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N40 Phase 1 - Staff Report Exh.19 Exhibit C: Diagram Demonstrating Height of Three-Story Buildings above Finished Grade @ North 40 – Proposed BMP Plan The Town’s Below Market Price (BMP) Program promotes the development of affordable housing units by providing standards and guidelines that require the creation of a certain number of affordable units development project. For the proposed North 40 Development application, the developers have proposed the following development program: • Ownership townhomes/garden cluster/courtyard condominiums.: 253 (SummerHill) • Ownership garden cluster: 7 (Hirschman) • Live/Work Condominiums: 2 (Grosvenor) • Rental Apartments: 8 (Grosvenor) • Affordable rental apartments for seniors: 50 (Eden) Due to qualifying for the California State Density Bonus, the above numbers include the baseline number of units (237) plus the additional 35% density bonus units (82) for a total proposed program of 320 residential units. The Town’s BMP program requirements are calculated using the baseline count (237). The affordable rental senior apartments are being proposed to satisfy the Town’s BMP program, and will offer amenity-rich, high-quality apartment homes for seniors making up to 50% of the Area Median Income. The development team feels that our proposal meets the intent of the Town’s BMP program, and helps achieve the following goal from the Town’s 2003 Housing Element: To improve the choice of housing opportunities for senior citizens, families and singles and for all income groups through a variety of housing types and sizes, including a mixture of ownership and rental housing. However, the affordable product as proposed does not meet the exact requirements of the BMP program as written. The following details what is required under the BMP, what the team is proposing, what waivers under the BMP program are required and a justification of this approach. • Requirements of the BMP • Number of Units Per the Town’s BMP, developments of 101 units or more are required to provide BMP units equal to twenty percent of the number of market rate units, with smaller projects requiring gradually fewer units based on a formula. The number of BMP units required under the Program would be slightly different depending on whether the Town chooses to define the combined application as one project or three: 1) Three separate projects BMP /du required Grosvenor 10 10% 1 SummerHill (baseline) 220 20% 36.6 (37) Hirschman 7 10% 1 TOTAL 237 36.8 (37) BMP units 39 2) One project Grosvenor + SummerHill + Hirschman 237 20% 39.4 (40) TOTAL 237 39.4 (40) BMP units 40 The development team views this proposal as a coordinated approach to create a truly integrated and holistic neighborhood. Therefore we are assuming that for the purposes of BMP calculation, the “project” includes the Phase I North 40 development as a whole. As shown above, this approach also provides the benefit of one additional BMP unit above the number that would be required if the units were calculated separately for the Grosvenor, Hirschman, and SummerHill components. • Affordability of BMP Units In addition to the number of units, the BMP Program further requires that the units must be affordable to both Median Income households (those earning between 80% and 100% of the Area Median Income (AMI) and Low Income households (those earning between 50% and 80% AMI). Half of the BMP units are required to be targeted to Low Income households and the other half Median Income households. Given these requirements, the 40 proposed BMP units would roughly be distributed as follows: • BMP affordability as Required Very Low Income Low Income Median Income Total Unit Distribution 0 20 20 40 However, under the model that the development team is proposing, where Eden’s development will be able to leverage additional financing for a stand-alone affordable housing building, the distribution of BMP affordab36ility will be as follows: • BMP affordability as Proposed Very Low Income Low Income Median Income Moderate Income Total Unit Distribution 49 0 0 1 50 • What is Being Proposed The development team is proposing a 50 unit project consisting of forty-nine (49) one- bedroom units for very low income seniors and one (1) two-bedroom managers unit. While the final targeted income targeting will depend on the financing secured, the unit mix of a 9% tax credit execution would be roughly as follows: Extremely Low Income Units @ 30% AMI 10 Very Low Income Units @ 45% AMI 9 Very Low Income Units @ 50% AMI 30 Moderate Income Unit @ 80% AMI (Manager’s Unit) 1 The affordable housing program will be most successful if fifty units are built, due to economies of scale and more successful management of a building of this size. Because Phase I is not proposing to construct all of the 270 baseline units but is proposing this surplus of BMP units, we request that these additional 10 units count towards any future residential development’s BMP requirements on the remainder of the North 40 properties. The affordable component will help meet the needs of low income seniors in Los Gatos with safe, attractive, and affordable homes and on-site services that will help these individuals thrive. The project will include high quality amenities available in all Eden developments including a community room, a computer center and library, and landscaped courtyards and furnished lobbies for casual social interaction. The architecture and interiors will be designed in such a way to provide a stimulating, spacious, and inviting environment for the seniors as they age in place. Eden’s service provider and affiliate, Eden Housing Resident Services, Inc., will offer resident activities and programs specifically designed for seniors. • Waivers Required Under the Current BMP Program The Development team is requesting waivers on the following specific requirements: • Type of Units, Rental vs For Sale: The Program requires that the “BMP units within a project of owner-occupied units shall also be designated as units for purchase.” In this case, the development team is proposing rental housing to meet the requirements of the market-rate for sale product. • Location of units: The Program requires that the “BMP units shall be dispersed throughout the development, to the extent feasible; in all buildings, on each floor, and in each project phase.” In this case, the development team is proposing a singular affordable senior housing component which is located on the air rights above the Market Hall element. This centralized location for these units, as discussed below, is key to the financing, ability to serve Very Low Income seniors and ability to provide on-site supportive services. • Size of units: The Program requires that the “size and design of BMP dwelling units shall be reasonably consistent with the market rate units in the project.” • Building Exterior: The Program requires that the “external appearance of BMP units should be indiscernible to that of the market rate units in the project.” The Eden affordable component will be a part of the Market Hall and will be high quality architecture consistent with the rest of the development. Eden and Grosvenor are using the same architect and contractor to design and build this building. The affordable housing will not be distinguishable as affordable housing merely by architectural treatments, however as part of a separate building it will have its own style in order to create visual interest and texture to the neighborhood. • Interior Finishes: The Program requires that the “ internal finish of BMP units should be identical to that of the market rate units in the project, except that the developer may request Town approval of substitutions for luxury interior finishes, appliances, or fixtures, if such substitutions do not violate any Town code requirement.” Eden will have its own interior finish schedule based on its preferred specifications. These materials and appliances will meet all local, state and funding requirements. • Project Facilities: The Program requires that “all project facilities and amenities, including parking, must be available on the same basis to the BMP units as to the market rate units in the project, to the extent feasible.” As proposed, the affordable component will have its own facilities and amenities – many of which will be above and beyond what is provided in the market-rate components. For example, the affordable senior community will include the following amenities: a community room, a computer center and a library or exercise room. However, the parking ratio assumed for the senior affordable is lower (.5 per unit) based on data which shows that low income seniors own fewer cars. • Justification for Waivers Requested • Deeper affordability. Proceeding with the development as proposed will allow the development team to provide up to 49 units targeted to Very Low Income seniors, and will help the Town show production of these units in the Regional Housing Needs Allocation (RHNA) process. As shown in the Town’s recent history of affordable housing development, these Very Low Income units are the hardest to produce. The Eden affordable senior component will provide 49 units targeted to Very Low Income and Extremely Low Income Seniors, along with one Moderate Income managers unit. • Amenity-rich and service-enhanced housing for Low Income Seniors In addition to making deeper affordability financially feasible, providing all of the affordable units in one central building allows Eden to provide supportive services on-site. These services provide wrap-around services that help lower income residents thrive – and are not available in a typical disbursed BMP implementation. For this development, Eden Housing Resident Services, Inc. (EHRSI) will provide resident services programming ranging from information and referrals via regularly updated resident services guides to comprehensive programming. EHRSI’s Resident Services staff is available to offer important information and referral services and to develop key partnerships in our communities. We work one-on-one with residents, coordinate and facilitate group educational programming, develop community building activities and bring in outside speakers to present on topics of relevance and interest to our residents. Eden has extensive experience working with a senior population. The primary goal of our senior resident services is to allow our seniors to ‘age in place’ and live independently in a dignified, healthy and productive way. To meet this goal, we provide a range of programming tailored to each individual resident. The overall intention of services programming for our senior and special needs residents is to: • Reduce isolation by providing on-site programs and encouraging resident- led programs • Provide residents with access to resources via information and referral • Provide programming designed to enhance the quality of life of our residents • Address health and wellness issues faced by our diverse communities including depression, physical fitness, assistive technology, nutrition/diet and personal safety • Monitor the ability of our residents to continue to live independently and safely in our housing community • Build strong communities by facilitating community events, collaborating with resident associations and encouraging volunteerism in the community (internally/externally) As a testament to our ability to provide housing and services allowing our residents to age in place successfully, nearly one quarter of our residents in senior developments are over the age of 80 – with three residents over 100. • High quality design Eden is recognized in the industry for its creative development approach that includes collaborating with local governments and development partners to create well-designed properties that meet the needs of the residents and tailoring projects to suit the locale. In the recent past, Eden has completed entitlements for projects in Palo Alto, Lafayette, Dublin, Novato, Orinda, and Fremont -- all of which required excellent design as well as the development and execution of thoughtful and comprehensive community outreach strategies. In addition, Eden places a high value on design through the work of talented designers, builders and other professionals and is committed to crafting high- quality developments that give careful attention to the needs of residents and the surrounding neighborhood. Indeed, Eden has won more than 60 awards for its work, including the recent recognition of Foss Creek Court in Healdsburg, which in 2011 has received the prestigious national Charles L. Edson Award for Tax Credit Excellence, a Gold Nugget Award of Merit from the Pacific Coast Builders’ Conference, and won the Affordable Housing Finance Magazine Readers’ Choice Award for the best Rural project in the country. Eden will bring this same commitment to excellence, along with the rest of the development team to deliver a high-quality, vibrant neighborhood that offers a variety of housing types and sizes for a range of incomes – all of which will be places that people are excited and proud to call home.