PREPARED BY: Charles Ching DATE OF MEETING: 09/04/18
SUBJECT:
TITLE
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN PABLO APPROVING AND AUTHORIZING EXECUTION OF A DISPOSITION AND DEVELOPMENT AGREEMENT WITH CITY VENTURES HOMEBUILDING, LLC, FOR THE SALE AND DEVELOPMENT OF BLOCK E (2812 CHATTLETON LANE IN THE VICINITY OF CHURCH LANE AND SAN PABLO AVENUE) IN THE MIXED-USE CENTER SOUTH AREA (FORMERLY KNOWN AS CIRCLE S)
Label
CITY MANAGER RECOMMENDATION
Recommendation
Adopt Resolution
Body
Compliance statements
The Circle S Project Development (PHASE II) New Mixed-Use Development is an adopted policy item under the FY 2018-21 City Council Priority Workplan, effective November 1, 2017.
CEQA Compliance Statement
Michael Baker International reviewed the proposed Project on May 25, 2018, and determined that it is consistent with the San Pablo General Plan and the San Pablo Avenue Specific Plan and the environmental documents prepared for those Plans and that no additional environmental review is required for the proposed Project. A copy of the analysis by Michael Baker International is attached.
BACKGROUND
City Ventures Homebuilding, LLC (the “Developer”) is proposing to build twenty-six (26) townhomes, associated parking, and two (2) public activity areas on the Site. The public activity areas will consist of an exercise area and a playground with direct access to the nearby creek trail.
The Site was designated a housing asset by action of the San Pablo Local Successor Agency on July 10, 2013, which was approved by the San Pablo Oversight Board on July 12, 2013, and by the California Department of Finance on August 14, 2013. It is currently owned by the City as the housing successor to the former Redevelopment Agency of the City of San Pablo. The net proceeds from the sale of the Site will be deposited into the City’s Low and Moderate Income Housing Asset Fund (the “LMIHAF”) to be used for affordable housing programs and projects within the City of San Pablo.
The City and the Developer have negotiated the substantive business terms of a Disposition and Development Agreement (the “DDA”) providing for the sale and development of the Site. The purchase price for the Site is $550,000 and is based on an appraisal obtained on April 9, 2018, from Smith & Associates. As part of the requirements under the proposed DDA, the Developer is required to enter into an Owner Occupancy Covenant with the initial buyers of the townhomes and require that the townhomes be owner-occupied for a period of one year. The proposed DDA is attached to this staff report as Attachment No. 1.
In addition, the Developer shall ensure that contractors constructing the project employ at least one new apprentice to perform at least 400 total construction work hours, in accordance with the City’s Local Economic Opportunity Policy. The Developer is also required to meet with the San Pablo Economic Development Corporation (“EDC”) to contact local contractors to bid on the work. Prior to close of escrow, the Developer will deposit $20,000 as security for the performance of these obligations. The proposed DDA calls for the Developer to construct the Project on the Site within a certain time frame and according to a specific scope of development. The schedule currently estimates that close of escrow for the Site would occur as soon as possible but no later than September of 2019 and that construction would commence within 90 days and be completed within 24 months, that is, no later than November 2021. A preliminary site plan for the Site is attached to the proposed DDA (as Exhibit A to the Scope of Development, Attachment No. 4).
Pursuant to the proposed DDA, the Developer must obtain all necessary approvals to develop the Project prior to close of escrow for the Site.
The DDA contains provisions for the termination of the DDA by the City prior to the conveyance of title to the Site if the Developer is in default under the DDA or has not performed certain actions required by the DDA. After conveyance of the Site to the Developer, if development of the Project stalls due to the Developer’s default, the DDA provides the City with an option to repurchase the Site.
Government Code Section 65402 provides that if a General Plan has been adopted, no real property shall be disposed of if the General Plan applies until the location, purpose and extent of such disposition has been submitted to and reported upon by the Planning Commission as to conformity with the General Plan.
On April 24, 2018, the San Pablo Planning Commission adopted Resolution 18-06, finding that the proposed sale of the Site was consistent with General Plan and Housing Element policies, consistent with goals and implementing policies of the San Pablo Avenue Specific Plan, and consistent, with insignificant exceptions, with the Mixed Use Center South Regulating Plan.
FISCAL IMPACT
The DDA provides for the sale of the Site for $550,000. The sale proceeds are to be deposited into the City’s Low and Moderate Income Housing Asset Funds.