Loading...
Staff Report PREPARED BY: ARN ANDREWS Assistant Town Manager Reviewed by: Town Manager, Town Attorney, Finance Director, and Community Development Director 110 E. Main Street Los Gatos, CA 95030 ● 408-354-6832 www.losgatosca.gov TOWN OF LOS GATOS TOWN COUNCIL REPORT MEETING DATE: 5/1/2018 ITEM NO: 13 DATE: APRIL 26, 2018 TO: MAYOR AND TOWN COUNCIL FROM: LAUREL PREVETTI, TOWN MANAGER SUBJECT: REVIEW SUPPLEMENTAL INFORMATION FROM SUPPORT TEACHER HOUSING AND HABIT FOR HUMANITY FOR BELOW MARKET PRICE (BMP) HOUSING AT 20 DITTOS LANE AND DIRECT THE TOWN MANAGER TO ENTER INTO AN EXCLUSIVE NEGOTIATING AGREEMENT (ENA) WITH ONE OF THE PARTIES RECOMMENDATION: Staff recommends that the Town Council review supplemental information from Support Teacher Housing and Habitat for Humanity for Below Market Price (BMP) housing at 20 Dittos Lane and direct the Town Manager to enter into an Exclusive Negotiating Agreement (ENA) with one of the parties. BACKGROUND: On September 19, 2017, the Town Council provided guidance regarding the disposition of 20 Dittos Lane. The Town Council confirmed that the property should be utilized for BMP housing in keeping with the original intent of the property acquisition. In addition, the Council opined that the preferred goals for the property would entail a maximum of four units, target low and moderate affordability income ranges, and an attempt to preserve the historic and environmental nature of the site. Per the Council’s direction, interested parties were encouraged to submit proposals reflective of the aforementioned goals by October 22, 2017. Staff received five proposals at the conclusion of the proposal period. PAGE 2 OF 5 SUBJECT: BELOW MARKET PRICE HOUSING AT 20 DITTOS LANE DATE: APRIL 26, 2018 N:/MGR/Confidential & Closed Session/TC Closed Session/11-14-17TC/Closed Session Draft Properties Update.doc 4/26/2018 12:10 PM BACKGROUND (Continued): On February 6, 2018, the Town Council reviewed the elements of the five proposals and discussed the unique nature of the property and the challenges associated with each proposal. At the conclusion of Council’s deliberations, it selected proposals by Habitat for Humanity and Support Teacher Housing to continue in the evaluation process. The Habitat for Humanity proposal was based on accessing the property from College Avenue and constructing a minimum of 12 units within two, two story structures. The Support Teacher Housing proposal envisioned two homes and two accessory dwelling units with access from the current Dittos Lane. Council directed staff to engage with both parties to understand how each would address the challenges and concerns that the Council identified during deliberations. DISCUSSION: As directed, staff has been engaged with both Habitat for Humanity and Support Teacher Housing. Provided below is a summary of both parties responses (in bold) to the identified challenges (in italics) and additional supplemental material. Support Teacher Housing The initial architectural rendering provided by the applicant illustrated that the 3-bedroom homes were designed for communal living with each bedroom housing non -related individuals. The Town’s BMP program would look at all three individuals’ incomes in total to determine eligibility as a household for an affordable unit. Under the Town’s BMP program, the initial proposal would not have met the BMP guidelines. Response: On April 4, 2018, staff received the revised architectural drawings in Attachment 1 from Chapman Design Studio. While household configuration will ultimately determine compliance with the Town’s BMP program, the designs are consistent with other BMP properties. The proposal envisions ingress/egress from Dittos Lane. In discussions with the proposer, staff identified at least three areas of easements which would require resolution from two different property owners. Response: On March 2, 2018, staff received the letter in Attachment 2 from Gregory Howell indicating a willingness to grant Support Teacher Housing an easement. In addition , on March 15, 2018, staff received the letter in Attachment 3 from Ryan Maas indicating a willingness to grant Support Teacher Housing an easement. PAGE 3 OF 5 SUBJECT: BELOW MARKET PRICE HOUSING AT 20 DITTOS LANE DATE: APRIL 26, 2018 N:/MGR/Confidential & Closed Session/TC Closed Session/11-14-17TC/Closed Session Draft Properties Update.doc 4/26/2018 12:10 PM DISCUSSION (Continued): Access from Dittos Lane and the site plan layout would require compliance with County Fire requirements. Response: On March 28, 2018, staff received the letter in Attachment 4 from Chapman Design Studio indicating that the firm has discussed the proposal with representatives of County Fire and based on those discussions, the firm believes the proposed project will comply. The proposer’s intention is to make the units provided available only to teachers. Staff identified that pursuing a housing program for the exclusive use of teachers would likely require the project to include a School District as a partner in order to take advantage of the Teachers Housing Act. Response: On March 7, 2018, staff received the letter in Attachment 5 from the Los Gatos – Saratoga Union High School District indicating an interest in exploring the Support Teacher Housing proposal. In addition, on March 9, 2018, staff received the letter in Attachmen t 6 from the Los Gatos Union School District indicating an interest in exploring the Support Teacher Housing proposal. Habitat for Humanity The proposal envisions accessing the property from College Avenue and engineering a new point of ingress/egress down into the site. Habitat believes that their engineering analysis of the site makes access from College Avenue feasible. In discussions with the proposer, staff identified community acceptance as an important element. Response: On February 21, 2018, staff received the memorandum in Attachment 7 announcing a community meeting for College Avenue residents hosted by Habitat for Humanity. Staff also attended the meeting. On March 29, 2018, staff received the updated proposal in Attachment 8 from Habitat for Humanity. As the proposal indicates, Habitat for Humanity is no longer inclined to pursue access from College Avenue and instead is considering a Dittos Lane access. The updated proposal is for development of a portion of the Dittos property with the remaining portion retained by the Town. Similar to their proposal of April 17, 2017, this proposal envisions two to four 3- and 4- bedroom homes. PAGE 4 OF 5 SUBJECT: BELOW MARKET PRICE HOUSING AT 20 DITTOS LANE DATE: APRIL 26, 2018 N:/MGR/Confidential & Closed Session/TC Closed Session/11-14-17TC/Closed Session Draft Properties Update.doc 4/26/2018 12:10 PM DISCUSSION (Continued): On April 24, 2018, staff received an additional updated proposal in Attachment 9 from Habitat for Humanity. The updated proposal states that Habitat for Humanity contacted the adjacent property owners seeking agreements for access to 20 Dittos Lane. The proposal states the owners expressed a willingness to provide agreements but none have been received to date. The proposal envisions ingress/egress from Dittos Lane. Staff met with officials from Habitat for Humanity on April 11, 2018 to share information specific to challenges associated with ingress/egress from Dittos Lane. Specifically, staff identified at least three areas of easements which would require resolution from two different property owners. Response: No response received to date. Access from Dittos Lane and the site plan layout would require compliance with County Fire requirements. Response: No response received to date. CONCLUSION: Based on the staff report, Council deliberations, and public and proposer input, the Council should determine which proposer to direct the Town Manager to enter into an ENA for the development of 20 Dittos Lane. The assignment of an ENA does not remove the proposer from the Town’s normal planning and development application requirements and process. Alternatively, if Council determines that the unique nature of the Dittos property does not effectively accomplish the Town’s BMP goals then the Council can consider selling the property for market rate development. As noted in previous staff reports, the original Redevelopment Agency purchasing documents did not require a minimum number of affordable housing units be built on the property nor is there any deed restrictions associated with the property. If the Council determines to monetize the property for market rate development, the proceeds must be placed in to the Town’s BMP/Affordable Housing Fund. COORDINATION: This report was coordinated with the Town Attorney’s Office and Director of Community Development. PAGE 5 OF 5 SUBJECT: BELOW MARKET PRICE HOUSING AT 20 DITTOS LANE DATE: APRIL 26, 2018 N:/MGR/Confidential & Closed Session/TC Closed Session/11-14-17TC/Closed Session Draft Properties Update.doc 4/26/2018 12:10 PM FISCAL IMPACT: No fiscal impact at this time. ENVIRONMENTAL ASSESSMENT: This is not a project defined under CEQA, and no further action is required. Attachments: 1. Support Teacher Housing revised architectural drawings 2. Support Teacher Housing Howell Easement Letter 3. Support Teacher Housing Maas Easement Letter 4. Support Teacher Housing Santa Clara County Fire Engagement Letter 5. Support Teacher Housing Los Gatos-Saratoga Union School District Engagement Letter 6. Support Teacher Housing Los Gatos-Saratoga Union High School District Engagement Letter 7. Habitat for Humanity College Avenue Residents Meeting 8. Habitat for Humanity Updated Proposal Letter 9. Habitat for Humanity Updated Proposal Letter 2