COUNCIL COMMUNICATION

Transcription

1 Meeting Date: April 24, 2018 COUNCIL COMMUNICATION Agenda Item: Agenda Location: Action Items Work Plan # Legal Review: 1 st Reading 2 nd Reading Subject: A resolution approving an affordable housing incentive agreement among the City of Thornton, the Housing Authority of the County of Adams, doing business as Unison Housing Partners, and Crossing Pointe North LLLP to develop 64 apartments for low-income seniors. Recommended by: Jeff Coder Approved by: Kevin S. Woods Ordinance previously Presenter(s): Nicole Jeffers, Neighborhood Services Manager introduced by: SYNOPSIS: This incentive agreement will reduce costs and provide subsidies to the Housing Authority of the County of Adams, doing business as Unison Housing Partners (UHP), to construct an affordable apartment building with 64 apartments for low-income seniors at 4220 E. 104th Avenue in Thornton. This apartment building, to be named Crossing Pointe North, will serve seniors who are 62 years of age or older. It will increase the amount of housing units in the City for low-income households and the housing will be located within walking distance of regional public transportation, food, and health services. RECOMMENDATION: Staff recommends Alternative No. 1, to approve the resolution for the affordable housing incentive agreement because the City of Thornton s Affordable Housing Policy approved on June 7, 2011, proclaims Thornton s commitment to work to expand the supply and distribution of safe affordable housing in the City. The policy states that the Thornton City Council may consider providing financial support on a case-by-case basis in order to facilitate the development or redevelopment of housing that serves low-income people. Increasing the amount of affordable housing in the City and locating it near transit and other services are goals identified in the City s Affordable Housing Policy. BUDGET/STAFF IMPLICATIONS: The incentive agreement includes exercising a utility credit in the amount of $1,002,174 that will be applied to the water connection, sewer connection and water resource fees; using $102,863 of Community Development Block Grant funds to rebate UHP the cost of the Metro Wastewater fee, construction water fee, meter fee and fees for the single-family residential equivalent water units; allowing the use of City property for water detention from the full Crossing Pointe site, saving the developer approximately $680,000; and reducing development requirements estimated to save the developer $199,772 in costs. ALTERNATIVES: 1. Approve the resolution for the affordable housing incentive agreement as written. 2. Do not approve the resolution.

2 COUNCIL COMMUNICATION PAGE 2 BACKGROUND (ANALYSIS/NEXT STEPS/HISTORY): Affordable housing is any residential structure that is financially affordable to an individual who is or family that are in the low- and moderate-income ranges in a geographic area. The U.S. Department of Housing and Urban Development (HUD) states that to be affordable an individual or family should pay no more than 30% of their monthly income on housing costs, including mortgage or rent plus the cost of heat, electrical, water, home insurance, homeowners association, or metro district fees. The most recent Thornton Housing Needs Assessment from 2014 indicated that 21,257 Thornton households met the HUD definition of low-income, yet there were only 1,349 affordable rental housing and 384 Housing Choice Vouchers being used in Thornton. Since this assessment was published, the home values and rent prices have increased by more than 32% but the median housing income has only risen 24%. This data indicates that more than 19,500 households are cost burdened, meaning they are paying more than 30% of their income for housing. UHP met with the City Council on May 9, 2017 to request financial assistance to develop a building with 64 apartments for seniors who are at 60% of the area median income or less on the vacant parcel at 4220 E. 104th Avenue in Thornton. On that evening, Council provided direction to staff to identify potential fee waivers, rebates, reductions in development standards, and funding mechanisms that would total approximately $1.2 million in incentives for the project. The Housing Authority purchased the vacant parcel at 4220 E. 104th Avenue on December 15, 2014 with the intention to develop one building with 64 apartments for low-income people 62 years of age or older and two buildings with 142 apartments for families. UHP has been awarded the following funding to construct the senior apartment building: Low Income Housing Tax Credits in the amount of $12,400,000 Colorado Division of Housing in the amount of $640,000 County Home Investment Partnership funds in the amount of $830,000 Colorado Housing and Finance Authority Risk Share Loan in the amount of $4,000,000 In order to use the Low Income Housing Tax Credits, UHP created a separate company with a private investor, who will have 99.99% ownership in the project. Crossing Pointe North LLLP will be the entity that owns the senior apartment building and leases the land under and around the apartments pursuant to a 65-year lease. UHP will continue to own the land at 4220 E. 104th Avenue. The general partner of Crossing Pointe North LLLP is an entity called Crossing Pointe North GP LLC, of which Unison Housing Partners is the sole member/manager. Crossing Pointe North GP LLC will have.01% ownership in the project. UHP will be the project manager of the development of the apartments. The private investor is Wells Fargo Community Lending. UHP will rent the apartments to seniors earning 60% area median income or less, using the HUD calculations for the Denver Metro area to determine who is eligible: 30% area median income = $17,650 for one person or $20,150 for a couple 40% area median income = $25,841 for one person or $29,532 for a couple 50% area median income = $29,400 for one person or $33,600 for a couple 60% area median income = $38,761 for one person or $44,299 for a couple The Housing Authority of Adams County was established on November 20, 1974 to provide decent and safe rental housing for eligible low-income families, the elderly, and persons with disabilities. On

3 COUNCIL COMMUNICATION PAGE 3 March 5, 2018, the Housing Authority of Adams County began doing business as Unison Housing Partners. Unison Housing Partners owns and manages four apartment complexes in Thornton that provide 733 units of subsidized housing: Aztec Villa, 8675 Mariposa Street Creekside Place, 9189 Gale Boulevard Overlook at Thornton, 647 W. 91 st Avenue Village of Yorkshire, Brendon Way The City s budget is based on income from permit fees, use tax, easement costs, and water and sewer tap fees. Waiving or rebating fees results in less funds coming into the general fund. The City Charter does not allow the City Council to rebate or waive water or sewer tap fees, since these fees are in the Utility Fund or are costs charged by Metro Wastewater. These costs can only be paid for by the developer or property owner or through other sources of funding, including exercising a credit, or using grant funds. History: March 20, 2018 City Council reviewed the options for the incentive agreement and received advice from the City Attorney. May 9, 2017 Staff from the Housing Authority of the County of Adams met with the City Council to request incentives for the Crossing Pointe affordable housing project. March 29, 2016 The City Council approved the Overall Development Plan, Conceptual Site Plan and Planned Development Standards to develop age-restricted senior and affordable multifamily housing for the site at a public hearing.

4 R E S O L U T I O N A RESOLUTION APPROVING AN AFFORDABLE HOUSING INCENTIVE AGREEMENT AMONG THE CITY OF THORNTON, THE HOUSING AUTHORITY OF THE COUNTY OF ADAMS, DOING BUSINESS AS UNISON HOUSING PARTNERS, AND CROSSING POINTE NORTH LLLP TO DEVELOP 64 APARTMENTS FOR LOW- INCOME SENIORS. WHEREAS, the City of Thornton s Affordable Housing Policy (Policy), approved on June 7, 2011, proclaims Thornton s commitment to work to expand the supply and distribution of safe affordable housing in the City; and WHEREAS, the Policy states that the City Council may consider providing financial support on a case-by-case basis in order to facilitate the development or redevelopment of housing that serves low-income people; and WHEREAS, staff from the Housing Authority of the County of Adams met with City Council on May 9, 2017 to request financial assistance to develop a building with 64 apartments for people who are at 60% of the area median income or less on the vacant parcel at 4220 E. 104th Avenue; and WHEREAS, the Housing Authority of the County of Adams is the owner of the vacant parcel at 4220 E. 104th Avenue and has received approval from City Council for the Overall Development Plan and Conceptual Site Plan to develop age-restricted senior and affordable multifamily housing on the site; and WHEREAS, Crossing Pointe North LLLP will be the owner of the Senior Apartment Building and the Housing Authority of the County of Adams is the sole member/manager of Crossing Pointe North GP LLC, which is the general partner of Crossing Pointe North LLLP; and WHEREAS, the City Council wishes to support increasing the amount of affordable housing in Thornton and provide incentives to the Crossing Pointe North affordable housing project as identified in the attached Affordable Housing Incentive Agreement. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF THORNTON, COLORADO, AS FOLLOWS: 1. That the City Council hereby approves the attached Affordable Housing Incentive Agreement with the Housing Authority of the County of Adams, D/B/A Unison Housing Partners and Crossing Pointe North LLLP for the development of 64 apartments for low-income people who are 62 and older.

5 2. That the City Manager is authorized to sign on behalf of the City, and the Clerk to attest, the attached Affordable Housing Incentive Agreement. PASSED AND ADOPTED at a regular meeting of the City Council of the City of Thornton, Colorado, on, CITY OF THORNTON, COLORADO ATTEST: Heidi K. Williams, Mayor Kristen N. Rosenbaum, City Clerk 2