 Series) Page 3 F. Revise project design to provide a public street connection between Lawrence Drive and Mutsuhito Avenue via Victoria Avenue. Developer shall improve Victoria Avenue to city standards. G. Contribute toward the cost of installing a second eastbound left -turn lane from Broad Street onto Orcutt Road, prior to construction permit issuance. Contribution shall be calculated by the City Engineer, and shall be based on the project's proportionate share of the total traffic volume (ADT) on Orcutt road. H. Contribute toward the cost of widening Orcutt Road to four lanes east of Broad Street, prior to construction permit issuance. Contribution shall be calculated by the City Engineer, and shall be based on the project's proportionate share of the total traffic volume (ADT) on Orcutt Road. I. Contribute toward the cost of installing a grade separation at Orcutt Road and the Southern Pacific Railroad right -of- way, prior to construction permit issuance. Contribution shall be calculated by the City Engineer, and shall be based on the project's proportionate share of the total traffic volume (ADT) on Orcutt Road. J. Revise the Orcutt Road driveway exit to restrict access to right -turn in and right -turn out only, to the approval of the City Engineer. Air Quality Developer shall: K. Incorporate bike and pedestrian trails into the Villa Rosa design to provide the opportunity to connect with a planned citywide bike trail in or along the Southern Pacific Railroad right -of -way, near the northeast corner of the site. L. Grant irrevocable public pedestrian and bicycle access easements from Broad Street to the future connection point at the site's northeast corner and along the former Pacific Boast Railroad right -of -way, and install footpath and bikeway improvements as approved by the Architectural Review Commission. M. Contribute toward cost of installing a transit facility on the east side of Broad Street between Lawrence Drive and Orcutt Road. Costs shall include construction of a standard bus turnout, transit shelter, bus sign, trash receptacle, and z _J y ordinance No. 1197 (1991 Series) Page 4 installation of public art and appropriate landscaping. Contribution.amount shall be calculated by the City Engineer, and shall be based on the project's proportionate share of the total traffic increase (ADT) on Broad Street from OSH, Villa Rosa, and Stoneridge II, not to exceed 25 percent of the improvement's total cost. N. Follow APCD guidelines to reduce fugitive dust emissions during grading and site preparation, and exhaust emissions from construction equipment. Prior to construction permit issuance, the developer shall submit a plan describing measures to be taken during construction to reduce emissions, to the approval of the Community Development Director. Plant Life O. Site design shall be modified where feasible to preserve Eucalyptus trees, to the approval of the City Arborist and the Community Development Director. Where preservation is not feasible, the 15- gallon sized trees to be removed shall be replaced on a two for one basis with trees of a comparable ultimate size and longevity. Historic Resources P. A qualified archaeologist will .instruct the project's construction contractors in how to recognize resources that my be encountered. If excavations encounter archaeological resources, construction activities which may affect them shall cease. The Community Development Director shall be notified of the extent and location of discovered materials so that they may be recorded by a qualified archaeologist. Disposition of artifacts shall comply with state and federal laws. A note concerning this requirement shall be included on the grading and construction plans for the project. Q. Brick work shall be incorporated into the development of the site to recall the historic use of the site. R. The historic significance of the site, including street names, shall be documented through the use of a plaque, photographs and samples of the brick work incorporated into a marker or kiosk on the project site for public display, possibly in cooperation with the adjacent Orchard Supply Hardware project. General S. If the Community Development Director determines that the above mitigation measures are either infeasible or ineffective, the Director may modify the measures or add 2 -3S Crdinance w0. 1197 (1991 Series) Page 5 additional measures to better achieve the intent of the original mitigation. SECTION 3. Preliminary Development Plan. The preliminary development plan for Villa Rosa, an 85 -unit planned residential development, is hereby approved subject to the following conditions: 1. Within six months of preliminary development plan approval, the applicant shall file a final development plan as required by the Zoning Regulations. Said plan shall be consistent with the project's approved tentative tract map and final Architectural Review Commission approved plans. 2. Developer shall sell the units following the affordability provisions described in Exhibit "A ", to the approval of the Community Development Director, and the developer shall administer the sale and re -sale of affordable units through a non - profit housing agency to be approved by the City. 3. Victoria Avenue shall be improved within the existing right - of -way to provide a minimum paved width of 28 feet, with sidewalk bulbouts on both sides of Victoria Avenue and a textured, colored concrete crosswalk where the main walkway crosses Victoria Avenue. A minimum street yard of 15 feet shall be provided. 4. Fire Department setback requirements for residential structures from the high pressure gas pipeline on the site shall be observed. 5. Verification of compliance with hazardous materials requirements shall be provided prior to construction permit issuance. SECTION 4. Zoning Map Amendment. The Community Development Director shall amend the Zoning Map for property located at 843 Mutsuhito Avenue tq change the designation from M to R -3 -PD, as shown Exhibit "B." SECTION 5. Publication. This ordinance, together with the names of councilmembers voting for and against, shall be published once in full, at least (3) days prior to its final passage, in the Telegram- Tribune, a newspaper published and circulated in this city. This ordinance shall go into effect at the expiration of thirty (30) days after its final passage. INTRODUCED AND PASSED TO PRINT by the Council of the City of San Luis Obispo at its meeting held on the 20th day of August .- 1 1991, on motion of Councilwoman Rappa . .Z -36 Ordinance No. (1991 Series) Page 6 seconded by Councilwoman Pinard vote: and on the following roll call AYES: Councilmembers Fappa, Pinard and Mayor Dunin NOES: None ABSENT: Councilmembers Reiss. and Roalman �' c Mayor Ron Dunin ATTEST: �D4—nncL (I AIX.. C'ty Clerk 0 , APPROVED: City A inistrative Officer ity Dgvolopment Director .2-37 m r C` c' at r N 5 .l 0 O OR W � � Y N W N Z O U N �o N •v— r � • J , e R r- W C < J W Z� c t W I N ; t y� t a %O s i + w� c t, t, � V J• 2 .�• 8 y i5 I 1 1 m N t� _ I� 1111:11: Ilu: Nt 6 % %'•��i llt:t :::�, •, a !- e t Ell ......l' I�u,�MH ttJi1(1►( •dI'C ., `9 FIN 3 AS_—C=lIIn SInrG ,1• ,� •i I C I I 1 W I NIL - •I •�. � '75.1'1 ' � � � . t t v .1 t y� t a %O s i + w� c t, t, � V J• 2 .�• 8 y i5 I 1 1 m .. ... i � J 3�ItltJ 3'JN3tlMr1 I N I� 1111:11: Ilu: Nt 6 % %'•��i llt:t :::�, •, a !- e t ......l' I�u,�MH ttJi1(1►( •dI'C ., `9 FIN 3 AS_—C=lIIn SInrG ,1• ,� •i I C I I 1 W I .. ... i � J 3�ItltJ 3'JN3tlMr1 I I !— 3; t fe [=• a [L i }�i i 1 1111;111 I 1 {111 � I IJililli I {(il I.I�F -38 N I� 1111:11: Ilu: Nt 6 % %'•��i llt:t :::�, e t ......l' I�u,�MH ttJi1(1►( I !— 3; t fe [=• a [L i }�i i 1 1111;111 I 1 {111 � I IJililli I {(il I.I�F -38 2. 843 Mutsuhito Avenue: (PD 139 -96): Amendment to the Planned Development 1518 for the Villa Rosa development to remove the affordable housing requirement; R -3 -PD Zone; Mid -State Bank, applicant. E Chairman Karleskint designated Commissioner Whittlesey as Acting Chairwoman. Commissioners Senn, Ready, and Chairman Karleskint refrained from participation due to potential conflicts of interest, and left the meeting. Associate Planner Jeff Hook presented the staff report, recommending that the Planning Commission support an amendment to the Villa Rosa residential planned development to modify its affordable housing requirement to meet the Housing Element policies. Commissioner Veesart questioned the reduction from 41 to 26 affordable units. Associate Planner Hook referred the Commission to the attached to the schedule in the staff report which was approved with the PD, and he showed the chart that established resale controls for the "affordable" condominium units. He outlined the income levels that would be eligible to purchase the discounted units, and noted that 15 of the 41 "affordable" units, although discounted, would not qualify as affordable under the City's standards because there were priced for above moderate incomes. Commissioner Kourakis asked if staff feels Alternative 1 better meets Housing Element policies. Associate Planner Hook said yes, that Alternative 1 would maintain some affordable units in Villa Rosa for at least 30 years. Commissioner Kourakis asked since income levels are mixed, has there been any problem with the homeowners' association fees. Associate Planner Hook said he wasn't aware of any problems. Commissioner Jeffrey asked under Alternative 1, if we use the basis of 59 units as opposed to 85 units, would the development still meet today's requirements for affordable housing. Associate Planner Hook explained that staff used 85 units as the basis for the affordable housing requirement, since the eight affordable units already sold do not meet the City's minimum 30 -year affordability term. Commissioner Veesart noted the City discounted this project in fees by approximately $17,000 and also rezoned this property from industrial to residential. He asked if there was an estimate of the property's original increase in value due to rezoning. 2 -34 Draft Planning Commission Minutes January 8, 1997 Page 2 Associate Planner Hook said that he did not have that information. Commissioner Kourakis remembers the original project as being unique and that the original developer, Stan Bell, felt quite strongly about limiting the affordability term to 12 years so that property owners could build equity. What the City had approved was a project which gave some lower income households the opportunity to buy homes and to control that investment themselves after a certain period of time, with some constraints. Associate Planner Hook added this affordable program was unique because it was privately funded. When the market changed and housing prices in San Luis Obispo dropped, sales prices of the recently sold, non - discounted units were actually below the levels deemed affordable for moderate income households, according to City standards. Staff felt it was important to consider Housing Element policies calling for safe, high - quality environments for residential projects, and that current Villa Rosa residents had bought their units expecting that there would be recreation and common areas, and other amenities that won't get built until the project is completed. Staff feels that amendments to the Villa Rosa affordable housing requirement would be consistent with the General Plan and that it would be in everyone's best interest to work together to get the project done. PUBLIC COMMENTS: Carrol Pruett, Executive Officer of Mid -State Bank (MSB), 1026 Grand Ave., Arroyo Grande, stated they are asking the Commission to modify the affordable housing element for this project. They intend to sell the undeveloped lots to a developer who will finish the project out. The undeveloped project is not doing anybody any good sitting there and the property becomes less desirable the longer it remains undeveloped. It is a burden on the existing homeowners who bought in good faith. MSB are precluded by law from developing the property themselves, even though they own it. The project just isn't going to get completed unless the affordable housing requirement is modified. He said they have been trying diligently for two and a half years to do this. When they took the project back, there had been 26 houses built, 16 of them sold, eight of these under the affordable housing program, including four units sold under the very low income level. If this goes forth under one of the alternatives, it will continue to provide affordable housing to the city. There are 12 -year restrictions on the resale, but there is no restriction on how long the 20 percent recapture fee applies. Upon the first resale of the discounted units, 20 percent of the sales profit would go to a City housing trust fund for expanding affordable housing opportunities. Mr. Pruett stated they are in agreement with staffs proposed plan except on one point. The required number of affordable housing units in Alternative 1 is based on the original .2-410 Draft Planning Commission Minutes January 8, 1997 Page 3 number of units in the PD, or 85 units. In as much as eight affordable units were already constructed and 59 units are remaining to be built, they feel that the new affordable requirement should be based on the 59 units, not the 85 units. They want to get the project completed and so do the homeowners. Commissioner Jeffrey asked Mr. Pruett if the base for Alternative 1 were change to 59 units, would he be willing or able to stipulate that those could be dedicated to low- income units. Mr. Pruett stated that part of the problem of providing affordable low- income condominium units is that the homeowners' association fees are rather substantial. Qualifying low- income households, on the basis of income to support loan payments and the homeowners' association fees is difficult, even if those households can afford the downpayment and closing costs. It may be difficult to find a developer if Alternative 1 required all low income units, without any moderate income options. Associate Planner Hook stated the City's standards allow a range of affordability and the whole intent of Housing Element Table A was to allow flexibility in meeting the City's affordable housing goals. Staff is recommending that the condition be modified so that the developer must meet the affordable housing requirement in Table A. Associate Planner Hook added that there are two existing programs which can also help prospective buyers for Villa Rosa condominiums. The countywide First Time Home Buyers Assistance Program helps first -time buyers by units costing up to about $157,000, and there is also the Mortgage Credit Certificate Program which provides tax benefits for homebuyers. Commissioner Veesart asked if the problem is the difficulty in finding a buyer because of the recapture fee provision or the 12 -year affordability provision, or is it that a developer can't make the project "pencil out" financially because of the number of units being sold below market value. Mr. Pruett stated the problem involves all three reasons. It is difficult to find home buyers who are willing to be subject to a sales price restriction for this period of time. Commissioner Veesart asked if the market hadn't turned, would this affordable housing program have worked, and if the market turns again would it work.? Mr. Pruett felt that the program wasn't working when the market was good. Commissioner Kourakis asked if MSB wanted to use 59 units as the base number for the affordable housing requirement. A-V/ Draft Planning Commission Minutes January 8, 1997 Page 4 Mr. Pruett replied yes. They would like as much flexibility as possible. Donald Dana, 1502 Helena, Halcyon, serves on the Board of Directors of the FUERZA. FUERZA is a community based nonprofit advocacy group for lower- income families. They are in opposition to the removal of the affordability requirement. He sympathizes with the position of Mid -State Bank, but they will oppose any reduction in the city's stock of affordable housing. This development has received some concessions from the City and this implies that would be a certain number of units. From the original plan, there is a net loss of 14 -16 affordable units. He requested the City and the private market make a concerted effort to develop housing in the city that is affordable to people of all income ranges and not just those of moderate- and upper- income ranges. Tobias Chipping, 555 Ramona, stated there are quite a few affordable houses in town that remain vacant throughout the year. Steve Delmartini, 1091 (Inaudible) St., concurred with Mr. Pruett's comments. He felt that the only way this project would sell to a developer was if the affordable housing requirement was set at five moderate - income units. He felt it may be difficult for low - income households to afford housing here. There was a good effort made by everybody to make this work, but it just didn't happen. The 20 percent recapture fee for up to 12 years is fine for the eight affordable units already sold, but he wouldn't expect that requirement to be carried on for anybody who goes into a moderate income unit from here on out. He would like to see the project completed, and believed that Mortgage Credit Certificates are a good product, but are not always available. Commissioner Jeffrey asked Mr. Delmartini to comment on some of the problems he's had to deal with, as sales agent for Villa Rosa. Mr. Delmartini stated timing seems to be everything in the real estate market. The attractiveness of the affordability program did bring in buyers initially, and this was the biggest plus to the development. The difficulties have been that not everybody liked this location due to nearby industrial and commercial uses, the homeless shelter, and the railroad tracks. The main difficulty was the real estate market itself, and sales soon fell off for the non - discounted units. Commissioner Jeffrey asked what were some of the amenities that were initially conveyed that haven't been delivered yet. Mr. Delmartini stated there was a half -court basketball court, two greenbelt areas, two car wash locations, privacy fencing, the finishing of streets, and landscaping that came along with the development. .2 -V4 Draft Planning Commission Minutes January 8, 1997 Page 5 Barbara Span, 2919 Girabaldi Ave., is a resident of Villa Rosa. She is in support of getting the rest of the units built. She is the president of the homeowners' association and hears the complaints about the potholes in Villa Rosa's streets. They can't really do anything until a developer comes along. She does like the project and feels her condominium is great. The public comment session was closed. COMMISSIONERS' COMMENTS: Commissioner Jeffrey moved to recommend to the City Council that they amend the Villa Rosa planned development per staffs Alternative 1, based on Policy 1.22.17 of the Housing Element. The motion failed for the lack of a second. Commissioner Veesart is sympathetic to the bank and is swayed by their arguments that the marketability is not there. He felt the City made concessions to make this project happen by waiving some fees and by deferring others, and by allowing a zoning change. Somebody got some benefit from the City, and in return for those benefits, they made a promise that they were going to provide affordable housing. They didn't follow through on the promise. He was concerned about precedent being set by deleting the affordable housing requirement, and was upset by the exchange of letters between Daniel Lloyd and Timothy Coyle which were in the agenda packet. He would be inclined to reduce some of the restrictions on the property, but he's not sure that he's inclined to go far as staff recommended. Acting Chairwoman Whittlesey asked if there are other projects that might come forward with similar requests. Associate Planner Hook stated there are no other projects in the city where the City required a specific number of for -sale affordable housing units. In other residential projects, the City typically has required the dedication of land for public housing. Acting Chairwoman Whittlesey reopened the public comment session to hear from George Moylan, Executive Director of the City's Housing Authority. PUBLIC COMMENTS: George Moylan felt that realistically, there was no lower income, for -sale housing in the City. We have upper- income housing and middle- income housing. Affordable rental housing we do have, but that's not the same as housing affordable for low- income households to purchase. From the start of this development, he was in support. From the Draft Planning Commission Minutes January 8, 1997 Page 6 Housing Authority's perspective, any affordable housing provided with this development would be a plus, since there was no federal or state money involved. He felt the affordable housing program would have been successful if the real estate market had remained strong. People of low income are not going to be able to live in this project, even with down payment assistance or Mortgage Credit Certificates. He felt that if the City can secure four or five long-term affordable units at this time, it should do so. Seeing no further speakers come forward, the public comment session was closed. COMMISSIONERS' COMMENTS: Commissioner Kourakis asked what the City would do with the 20 percent recapture fees. Associate Planner Hook stated it would be set up as a revolving fund to help pay for land acquisition and infrastructure for affordable housing. Commissioner Jeffrey moved to recommend to the City Council that they amend the Villa Rosa planned development per staff s Alternative 1, based on Policy 1.22.17 of the Housing Element. The motion was seconded by Commissioner Kourakis. Commissioner Jeffrey was concerned about the loss of affordable housing. The one variable that is missing is the fact that the developer original is no longer participating. Commissioner Veesart was concerned about the lowering of the number of low- income units. Acting Chairwoman Whittlesey didn't feel that it was the affordable housing component that sold this project to the Planning Commission. This project was a much -need residential development, and Mr. Bell's affordable housing commitment certainly made it a more attractive development. The vision for this project was grander than what the real estate market ultimately could support. It was an overall good housing project and it met some needs. She wishes it had worked and the market had held. Right now, she felt the Commission was faced with a situation where we're not going to get a built out neighborhood, and the residents were not going to see the completed project without some flexibility on the City's part. She wants this project to move along. AYES: Commissioners Jeffrey, Kourakis, Veesart, and Acting Chairwoman Whittlesey NOES: None ABSTAIN: None REFRAIN: Commissioners Senn, Ready, and Chairman Karleskint The motion passed 4 -0 -3. 2 -Vf Draft Planning Commission Minutes January'8, 1997 Page 7 ADJOURNED at 10:15 p.m. to a regular meeting of the Planning Commissiog 'scheduled for January 21, 1997 at 7:00 p.m, in the City/County Library, 995 Palm Street, San Luis Obispo; California: Respectfully submitted, Lea}a K. Magee Recording Secretary J-Hr - &#At . #/ Benin, Jan ................................... California Specialized Training Institute Blanke, Dan ........................... ............................... SLO PD Bowman, Leslie ...................... ............................... Transitions Briggs, Marney ......... ............................... EOC Health Services; TAPP Brown, Brad ................... ............................... Teen Video Club Bryn, Rob ......... ............................... Planning, City of San Luis Obispo Burns, Jeannie ...... ............................... Principal, Laguna Middle School Ceaser, Chris ................... ............................... EOC, Teen Clinic Christianson, Richard ............................. Principal, Pacific Beach High School Cooper, Brandon ...... ............................... Student Laguna Middle School Cooper, Lori ... ............................... ..................... Grassroots Curtis, Delilah . ............................... Teen, Grassroots Community Volunteer Crocker, Lindsay ............ ............................... Middle School Student Crocker, Rick .................. ............................... ...... SLOPD Drucker, Sylvia .............................. Chamber of Commerce, Adopt a School Forshay, Leslie ............... ............................... High School Student Frojker, Andy .................. ............................... Tobacco Control Gillham, Sean ................. ............................... SLO PD.D.ARE. Griffin, Bob ........ ............................... President, Chamber of Commerce Harvey, Bill ................ ............................... Laguna Middle School Hays, Tim ................. ............................... SLOPD School Officer Herrera, Vera .................. ............................... Housing Authority Heur, Till ... ............................... Student Services, San Luis Coastal District Hurd, Nancy ........ ........:......... Community Volunteer,Cuesta College, Instructor Jones, Ricci ...... ............................... Narcotics Anonymous, Grass Roots Klotz, Jack . ............................... Drug & Alcohol Services, StarCar Project Krugh, Allyson ................ ............................... Parent, Grassroots La Barre, Mila ........... ............................... SLO High, 24 Hour Relay Lawrence, Joan ................... ............................... Juvenile Justice Lum, John .......... ............................... Probation Department, Director Morris, Jay ......... ............................... Grassroots, Crux Climbing Gym Negranti, Bob ......... ............................... EAP Health Center, Cal Poly Peracca, Mary ............................ Drug and Alcohol Services, DUI Task Force Phillips, Linnea .................................................... Linnea's Cafe Pinard, Peg ................. ............................... Board of Supervisors Pucciarelk William ............ Division Manager, SLO Probation PC -1000 Drug Diversion Ramsey, Mike ........... ............................... SLO Parks and Recreation Reynolds, Dan ........... ............................... Lifesteps Runaway Center Robinette, Rick ........................... Vice - Principal, San Luis Obispo High School Roether, Tim .................. ............................... Housing Authority San Fellipo, Ken ........... ............................... Dean, SLO High School Settle, Allen ........ Mayor Shalenberger, Don ............................. Principal, CL Smith Elementary School Silva, Bud ............................ ............................... SLO PD Sloan, Steve .................. ............................... Housing Authority Smith, Devin .. ............................... ...... Middle School Student VG.7=Xwpd=Nj=yor� w FEB 4 t77/ Smith - Williams, Elaine ... ........................ Grx ots, Community Volunteer Trautman, Tracey ................. ............................... National Guard Warren, Frank .................. ............................... Friday Might Live Went7, Janet .......... ............................... Principal, Hawthorne School Willard, Connie ........ ............................... Children's Services Network Willard, Nick ............... ............................... Middle School Student Williams, Dawn .................. ............................... Latino Outreach VG pm \wpd=\maym4mdw MAYOR'S YOUTH TASK FORCE The San Luis Obispo Youth Task Force was initiated, in January; 1996, when Victoria Gheza was hired as a Community Organizer through a Center for Substance Abuse Prevention (CSAP) grant received by the SLO County Drug & Alcohol Services. Victoria's assignment was to bring the City of San Luis Obispo to the table to address the alcohol, tobacco and other drug abuse issues important to this community. The charter members of this task force included school personnel and administration, city law enforcement, SLO City Parks and Recreation, concerned citizens, youth, and drug and alcohol prevention providers. They quickly began work to write a proposal for mini -grant funding and were awarded about $8000.00 to develop and launch a summer school program for 6th and 7th grade students identified as unprepared for High School. Victoria, in her continued quest to interest more and more community members in the present and potential work of this new task force, found Mayor Allen Settle interested and willing to endorse their work The name of the task group was subsequently changed to the Mayor's Youth Task Force. Mayor Settle has attended meetings and remained in close touch with the projects of the task force. Through the success of their first project, this task force has gained the momentum to apply for additional grant money t work on such projects as employment for youth, an expanded summer school to last throughout the school year, youth drug -free dances and activities, and other activities in collaboration with youth task forces in other parts of the county. They have achieved the notice of the community and expanded their ranks to more than 50 community members from all factions of the City of San Luis Obispo. The Mayor's Youth Task Force has recently been awarded $10,000 to complete a project that addresses youth drinking and driving issues. Collaboration for this project includes law enforcement, schools, business community, parents and youth. The energy and commitment of this group of people has made the Mayor's Youth Task Force a group respected for getting things done, modeling for the community a norm that does not include alcohol, tobacco and other drug abuse. They will continue to search for funding that will support their work throughout the City of San Luis Obispo and welcome collaboration with other groups and communities throughout the County of San Luis Obispo. For more information, please call Victoria Gheza at 781 -4290. _.. .. . :... PG&E:CQNTRIBUTIONS PROGRAM:. - DCPP, MBPP,,LosPAL)Ra DrvrstoN APPLICATION FORM ' Name. g `of Or anizatioh: San.Lujs Obispo Mayor's Youth.Task Force Address: ,1102 Laurel Lane, San Luis Obispo,'.CA :93401 contact Person and. Phone, Number:.:.; ,Victoria .Gheza,805 /781- 4290... Brief Description of . Program:- ' . The SLO Mayor's Youth Task Force. (MYTF) proposes to _ implement an effort in San Luis Obispo to,plan and. organize a full -scale youth employment service.(YES). •. Youth: service organizations-in the area provide a wide array of social; recreational; academic, and health.promotionprograms, yet a; "striking gap.in °these services'.. continues to be the lack of a: program aimed at training and placing young people. in part -time _ jobs,. This is despite the fact that successful vocational experience is one of the most critical components to self- esteem and good.citizenship. There is wide-spread community support fora youth :employment service, including educators, social and recreational programmers, business and professional people, and other community.. leaders. It is the contention of the MYTF that most of the resources necessary to implement a ' successful YES already exist in San Luis Obispo,.that :what is missing primarily is a concerted and.organized effort to bring the parties.together to plan.and•collaborate. The program. .. proposed here is designed to do just that. Additional. funding would.be required to insure proper implerrtentation of the YES, but the initial planning process "is crucial- to its success. The proposed program will result in a collaborative team, an organizational system, program components, and momentum toward securing continued funding Organizational . History, .Accomplishments; and Goals:.. The SLO 'Mayor's Youth Task Fo rice: was organized in January;1996 under the auspices of the SLO County Drug and Alcohol Service's CSAP grant program.. Members of the group include representatives from local schools, law'enforcement, SLO Parks and. Recreation- public and private. service providers, local.:. . businesses and professionals, concemed citizens, youth, and prevention providers. (See attachment for a list of t P he membershi .. ) The first MYTF program began .ih July;1996.•'The CARES.(Commitmeiit to At -Risk Educational Students). program. targeted young people at -risk of academic failure in the sixth through ' eighth- grades.. The pro' ramcombined. intensive academic training with "social and recreatiorial.experiences. _Parents were also involved- The program enabled 75% of its participants to move up to the next . grade level, and gave some of them their first experience with academic success.. The current.MYTF.prograai; reDUlce, utilizes committed high school . students to impact social norms; raise peer awareness; and prevent alcohol and' other.•drug use . The student participants in the CARES Program 'were very . enthusiastic about-the'possibility of part -time employment: Their interest,.alorig with strong support from public-and private . services providers, educators, and business'and professional people helped to shape the design.:'.' esign. "' , of the proposed program.. Target Population,., Goals;" and. °Objectives;: ;' The target population for the Youth Employment Service will be young l5dople, (14 t6-19) in San Luis Obispo. -.The program will be - . closed to no one, but will "primarily target at -risk youth, who "are expected to be referred from `. . CARES, reDUlce, TAPP, EOC Health. Services, SLO County Probation,-Laguna Middle School, . Pacific Beach High School, San Luis Obispo High.School, and other 'service agencres and tionalctnstitutrons:'.:- = - : > The proposed program- is intended to li'e• a- `tannin `endeavor. .Its siiccess. will 6e measured accordin to its abili. to achieve. the "followinng objectives; "1') Contact and'involve:appcopnate g'., ty organizations including,. PIC, EOCHealth Services, SLO Coastal -Union School District; SLO County Office of Education, SLO Chamberof.Coriimerce, the Business Improvement Association SLO Conflict Resolution, SLO. Parks & Recreation ;. SLO County DSS; SLO County Probation, EOC Childcare Resource Center, and'local businesses and' professionals; 2) Establish a Project ' Implementation.:Team made up of key representatives of the above; 3) Design a training ? program which "would include: preemployment training, basic job skills training, job placement,' , and monitoring and support; 4). Organize; public . and private employers; 5j.,Establish a mentonng - component; and 6) Identify and obtain oii -going funding Geographic Area .and Number of People: to be Served:. ± The proposed planning phase of YES will operate in the city. of San Luis Obispo. Upon successful establishment of the program ii $LO,. the model will'b 'made available to communities throughout the county_: Since the . program is a planning effort; it is expected`that the. number of young people who will benefit initially will be low, between five and fifteen. This number,will.increase. significantly When,'--.-.: the YES reachwfull o' rational..capacity ` in the'fall. ". Maximization of Resources; Minimization. of 'Duplication, - and. Plans for Collaboration.. . The nature of'the proposed planning process is collaborative, involving businesses, schools, and public and private. service providers.'* It is the expectation. that simplybringing all of the players to. the table will produce a synergistic effect, arid will elirninate any duplication•of services.: :. Support -from Other. Corporations /Foundations/Private Businesses: A.largenumber of organizations, businesses, and institutions are already. committed to participating in the YES planning phase.., (See the attached letters:of support.) Principal Sources of Funding: _ The.Mayor.'s Youth Task Force is primarily funded'in the following ways: the reDllTce program is funded through -the San Luis Obispo Prevention Alliance, and staff support (a community organizer) is provided by SLO County Drug and Alcohol Services. Additional funding. for the YES program is expected to come from local': businesses, service clubs, professional organizations, and local government. • `. Amount Requested: $4906:. Utilization, of `Grant 'Monies The.funds.requested of PG &E will be used to paya staff person' i. who.will oversee the."planningprocess, to, provide support materials'and'services, :and.to reimburse -the fiscal agent for indirect costs (See.the attached:program budget:},,.The project, ' . `:".':•: will start as soon as possible, and .will continue for sixaioriths, by'which "time the'YES would be at the operational stage. -- Past. PG &E Funding History:'.: None Grant Management: As,a grass roots agency, the MM is not an established non = profit corporation. [tis presently in negotiations with several groups for.ohe of them to act as the,:'..'..- : It- fiscal agent for this project: It. is ezpected:that one (e.g., PIC, SLO. Chamber'of Commerce, EC; or the BIA) will commit in the very near:future. The fiscal agents tax determination.letter',and • financial. will be provided at that timer. PG &E and - Other _Sponsor ,Recognition: PG&E will receive prominent mention as the charter funder of the YES:. All organizational and ,institutional participants will be made. aware of PG &E's generosity;-as will.youth, parents,.and other community members.'., The breadth of the proposed collaborative insures a significant dispersion of recognition for the. progra s support m ers. -