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2008-08-05 Joint CC CIC MinutesMINUTES OF THE SPECIAL JOINT CITY COUNCIL AND COMMUNITY IMPROVEMENT COMMISSION (CIC) MEETING TUESDAY- -AUGUST 5, 2008- -7:25 P.M. Mayor/Chair Johnson convened the Special Joint Meeting at 10:08 p.m. ROLL CALL – Present: Councilmembers/Commissioners deHaan, Matarrese, Tam, and Mayor/Chair Johnson – 5. Absent: Councilmember/Commissioner Gilmore – 1. MINUTES (08-41 CIC) Minutes of the Special Community Improvement Commission Meeting held on July 15, 2008. Approved. Vice Mayor/Commissioner Tam moved approval of the minutes. Councilmember/Commissioner deHaan seconded the motion, which carried by unanimous voice vote - 4. [Absent: Councilmember/ Commissioner Gilmore – 1.] AGENDA ITEM (08-319 CC/08-42 CIC) Recommendation to approve Affordable Housing Agreement with Warmington Homes for the Grand Marina Project. The Development Services Director gave a presentation. Councilmember/Commissioner Matarrese inquired whether the City has an Affordable Housing Agreement with Warmington, to which the Development Services Director responded in the negative. Councilmember/Commissioner Matarrese inquired whether Warming has committed to building 10 units at Grand Marina. The Development Services Director stated the Agreement is being considered tonight and has to be approved before Warmington can pull building permits. The Development Services Director continued her presentation. Mayor/Chair Johnson stated tonight the Council/Commission is considering an Agreement that would allow a project at Island High as an option; inquired what public input opportunities would exist Special Joint Meeting Alameda City Council and Community Improvement Commission August 5, 2008 1 should the Agreement move forward. The Development Services Director responded Warmington would respond to community input, follow the normal process, and work toward a project that the School Board and Planning Board would be comfortable with; if Warmington does not build on the site, the CIC, working with School District, would go through the same public process; if the Alameda Unified School District (AUSD) and the CIC do the project, there would be less opportunity to construct moderate income units on the site because both the CIC and AUSD money and tax credits support low and very low income, but not moderate units; the Guyton Agreement restricts both AUSD’s housing dollars and most of the CIC’s housing dollars. Mayor/Chair Johnson inquired whether approval of a project is not before the Council/Commission tonight, but that the Agreement, which does not give any entitlements to any particular project, is being considered. The Development Services Director responded in the affirmative. Councilmember/Commissioner deHaan stated the City had an Agreement with Warmington for Veteran’s housing; inquired how many units were constructed. The Development Services Director responded the 39 units at Operation Dignity were part of the Catellus project. Councilmember/Commissioner deHaan inquired how much money Catellus put into the project. The Development Services Director responded Catellus was not obligated to money into the project; stated the project was an obligation of the CIC under the Development Agreement. Councilmember/Commissioner deHaan inquired where the funding came from. The Development Services Director responded the deal was leveraged with Multifamily Housing Program (MHP) funds and tax credits; stated about 20% of the equity contribution came from the CIC; the CIC removed the units and was obligated to replace the units under the law; the entire transaction assigned certain costs to the public; Catellus loaned funds to the CIC. Councilmember/Commissioner deHaan inquired how much Warmington would invest in the project. Special Joint Meeting Alameda City Council and Community Improvement Commission August 5, 2008 2 The Development Services Director responded the amount would depend on the number of units; stated an appraisal was done in the last six months; lump sum lease payments, which total approximately $1 million, would be paid by Warmington; there would be a [funding] gap depending on the number of units. Councilmember/Commissioner deHaan inquired whether the houses that would be constructed would be market rate if the [affordable] houses are moved out of the development, to which the Development Services Director responded in the affirmative. Councilmember/Commissioner deHaan inquired whether the money that the developer would make [off of additional market rate houses] would be a wash with the money that would go into the Island High site. The Development Services Director responded it would depend upon the number of units; stated the more units that are put on the Island High site, the less cost per unit. Councilmember/Commissioner deHaan inquired what percentage set aside would have to be for sale and what percentage would have to be rental units, to which the Development Services Director responded specific percentages of for sale units and rental units are not required. Councilmember/Commissioner Matarrese inquired whether the decision tonight is not how many units or how much units would cost, rather the Council/Commission is simply deciding whether all 10 units would be at the project site, whether the developer could consider other sites for five units and whether nine units would be required if five units are off site. The Development Services Director responded in the affirmative; stated if the units are constructed at the Island High site, there is an outside limit of 36 units. Councilmember/Commissioner Matarrese inquired where the number [36 units] came from. The Development Services Director responded the number uses the Guyton exception to get as many units as possible; stated a Measure A compliant project would be between 16 and 18 units. Councilmember/Commissioner Matarrese stated Warmington needs to have an Affordable Housing Agreement for the Grand Marina project Special Joint Meeting Alameda City Council and Community Improvement Commission August 5, 2008 3 to go forward; inquired whether the Agreement would not have to include language about where the off site units would be placed. The Development Services Director responded the Planning Board acknowledged that if Island High, which was previously identified in the Housing Element, was the off site location, it would be an okay location because it meets other requirements. Councilmember/Commissioner Matarrese inquired whether the nine units could be built at Island High without going up to the maximum number of units, to which the Development Services Director responded in the affirmative. Councilmember/Commissioner Matarrese inquired whether Warmington would simply be concerned with building nine units somewhere other than the Grand Marina site, to which the Development Services Director responded in the affirmative. Councilmember/Commissioner Matarrese inquired whether the City could authorize the Affordable Housing Agreement to either require ten units on site or allow five units off site as long as four additional units would be constructed. The Development Services Director responded said explanation stops short of allowing future credit for additional units; stated if additional units are not going to be constructed, the [Island High] site should be retained by the CIC and AUSD for construction of 16 to 18 units. Councilmember Matarrese stated that he is trying to separate out what happens with the off site units; the developer needs to know whether five or ten units would be on site [Grand Marina] in order to get the project started; the City is requiring nine units if five units are moved off site; questioned why the Agreement could not stop there to get the project going; then, the Island High site or any other site would go through the routine, normal planning process; 36 units is an absurd number for the [Island High] site; the site could carry multiple family units; teachers and School District employees would have first shot at the units; a project should not be predicated on putting as many units as possible on the site, which is not the City’s approach; the City’s approach has always been to develop a quality product, such as Shinsei Gardens and the Breakers; that he would like to cut the Agreement down to what is needed to get the Grand Marina project started; then, the process could work for the Island High site or any site where the units might end up. Special Joint Meeting Alameda City Council and Community Improvement Commission August 5, 2008 4 Mayor/Chair Johnson stated that the normal process would be followed whatever site is selected. The Development Services Director stated the Agreement would have to be amended to give Warmington credit if additional units are constructed. Councilmember/Commissioner Matarrese stated the credit question is within the envelope; the Agreement should address the number of units; where the [off site] units would end up is another matter. Mayor/Chair Johnson stated Councilmember Matarrese is not saying the Agreement should stop at nine units, rather the matter should be left up to the future process; the Developer could raise the issue once a site is selected; the [off site] location is not needed to move the Grand Marina project forward. The Development Services Director stated the Agreement would have to be amended if the Developer came back to get credit for a project over nine units. Mayor/Chair Johnson stated the Agreement would not have to be amended; there could be a separate Agreement to give credit towards a different project. Councilmember/Commissioner deHaan stated the City is going though the Coast Guard housing process which will be no less than 284 houses that could easily be in the affordable range; inquired whether said houses could be included. The Development Services Director responded that she has no idea what said number would be; stated providing accommodations to formerly homeless people is a federal government requirement; it is a whole different product type and is a federal disposition process. The Acting City Manager responded the site is a homeless site, not an affordable housing site under the McKinney Act. Councilmember/Commissioner deHaan inquired whether none of the units could be used [for affordable housing], to which the Acting City Manager responded not for inclusionary needs, but there are other sites that potentially could be used. Councilmember/Commissioner deHaan stated other developers would ask to move units off site if the Agreement is approved; the additional units would land somewhere. Special Joint Meeting Alameda City Council and Community Improvement Commission August 5, 2008 5 The Acting City Manager stated there are other relatively small sites in the Housing Element that could be landing sites. Mayor/Chair Johnson opened the public comment period. Proponents (In favor of staff recommendation): William Schaff, AUSD School Board President; Mark Rowson, Warmington Homes; Doug Davis, AEB Partners; Michael John Torrey, Alameda; Andy McKinley. Opponents (Not in favor of staff recommendation): Markus Roskothen, Alameda; Mary Burson, Alameda (submitted comments); Patricia Paul, Alameda; Janice Miles, Alameda; Brian Kernan, Alameda; Sandra Schuitema, Alameda; Mary Hogan, Alameda; Melanie Wartenberg, Alameda (submitted petition); Kate Smith, Alameda; Malyea Chop, Alameda; Erik Miller, Alameda; Andy Olveir, Alameda; Adam Garfinkle, Alameda; Anne Baer, Alameda; Nancy Clarke, Alameda; Sarah Tbin, Alameda; Kurt Libby, Alameda (submitted comments); Joseph Yon, Alameda (submitted comments); Karen McCloud, Alameda; Taiko Roskothen, Alameda; Billie Banford, Alameda; David Howard, Alameda; Scott Meyerson, Alameda; Amy Parker, Alameda; Nancy Manos, Alameda; Tom Antholzner, Alameda; Donna Layburn, Alameda; Doree Miles, Alameda (submitted letter); Patricia Geraghty, Alameda; Gerry Torres, Alameda; Gerald Yamasaki, Alameda; Nanetee Burdick, Alameda; Christopher Buckley, Alameda (submitted letter); Anna Lee, Alameda; Trish Spencer, Alameda. * * * (08-320 CC/08-43 CIC) Following Gerry Torres’s comments, Councilmember/Commissioner Matarrese moved approval of continuing the meeting past midnight. Councilmember/Commissioner deHaan seconded the motion, which carried by unanimous voice vote – 4. [Absent: Councilmember / Commissioner Gilmore – 1.] * * * There being no further speakers, Mayor/Chair Johnson closed the public comment period. Councilmember/Commissioner deHaan stated the City set a 60% homeownership goal; the recommendation tonight is out of character; the Planning Board and Economic Development Commission (EDC) have always wanted to have a balanced community; that he would support keeping the inclusionary housing within the development. Councilmember/Commissioner Matarrese stated there are two goals: 1) Special Joint Meeting Alameda City Council and Community Improvement Commission August 5, 2008 6 provide affordable housing homeownership opportunities, which would be accomplished by including ten units at the Grand Marina development; 2) allowing the Island High site to be developed into affordable housing for teachers and AUSD employees, which is a worthwhile project that needs to be included in the North of Lincoln Street plan; there needs to be a discussion about the most effective way to provide affordable housing, which might include condominium conversions; that he would like the Island High project to be separate and follow its own process; that he would like to move the Warmington project forward. Councilmember/Commissioner Matarrese moved approval of adopting an Affordable Housing Agreement which includes the ten units on site as inclusionary as was defined in the site plan. Vice Mayor/Commissioner Tam inquired whether the motion is that all affordable and moderate units remain on the [Grand Marina] site, to which Councilmember/Commissioner Matarrese responded in the affirmative. Vice Mayor/Commissioner Tam seconded the motion. Under discussion, Vice Mayor/Commissioner Tam stated one neighborhood’s requirements should not be shifted to another neighborhood; other developers would begin to make the same request if the City started allowing affordable unit to be built off site; State MHP funds are available for rental units; inquired whether the Warmington project could subsidize five rental units on the Grand Marina site without using MHP funds. The Development Services Director responded that she could not unequivocally state that the funds could not be used; stated the parameters to qualify for MHP funds are that there be an on-site manager and that the project meets certain conditions; competitively, the projects have to rank against other projects across the State; nobody has seen success with small projects; other requirements with MHP funds and tax credits are amenities, such as community centers and computers. Vice Mayor/Commissioner Tam inquired whether the Developer could turn units into rentals to meet the low-income requirement even without access to MHP funds. The Development Services Director stated the inclusionary ordinance allows it [construction of rental units]; that she does not know whether or not the developer would manage five units. Special Joint Meeting Alameda City Council and Community Improvement Commission August 5, 2008 7 Councilmember/Commissioner Matarrese stated the City still maintains the goal of increasing homeownership; the School District surplused Island High to create very affordable rental units as a tool for recruiting teachers and employees; there is opportunity to do a lot of great things, such as meeting green standards and creating a transit village; dropping the highest number of units on the community, rather than talking about what should be there, is not in the context of what the School District and City have talked about for years. Mayor/Chair Johnson stated that she agrees that the Council needs to visit the issue of the best way to provide affordable housing separately; the Economic Development Commission should review the issue and make recommendations to Council. On the call for the question, the motion carried by unanimous voice vote - 4. [Absent: Councilmember/Commissioner Gilmore – 1.] ADJOURNMENT There being no further business, Mayor/Chair Johnson adjourned the Special Joint Meeting at 12:20 a.m. Respectfully submitted, Lara Weisiger City Clerk The agenda for this meeting was posted in accordance with the Brown Act. Special Joint Meeting Alameda City Council and Community Improvement Commission August 5, 2008 8