PLANNING AND HOUSING COMMISSION
STAFF REPORT
DATE: 06/10/2024
TO: Honorable Chair and Commissioners
FROM: Community Services Department
APPLICATION REQUEST:
Title
Review of the sale of four acres owned by the Corona Housing Authority for the 2nd Street Multifamily Affordable Housing Project located at the southwest and southeast corners of Buena Vista Avenue and Second Street and a General Plan Consistency Determination (Portion of APN 118-270-055 and APNs 118-270-053, 118-302-030) (Applicant: Community Services Department)
End
RECOMMENDED ACTION:
Recommended action
That the Planning and Housing Commission:
1. Recommend to the Corona Housing Authority the approval of the sale of four acres for the development of an affordable housing project consisting of 115 multifamily units subject to the approval of development applications.
2. Adopt Resolution No. 2637 determining that the sale of four acres located at the southwest and southeast corners of Buena Vista Avenue and Second Street is in conformance with the City’s General Plan (Portion of APN 118-270-055, and APNs 118-270-053, 118-302-030).
Body
ANALYSIS
BACKGROUND
Section 2.58.070 of the Corona Municipal Code states the Housing Commission of the City of Corona shall serve in an advisory capacity to the Corona Housing Authority and shall review and make recommendations on matters to come before the Housing Authority. This includes the sale of property owned by the Corona Housing Authority for the development of affordable housing.
Property Owned by the Corona Housing Authority
On April 3, 2019, the Corona Housing Authority Board (Authority) authorized the purchase of three parcels abutting the newly expanded 91 FWY, located along Second Street and South Buena Vista Avenue. Riverside County Transportation Commission (RCTC) acquired these properties in furtherance of the 91 FWY Expansion Project and, at the culmination of the project, per the Surplus Land Act, before opening the sale of land to the public, RCTC must offer properties to agencies and entities in furtherance of the priority uses under the law. One of the priorities is the development of affordable housing.
The Authority purchased the properties for $2 million to partner with an affordable housing developer on the future construction and long-term management of affordable housing units. The lots purchased are 4.82 acres comprised of two lots, Assessor Parcels 118-270-055 & -053 (Large Lot), located at the southwest corner of Second/Buena Vista, and a noncontiguous 0.20-acre lot (Small Lot), Assessor Parcel 118-302-030, located at the southeast corner of Second/Buena Vista.
City’s Request for Qualifications
The City Council directed staff to conduct a Request for Qualifications and Proposal for an affordable housing development. Concurrently, the City was also developing its homeless strategies; therefore, staff included preferences in its RFQ/P for homeless and homeless prevention housing to maximize the use of the Large Lot. On October 17, 2020, a 60-day RFQ/P process was opened. Six (6) proposals were received and reviewed by a 5-member panel made up of City staff in the Housing Division, the City’s Homeless Coordinator, the Deputy City Attorney, and an independent financial consultant who specializes in affordable housing financing. Two (2) developers were invited to an interview: C&C Development, Orange Housing & Mercy Housing, and Related California. The panel recommended the proposal by C&C Development, Orange Housing & Mercy Housing. On June 16, 2021, the Authority directed staff to proceed with their recommendation.
Sale of Corona Housing Authority Property for an Affordable Housing Project
C&C Development, Orange Housing & Mercy Housing (Developer) proposal contained two developments: 1) permanent supportive housing, and 2) multifamily development. The developments were separated to maximize available financial subsidies and opportunities. As a result, the Developer’s projects are being submitted separately for financing purposes.
This staff report focuses on the multifamily housing project.
Under this project proposal, the Developer requests to build a 115-unit multifamily housing development on approximately 3.82 acres of land. This Large Lot is currently approximately 4.82 acres in size and will be reduced, through lot line adjustment, to 3.82 acres for the multifamily project and a 1-acre lot for the Permanent Supportive Housing (PSH) Project. The multifamily project has an additional noncontiguous 0.20-acre lot referred to as the Small Lot, which will be designed as additional outdoor open space.
Project Description:
The site is well positioned, located at the corner of South Buena Vista and Second Street, within walking distance to a commercial center with a grocery store, public transit, community-serving retail, Corona City Hall, Historic Civic Center, and the Corona-Norco Adult Education Center. The project consists of four 3-story residential buildings, with 6 studios, 18 one-bedrooms, 46 two-bedrooms, and 45 three-bedroom units. Large family units were provided to serve the needs of Corona families, assist in the financing structure and to achieve the City’s goal of serving homeless families. The project includes a 20-unit preference for families that are currently homeless or at risk of homelessness.
The buildings are oriented towards Second Street and Buena Vista Avenue, which provides for consistent massing and street presence across the entire site. Three of the buildings are situated around a central courtyard, which includes open space and a pool. Parking has been placed along the southern boundary of the property, providing a buffer between the residential units and the Corona-Norco School District corporation yard.
In addition to large family-sized units, amenities will include energy-efficient appliances and HVAC systems to decrease residents’ utility costs, the use of low VOC and other sustainable building products to improve residents’ indoor environmental air quality, recessed lighting, durable plank vinyl flooring, large windows for natural lighting, and shaded balconies.
Site amenities include an on-site manager with an on-site leasing office, a tot lot, a BBQ pavilion, a pool, drought-tolerant landscaping, and a multi-use community room with a kitchen. The Small Lot will be designed to provide additional open space for multiple outdoor recreational uses with landscape designs that include native vegetation and historical touches through the incorporation of citrus trees.
Social Services & Programs:
Amenities and social services are critical to affordable housing communities. Special attention is focused on these two elements to create the quality-of-life environment needed in denser developments. Social programming provides essential services, support, and access to the broad population that resides in these communities. The amenities and social services have been designed to complement what is currently provided at Citrus Circle, which is also owned by the Developer, to avoid duplicative efforts.
The Developer will provide social services in partnership with the Corona Norco YMCA (YMCA). The YMCA currently provides social services at Citrus Circle that focus on a younger demographic and include after-school programs, weekly karate classes, family fun nights, and English as a Second Language (ESL) courses for adults. To build upon existing programs and expand services to wider demographics, social services will focus on teens, young adults, middle-aged, and elderly people. Within the community space, the YMCA will create an innovation space where teens and young adults can use technology to learn and play. There will be a dedicated space for the use of technology, including online technology instructional classes, online interactive learning opportunities, and guided eSports learning and competitions to engage and bring teens and young adults together. To engage persons of all ages, the YMCA will provide healthy lifestyle programs such as community group exercise classes (Zumba, yoga, Pilates, karate), adult education classes, Blood Pressure Monitoring Program, and volunteerism programs. Lastly, the YMCA will offer low-impact groups with exercise classes, technology classes, and social hours to engage senior residents. As the community and its needs change, the YMCA will assess and adjust its programs. Residents of both communities will be able to access the site amenities and social services.
Affordability Term:
Another critical component in the selection of the Developer was the affordability term. The Developer agreed to maintain the legally required 55-year affordability term in perpetuity.
Affordability Levels:
Income eligibility will be based on the affordability levels of 30% (extremely low), 50% (very low), and 80% (low) of the Median Family Income (MFI), as indicated in the tables below. The rates shown are based on the 2024 Income Limits published by the California Department of Housing and Community Development, Division of Housing Policy Development, on May 9, 2024.
2024 Household income
|
Household #: |
1 |
2 |
3 |
4 |
5 |
6 |
7 |
8 |
|
30% Extremely Low |
$21550 |
$24600 |
$27700 |
$31200 |
$36580 |
$41960 |
$47340 |
$52720 |
|
50% Very Low |
$35900 |
$41000 |
$46100 |
$51250 |
$55350 |
$59450 |
$63550 |
$67650 |
|
80% Low |
$57400 |
$65600 |
$73800 |
$82000 |
$88600 |
$95150 |
$101650 |
$108250 |
The Developer will apply for different tax credits set aside with the goal of obtaining funding that will allow for the deepest rent levels possible at 30%, 50%, and 60%, with caps up to 70%, as indicated below.
2024 Rents
|
30% |
|
Studio |
$512 |
|
1-Bedroom |
$548 |
|
2-Bedroom |
$658 |
|
3-Bedroom |
$761 |
|
50% |
|
Studio |
$853 |
|
1-Bedroom |
$914 |
|
2-Bedroom |
$1097 |
|
3-Bedroom |
$1268 |
|
60% |
|
Studio |
$1024 |
|
1-Bedroom |
$1097 |
|
2-Bedroom |
$1316 |
|
3-Bedroom |
$1521 |
|
70% |
|
Studio |
$1194 |
|
1-Bedroom |
$1280 |
|
2-Bedroom |
$1536 |
|
3-Bedroom |
$1775 |
The tables below further outline the disbursement of units by bedroom size in each qualifying affordability level.
Affordability Spread:
|
30% MFI |
|
Studio (601 sq. ft.) |
1 unit |
|
1-Bedroom (764 sq. ft.) |
1 unit |
|
2-Bedroom (939 sq. ft.) |
5 units |
|
3-Bedroom (1115 sq. ft.) |
5 units |
|
50% MFI |
|
Studio |
1 unit |
|
1-Bedroom |
1 unit |
|
2-Bedroom |
5 units |
|
3-Bedroom |
5 units |
|
60% MFI |
|
Studio |
3 units |
|
1-Bedroom |
14 units |
|
2-Bedroom |
31 units |
|
3-Bedroom |
29 units |
|
70% MFI |
|
Studio |
1 unit |
|
1-Bedroom |
2 units |
|
2-Bedroom |
5 units |
|
3-Bedroom |
5 units |
One 3-bedroom unit will be set aside in accordance with regulations to maintain an onsite manager.
Project Financials:
The total cost for this project is currently estimated at $59,391,447. To fund this project, the Developer is seeking funding from the following sources: 4% private equity through the California Tax Credit Allocation Committee process, local housing funds, HUD grants from the City’s CDBG and HOME-ARP allocations, and deferred local Development Impact Fees. The total construction per-unit cost is $516,447. Noteworthy is the per-unit cost to the Authority and City. Based on actual cash contribution, our per-unit cost is $87,563 (this assumes all cash contributions, including the total cost to purchase the land). This investment will yield 115 affordable units in perpetuity.
The following is a breakdown of the Authority and City project loans that will be repaid within a 55-year amortized period.
1. Authority Loan Amounts:
a. Land: TBD based on Appraised Value -
b. Cash: $7,535,280
2. City Loan Amounts:
a. Land: TBD based on Appraised Value -
b. Cash: $529,875 (HOME-ARP)
c. DIF: TBD
The total purchase price of the Large and Small Lots was $2,004,650. The City Council allocated $600,000 of its Community Development Block Grant (CDBG) towards the purchase price. The remainder of the purchase price, $1,404,650, was paid from the Housing Fund Balance. The contribution breakdown equals to 30% City and 70% Housing Successor. Therefore, when the land loan is paid, at a reappraised amount, 30% of the value will be paid to the City and deposited into the CDBG Fund and reprogrammed for CDBG-eligible activities and 70% will be deposited into the Housing Fund for the Authority.
Future Development Applications to be reviewed by the Planning and Housing Commission
The entitlement for the project will involve the review of the following development applications, which are anticipated to be reviewed by the Planning and Housing Commission on July 8, 2024.
PP2023-0010: Precise plan to review the site plan and other aspects of the project for the development of 115 affordable multifamily housing units on approximately four acres.
AHDB2023-0002: Affordable Housing Density Bonus Agreement to support the development of 115 affordable multifamily housing units on approximately four acres.
General Plan Consistency Determination
The Authority and City seek a General Plan Consistency Determination for approximately 4-acre property associated with this Family project, located on a portion of APN 118-270-055 & -053 and 118-302-030. A site map of the property is attached as Exhibit 2, and a project rendering is attached as Exhibit 3. The property is zoned Mobile Home Park and Multiple Family Residential and undeveloped. It is surrounded by the 91 FWY to the north, a commercial center to the west, an affordable housing development to the east, and a Corona Norco School District facility to the south.
California Government Code Section 65402 requires that when a local agency plans to acquire, dispose of, or vacate real property or easements for public purposes, the Planning Agency of the city in which the property is located must first issue a report addressing whether the activity conforms with the General Plan.
The Authority’s plan to dispose of the Property is in conformance with the following General Plan Policies:
|
General Plan Policy |
Policy Reason |
|
Policy LU-4.1, Accommodate future growth and development in accordance with figure LU-1 of the Land Use Plan. |
Following the General Plan land use designation, the Property, a portion of APN 118-270-055 & -053 and 118-302-030, located at the southeast and southwest intersections of Second Street and South Buena Vista Avenue, is currently designated as High-Density Residential. |
|
Policy LU-3.3, Allows flexibility in the defined land use types, densities, and intensities to account for changes in housing needs and characteristics. |
The Property was purchased under the State’s Surplus Land Act to construct new affordable housing units in furtherance of the City’s Homelessness Strategic Plan and in conformity with the surrounding land uses to the east, which includes a regulated affordable housing development. |
|
Policy H-1.1, Supports public and private sector nonprofit and for-profit organizations in their efforts to construct, acquire, and improve housing to provide access to affordable housing to lower-and moderate-income households. |
This Property will be developed in partnership with a private sector non-profit entity to provide affordable housing to extremely low-income, chronically homeless person(s), following the City’s General Plan and Homelessness Strategic Plan. |
Development plans, environmental reviews, project contracts, and loan documents are underway in partnership with the Developer. By August 2024, all entitlement and project activities are anticipated to be completed and ready for the Authority and City Council to review.
Staff requests that the Planning and Housing Commission support this proposed affordable housing development of 115 multifamily units, recommend approval to the Authority and City Council, and find that the proposed sale of approximately 4 acres of property, which is a portion of APN 118-270-055 & -053 and 118-302-030, conforms with the City’s General Plan.
ENVIRONMENTAL ANALYSIS
The General Plan consistency determination is not a project under the California Environmental Quality Act and, therefore, does not require environmental review.
FISCAL IMPACT
There is no fiscal impact associated with this action.
PUBLIC NOTICE AND COMMENTS
California Government Code Section 65401 does not require public notification for a General Plan Consistency Determination.
PREPARED BY: CYNTHIA LARA, COMMUNITY ASSISTANCE MANAGER
REVIEWED BY: DONNA FINCH, COMMUNITY SERVICES DIRECTOR
SUBMITTED BY: JOANNE COLETTA, PLANNING & DEVELOPMENT DIRECTOR
Exhibits:
1. Exhibit 1 - Resolution No. 2637
2. Exhibit 2 - Location Map
3. Exhibit 3 - Project Rendering