SONOMA COMMUNITY DEVELOPMENT AGENCY FIVE YEAR IMPLEMENTATION PLAN 2010 through 2014

Transcription

1 Adopted by Sonoma Community Development Agency Board at a regular meeting held on December 16, 2009 Sonoma Community Development Agency City of Sonoma No. 1, The Plaza Sonoma, CA (707) SONOMA COMMUNITY DEVELOPMENT AGENCY FIVE YEAR IMPLEMENTATION PLAN 2010 through 2014

2 INTRODUCTION This document is the required Five-Year Implementation Plan ("Plan") for the Sonoma Community Development Agency ("CDA" or "Agency") Project Area in the City of Sonoma. This Plan presents the Agency's goals and objectives, anticipated projects and programs, and estimated expenditures for the five year planning period covering the period January 1, 2010 through December 31, CONTENTS OF THE IMPLEMENTATION PLAN Section of the California Community Redevelopment Law (Health and Safety Code and Section et. seq.) (the "Law"), requires this Plan to include the following: Agency goals and objectives for the Sonoma Community Development Project Area ("Project Area"); Programs, potential projects, and estimated expenditures proposed by the Agency over the next five years, and; An explanation of how Agency goals, objectives, programs, and expenditures will eliminate blight within the Project Area and improve and increase the supply of housing affordable to very low, low, and moderate income households. The Law requires that this Plan address the Agency's affordable housing production and replacement housing needs and achievements. The primary purpose of the Implementation Plan is to provide a reasonably detailed, yet flexible framework for implementing the Agency's broad objectives and Agency goals for both the Original Project Area and the Amendment No. 1 Area {detailed in the "Background" section below). A second purpose of the Plan is to inform affected taxing entities, businesspersons, residents, community organizations, and interested citizens of anticipated actions to be taken and expenditures to be made during the next stage of the redevelopment program. The Plan serves as a policy and strategy document, rather than a contract, that guides current and future projects and programs by the Agency. As noted in Section 33490, adoption of the Plan does not constitute an approval of any specific program, project, or expenditure, and adoption of the Plan does not constitute a project within the meaning of the California Environmental Quality Act. Projects to be undertaken by the Agency are subject to discretionary approvals by the Agency as well as environmental clearance. The Agency may amend the Plan at any time after conducting a public hearing on a proposed amendment. CURRENT FINANCIAL ENVIRONMENT The State of California in enacting ABX4-26, Chapter 21, Statutes of 2009, requires redevelopment ageocies to shift a total of $1.7 billion in property tax revenues to K-12 schools during the fiscal year via the Supplemental Educational Revenue Augmentation Funds (SERAF). The law requires that each redevelopment agency allocate the specified amount to the County Auditor-Controller for deposit into the SERAF on or before May 10, By March 1, 2010, the redevelopment agency board of each Agency must report to the County Auditor Controller how it intends to make the payment. Payment may be made from redevelopment tax Page 1 of 18,...,,.,~1nr.

3 for the SERAF payment for fiscal year is $1,920,016, and another estimated $394,918 Page 2of ,.,.. r--1,.,r. BACKGROUND The City of Sonoma formed its redevelopment agency, the Community Development Agency, in 1983 and adopted a redevelopment plan later that year. The Agency's intent was to eliminate the blighting influences in Sonoma that were damaging Sonoma's business climate, the physical appearance of historical resources, traffic circulation, and quality of life. Those goals were amended and expanded upon with the adoption of the Project Area Amendment adding territory in Two additional Amendments have been completed since 1999, both making only financial changes to the Plan. The Agency identified several broad objectives that it intended to meet: 1. Reduce the costs of providing urban services 2. Ensure economic stability 3. Increase local employment opportunities 4. Preserve the unique historic character of the community 5. Facilitate the development of affordable housing 6. Increase sales, business, and property tax revenues 7. Generally enhance the quality of life for all persons living, working, or enjoying leisure time in Sonoma The Agency then identified five specific categories of blight and set five agency goals for eliminating each category: 1. Eliminate blighting influences and environmental deficiencies for fiscal year In preparing this Implementation Plan, it is noted that this taking by the State of California has a substantial impact on the ability of the Agency to fund its ongoing and planned programs and projects for the near future. The California Redevelopment Association (CRA) has filed a lawsuit in Sacramento Superior Court to stop ABX4-26. The lawsuit challenges the constitutionality of ABX4-26 and seeks to prevent the State from taking redevelopment funds for non-redevelopment purposes. Since the outcome of the lawsuit is unknown at this time, this Plan is prepared with the understanding that the State taking a total estimated amount of $2,314,934 combined for fiscal years and in the form of the SERAF payment may be upheld by the courts. Given the changing circumstances with the State's budget, as well as the reduction in property values due to reassessments taking place throughout the Original Area and Amendment No. 1 Area as a result of the weak economy, the Agency may consider conducting a financial analysis and projection of future revenues for the Agency, to be completed during the term of this Implementation Plan. This information and analysis would assist with planning and strategizing the CDA's priorities and resources in a changing economic environment. increment, redevelopment bond, Joan from the low-moderate income housing fund (to by repaid by June 30, 2015), or through borrowing from a City fund. The amount due from the Sonoma Community Development Agency to the State of California

4 3. Rehabilitate historic structures within Sonoma Plaza Historic District to strengthen the economic base of the community and to promote orderly commercial expansion by private enterprise..,...,..,,,.,,... Page 3of18 2. Acquisition and disposition of property acquired for uses in accordance with the Amendment; 3. Redevelopment of land by private enterprise or public agencies for uses in accordance with the Amendment; As provided in the redevelopment plan for the 1997 boundary amendment, the Agency proposed to eliminate and prevent the spread of blight in the Amendment Area by: 1. Installation, construction, reconstruction, redesign, or reuse of streets, utilities, curbs, gutters, sidewalks, street lighting, landscaping, and other public improvements; 9. Dispose of real property acquired by the Agency in the Amendment Area, including property conveyed to the City in accordance with State and other laws. 10. Encourage the redevelopment of the Amendment Area through the cooperation of private enterprise and public agencies. 7. Increase and improve the community's supply of affordable housing. 8. Acquire real property. 5. Provide relocation assistance where Agency activities result in displacement. 6. Provide public infrastructure improvements and community facilities, such as the installation, construction and/or reconstruction of streets, utilities, public buildings, facilities, structures, street lighting, landscaping and other improvements which are necessary for the effective redevelopment of the Amendment Area. 3. Provide for participation in the redevelopment of property in the Amendment Area by owners who agree to so participate in conformity with the redevelopment plan for the amendment area. 4. Provide for the management of property owned or acquired by the Agency. 2. Provide for the rehabilitation of structures in the Amendment Area. In 1997, the Agency implemented a boundary amendment adding 304 acres to the project area. The purposes and objectives set forth in the redevelopment plan for the Amendment Area were as follows: 1. Encourage employment opportunities through environmental and economic improvements resulting from redevelopment activities. 5. Promote orderly development of vacant and infill properties in a manner consistent with the City's General Plan 4. Provide storm drainage improvements to eliminate recurring flood conditions and attendant property damage 2. Improve public parking and pedestrian and vehicular circulation to enhance traffic safety and flow characteristics

5 Page 4of18 "'"'"""',...,.., The time limit for commencement of eminent domain proceedings to acquire property in the project area has expired. The Agency can only collect tax increment to pay off debt incurred before December 16, Amendment No.1 area deadlines: December 6, 2027 (plan duration). The time limit for receipt of tax increment for Amendment No. 1 area is December 6, REDEVELOPMENT PLAN LIMITS The Law requires the Plan to include the time limits to incur indebtedness. The time limit to incur indebtedness: For the original redevelopment project area, the time limit to incur indebtedness was January 1, The time limit has been reached and no additional indebtedness can be incurred with respect to the original project area. For the Amendment No. 1 area, the time limit to incur indebtedness is 20 years from the effective date of the ordinance adopting the amendment (December 6, 1997): December 6, The time limit on the effectiveness of the redevelopment plan and on the receipt of tax increment: The original redevelopment plan ends December 28, 2023 (plan duration). Time limit for receipt of tax increment for the original redevelopment plan ends Dec. 28, families, seniors and handicapped individuals within the community of Sonoma; 6. Financing of the construction of residential, commercial and industrial buildings and the mortgage financing of residential, commercial and industrial buildings, as permitted by applicable State and local laws, to increase the residential, commercial and industrial base of the City and the number of temporary and permanent jobs within the City; 7. In appropriate cases, rehabilitation of structures and improvements or development of vacant land by present owners, their successors and the Agency for uses in accordance with the Amendment; 8. The upgrading and modernization of the existing commercial center to serve the needs of the City of Sonoma and surrounding area; 9. Maintenance of the existing level of commercial facilities in the Amendment Area to serve the City of Sonoma and surrounding communities; and 10. Such other action as may be permitted by law and changes in State law including State takes of local redevelopment funds. The specific goals and objectives set forth for this Implementation Plan are based upon the statement of goals and objectives in the Original and Amended Redevelopment Plan, which are hereby incorporated in this Plan by reference. 4. Construction and improvement of recreational facilities, community facilities, parking facilities and other public facilities; 5. Acquisition, construction or rehabilitation of housing for low and moderate-income

6 Page 5of18... f:olr\t"> Plaza Renovation $151,739 $348,140 $278, $778,506 (electric) & (pond) Plaza $2,470 $3, $6,066 Amphitheater Police Building $77,344 $591,469 $2,012,386 $3,322,936 $164,194 $6,168,329 Rehabilitation Sonoma Valley $267,000 Alarm Panel Switch and Fire Hospital Generator $267,000 Street/ Sidewalk $1,036,331 $1,040,021 $3,974,643 $530,763 $522,279 $7,104,037 Improvements Parking/Public $299,298 $299,298 Traffic Calming 0 $27, $27,285 TOTAL CAPITAL PROJECTS $1,453,593 $4,829,630 $6,924,397 $4,752,859 $1,302,634 $19,263,113 Tree Planting $26,975 $17,119 $18,989 $21,215 $13,800 $98,098 (Regular Program) Corporation Yard 0 $2,000 $221,455 $798,171 $30,361 $1,051,987 Building Public Facility 0 0 $8,907 $79,774 $315 $88,996 Accessibility/ADA Bike Paths $158,734 0 $59,390 0 $5,387 $223,511 Maysonnave 0 0 $350, $350,000 House Historic Rehabilttation Old Firehouse 0 $2,800, $2,800,000 Purchase CAPITAL PROJECTS 04/05 05/06 06/ /09 Totals: NON-HOUSING PROGRAMS, PROJECTS AND EXPENDITURES The Agency has participated in a number of projects to help alleviate blight in the Project Area. These include landscape projects, traffic/pedestrian safety and circulation improvements, bike path improvements, street resurfacing, parking lot acquisition and improvement, financing of the construction or improvement of commercial and non-profit buildings in the Project Area and seismic upgrading of historic buildings. Tables 1 and 2 list the projects and expenditures for Table 1 - Capital Projects

7 Page 6of18 _,.r\mdll'\i"\ PROJECTS: Projects paid for through tax increment and bond proceeds, which were planned or started prior to the commencement of this Implementation Plan period, but are not yet completed or are continuing, are listed below. The listing of potential projects does not constitute a decision or detemiination by the CDA Board to undertake any particular project or to fund any particular project. Decisions as to which project or projects to undertake and the funding level for such project(s) will be subject to separate discussion and decision by the CDA Board as part of the budget process or on a case-by-case basis. All amounts shown are approximations only and are subject to change. ANTICIPATED PLANNING PERIOD PROJECTS AND PROGRAMS The following narrative describes the non-housing programs proposed for the next five years. Anticipated expenditures are based upon the combined proceeds from (1) the Agency's 2003 Tax Allocation Bond sale, and (2) the portion of the Agency's property tax increment revenues which are not already pledged to debt service. Greater or lesser property tax increment revenues may be available, depending upon changes of assessed valuation in the Project Area. Tables 1 and 2 are inclusive of bond and increment funded projects. TOTAL ECONOMIC DEVELOPMENT PROJECTS $115,250 $130,875 $383,135 $300,619 $500,507 $1,430,386 Old Fire Station environmental clean up in preparation for economic development re-use Other Commercial Building Rehabilitation Loans Including Energy Efficiency and Photovoltaic (solar) Installation Loans $179,436 $179, $162,000 $145,482 $307,482 Economic Development Project Partnership $75,000 $75,000 $75,000 $75,000 $75,000 $375,000 Fai;:ade Improvement Grants $4,250 $1,875 $4,135 $3,119 $46,589 $59,968 Sebastiani Theater $36,000 $36,000 $36,000 $36,000 $36,000 $180,000 Sonoma Community Center Rehabilitation 0 0 $250, $250,000 Year 04/05 05/ /08 08/09 Totals Present Casa Grande Parking Lot 0 $18,000 $18,000 $18,000 $18,000 $72,000 Lease Signage - Wayfinding $6,500 0 $6,500 Table 2 - Economic Development Projects

8 1. ADA Improvements: Provide safety and accessibility enhancements to public facilities, thus eliminating barriers in compliance with the Americans with Disabilities Act. The projects meet Implementation Plan goals by improving quality of life, safety, and upgrading public structures, many of which are historic. Representative ADA projects include: a. Depot Park Museum Improvements$ 60,000 (over 1 year) b. Building Projects$ 800,000 (over 4 years) c. Depot Park Improvements$ 264,000 (over 1 year) d. Park Accessibility Improvements$ 1,000,000 (over 4 years) 2. Street Improvements: This project includes resurfacing and repairs to streets listed in the Capital Improvement Program budget, in or serving the project area, to eliminate blighting and unsafe conditions. The project will improve infrastructure, provide safe access for pedestrians and vehicles and improve traffic flow. Representative street improvement projects include: a. Heather Lane Area$ 437,000 b. Fano Lane Area/Bettencourt Area $1,874,000 c. France Street$ 171,500 d. Chase Street$ 300,000 e. Broadway/Larkin $ 400,000 f. Bridge - Chase Street (environmental requirements)$ 242, Sidewalks/Bikeways/Parks/Storm Drain Improvements: This project includes eliminating blighting conditions of broken pavement and inadequate sidewalks along streets in, and immediately adjacent to, the project area. The project would also meet the goal of improving pedestrian and bicycle safety. In addition, storm drain improvements will eliminate or lessen recurring flood conditions and attendant property damage. Representative improvement projects include: a. Bikeway Improvements (Carryover) $ 280,000 b. Storm Drainage aerial mapping$ 100,000 c. Other park improvements, including but not limited to play court resurfacing, restroom remodeling $70, Police Station Emergency Generator Replacement Project: $427,000 This project provides for meeting the standards for essential services such as police and emergency operations in the event of a power outage or disaster. The project meets the goals of improving services, rehabilitating public structures, and improving safety of the Project Area. Page 7of18.<<"'\/;.r.-1...,..,

9 5. Tree Planting (Regular Program) $25,000 Annually This project provides for planting trees along streets in the project area and in public parks to improve parks, eliminate blight, and eliminate environmental deficiencies, all goals of the Implementation Plan. Page 8of18...,.. ~lt"ll"\ 7. Downtown Parking Improvements -Amount Undetermined at this time. This includes leased parking lot space to serve the downtown area, as well as other potential parking improvements and/or parking management systems. By providing adequate public parking for persons visiting restaurants, shops, historic sites etc., this project supports the goal of improving public parking and pedestrian and vehicular circulation to enhance traffic safety and flow characteristics. It improves community facilities, eliminates blighting conditions, and adds to quality of life. 8. Economic Development Project Partnership $75,000 Annually: $375,000 This was the second Five Year Plan the City will have an ongoing project with the Sonoma Valley Chamber of Commerce to provide business retention, enhancement, and stimulation in the project area. Funding was for the cost of an Economic Development Project Manager, trainers and direct costs related to the program. It meets the goals of ensuring economic stability, increases sales and property taxes through orderly development, and increases employment opportunities. The County now participates in the Partnership through the Springs Redevelopment Area, and provides approximately $15,000 of the annual funding for the program, reducing CDA funding by a like amount. 9. Commercial Revitalization and Business Improvement Loan Programs $400,000 Annually: $2,000,000 This provides for loan programs to commercial property owners and/or business owners in the project area for facade improvement, building rehabilitation and renovation, historic building improvements, energy efficiency improvements including but not limited to photovoltaic systems, and upgraded utility systems. Goals being met include the enhancement of several historic buildings, improvement of sales tax, and in some cases, elimination of blight caused by deterioration or neglect 10. Sebastiani Theater $36,000 Annually through 2011 =approximately $72,000 This is a program that provides a long-term lease write-down to the operator of the historic Sebastiani Theater, to keep the theater in operation. This project meets the goal of encouraging rehabilitation and use of historic buildings and preserving the character of the town center. The theater continues to operate and is considered a treasured historic site in Sonoma. There is no current CDA funding commitment beyond the lease expiration date but the project is listed here in the event of a further or future agreement concerning this property. 6. Signage $35,000 Annually for three years: $105,000 This provides for completion of the Off-Plaza Wayfinding Signage Program and possible additional signage directing visitors to and throughout the project area. This project supports the goals of ensuring economic stability, increasing sales tax revenues, and improving pedestrian and vehicular circulation.

10 11. Historic Conservation Easement with the Sonoma Community Center: $100,000 The Agency pursued the preservation of the Sonoma Community Center building through the acquisition of a historic preservation easement. Through this instrument, the CDA required that the Sonoma Community Center organization maintain this building to preserve its historic nature, preserve its National Historic Landmark designation status, and ensure its structural integrity, physical features and overall general maintenance. In addition, the easement requires that the building be continued to be operated as a "community center'' with programs open to the public to fulfill social and recreational needs of residents. The agreement advances one of the stated goals of the Agency, to rehabilitate and preserve historical structures. The agreement was approved by the Agency in December 2008 for a one-year term. 12. Public Improvements Reimbursement Agreement with Friedman's Home Improvement: $125,000 As part of their major remodel, Friedman's Home Improvement was required to comply with a Planning Commission condition of approval which consisted of the widening of Napa Road and the installation of a new tum lane and median refuge. The Sonoma Community Development Agency participated in funding these public improvements since they benefit not only the property but the public utilizing the roadway. The proposal is an appropriate use of redevelopment funding, as it supports the local business by offsetting a City permit cost and funds a permanent improvement that is for the public's benefit for many years to come. The agreement was approved by the Agency in October Field of Dreams Public Improvements Reimbursement Agreement: $33,000 The City of Sonoma leases certain property to the Sonoma Valley Field of Dreams non-profit corporation. The Agency approved of the acquisition of certain drainage improvements to the leased property and the payment by the Agency in the amount of $33,000. This project supports the purposes of the Redevelopment Plan by providing for the acquisition of drainage improvements which facilitate more productive use of the premises which will thereby benefit the Project Area and community. The agreement was approved by the Agency in August Neighborhood Beautification: $100,000 A graffiti removal program was established in 2008 to remove graffiti from public improvements throughout the project area. Hundreds of graffiti tags are removed annually to remove this blight from public and private property, and to prevent the reoccurrence and attraction of graffiti through prompt removal and community awareness efforts. 15. Clean and Renewable Energy Bonds Payment for Photovoltaic Systems on City Facilities: approximately $100,000 per year The City was awarded Clean and Renewable Energy Bonds (CREBS) to install photovoltaic systems on certain City facilities. The Agency is participating the payment on the CREBS bonds in order to lower the cost of utility operations for these facilities. This project meets the Agency objective of reducing the cost of providing urban services. Page 9of18... ur.o1r.,.,

11 Page 10of18...,.. "".',, PROJECTS IN DEVELOPMENT STAGE The following projects are in various stages of discussion and development. Cost estimates have not been developed for all of the projects. The listing ofpotential projects does not constitute a decision or determination by the CDA Board to undertake any particular project or to fund any particular project. Decisions as to which project or projects to undertake and the funding level for such project(s) will be subject to separate discussion and decision by the CDA Board as part of the budget process or on a case-by-case basis. All amounts shown are approximations only and are subject to change. 1. Blue Wing Inn Conservation and Stabilization The Blue Wing Inn is a historic adobe structure within the project area in downtown Sonoma. The building is owned by the State of California, and the Agency has entered into a memorandum of understanding to jointly fund with the State the conservation and stabilization studies and work needed to preserve this building and eventually for its reuse as a potential economic development project, whether as a retail use, or as a tourist feature of the downtown. This project meets the goal of encouraging rehabilitation and use of historic buildings and preserving the character of the town center. Actual cost of these studies and the work of stabilization has not yet been determined. 2. Community Swimming Pool The Agency and the Sonoma Valley Unified School District have undertaken discussions regarding a joint community swimming pool project that would benefit the Agency and the District. This project would meet the Agency's goal of construction and improvement of recreational facilities, community facilities, and other public facilities in the Project Area. Actual cost of the improvements, and the Agency's contribution, has not yet been determined. 3. Sonoma Valley Library Renovation/Remodel Project The Sonoma Valley Library building, a facility owned by the City of Sonoma, is in need of renovation. A Concept Plan Analysis prepared for the proposed Sonoma Valley Regional Library Remodel Project was prepared by an architectural firm in The scope of the project includes the addition of self-check technology, a new teen room, upgrades for compliance with the Americans with Disability Act (ADA), new HVAC, reroofing, fire sprinklers, display casework, shelving, energy efficiency improvements and related upgrades. As of 2008, the total cost of the project was estimated at $2,469,425. This project meets the Agency's goals of providing public infrastructure improvements and community facilities, as well as generally enhancing the quality of life for all persons living, working, or enjoying leisure time in Sonoma. The Agency's contribution to the project has not yet been determined. 4. Sonoma Valley Veterans' Memorial Hall The Sonoma Valley Veterans' Memorial Hall is a facility owned by the County of Sonoma, designated by grant deed for the primary use by war veterans, with ancillary uses for special events and large meetings. Discussion has taken place between City/Agency personnel and the County of Sonoma regarding a lease, joint use agreement or other instrument whereby the Agency would assist with facility upgrades with the intent of improving the facility for increased use as a large events venue, which could contribute to the City of Sonoma's tax base, including sales tax and transient occupancy tax through generation of additional visitors to the City. This project would

12 meet the Agency's goals of ensuring economic stability, potentially increasing local employment opportunities, and increasing tax revenues. Actual cost of the improvements, and the Agency's contribution, has not yet been determined. 5. Sale of Old Fire Station, 32 Patten Street, Sonoma, for Tax-Generating Re-use In 2006, the Agency purchased from the City of Sonoma the Old Fire Station at 32 Patten Street, Sonoma. for the purpose of environmental clean up and redevelopment of the property. The Agency is currently entering into a Disposition and Development Agreement with a developer who has submitted an offer to purchase the property. This project meets the Agency's goals of reusing a blighted property through environmental clean up and preparation for a tax-generating use. The project also achieves the goal of insuring orderly development in the Project Area. The intent of the project is to increase local employment opportunities, and increase sales, business and property tax revenues, which strengthens economic stability. 6. Economic Development Assistance for Private Development The Agency will be considering on a case-by-case basis and potentially funding private development projects that meet economic goals of the redevelopment plan for the Original and Amendment No. 1 Areas. Large projects which have the potential for increasing local employment opportunities, increasing sales, business, transient occupancy and property tax revenues will be considered for assistance under the Agency's business improvement loan program. 7, Historic Preservation Efforts The Agency will be considering on a case-by-case basis and potentially funding historic preservation projects that meet the Agency's goal of preserving the unique historic character of the community. These projects may include handicapped accessible upgrades, building rehabilitation, and code compliance for historic structures in the Original and Amendment No. 1 Areas. Page11 of mr.<lr.r.

13 Page 12of18...,..,.,.,,..,,,... The Implementation Plan must also address estimated affordable needs over a ten-year period, which is a different time frame than that used in the regional housing needs allocation process. In order to make this assessment, Table 4, below, assumes the same rate of growth as the ABAG housing needs allocation and the same percentages of need, but over a 10-year period. Table 3 - City of Sonoma Regional Housing Needs Allocation, Very Low Income 73 (21%) Low Income 55 (16%) Moderate Income 69 (19%) Above-moderate Income 156 (44%) Total Need 353 Affordable Housing: State law requires all regional councils of governments, including the Association of Bay Area Governments (ABAG) to determine the existing and projected housing need for its region (Government Code Section et. seq.) and determine the portion allocated to each jurisdiction within the ABAG region. This is known as the "Regional Housing Needs Assessment" (RHNA) process. In 2008 ABAG developed its Regional Housing Needs Allocation (RHNA) based on forecasts contained in Projections 2007: Forecasts for the San Francisco BayArea to the Year Sonoma's housing allocation, as assigned though this process, is set forth in Table 3, below. Implementation plans are required to contain a section describing the Agency's low and moderate-income housing programs. This section may be adopted every five years in conjunction with either the housing element cycle or the implementation plan cycle. The housing section of the plan must contain: Estimates ofthe number of inclusionary units that have been developed and that will be developed by the Agency over the life of this Plan and the next ten years. Amounts presently available and estimates of amounts that will be deposited in the Housing Fund during the next five years. A program that estimates the number of units to be assisted from the Housing Fund during the next five years. Number of units to be replaced and a proposed location for them if the Implementation Plan contains a project that will result in removal of low or moderate income units. The plan must also differentiate between housing developed for seniors and for non-seniors and show that the expenditures for these types of housing are proportionate to local need. Overview of Housing Needs HOUSING PROGRAMS, PROJECTS AND EXPENDITURES

14 Very Low Income 106 (21%) Low Income 80 (16%) Moderate Income 96 (19%) Page 13of18.,,...,.;,,,._,,..,,,... Under State redevelopment law, the requirements for the production of affordable housing within the project area are somewhat different than the city-wide objective established through the regional housing needs determination. In essence, the redevelopment requirement is to produce, preserve or improve affordable housing for low and moderate-income persons ("inclusionary housing production") by ensuring that at least 30% of all Agency-developed housing and 15% of all privately developed housing within the project area are reserved and made affordable to very low, low and moderate-income households (of which, 40% must be for very low income households). Seniors: Another provision of State redevelopment law pertains to the amount to housing setaside funds that may be spent on senior housing. Expenditures for senior housing cannot exceed the proportion of persons 65 and over to the general population of the City. According to the 2000 Census, 24.24% of the City's total population is 65 years of age or older; therefore, over the next 10-year Housing Compliance period, the Agency would be limited to spending 24.24% of its housing set-aside funds on affordable units for _senior citizens. Project Area Affordable Housing Reguirements/lnclusionary Housing Requirements State law mandates that a certain percentage of housing units developed in project areas be affordable to very low-, low-, and moderate-income households. For this purpose, agencies are required to distinguish between units developed directly by the redevelopment agency itself (Agency units) and those developed by other entities (non-agency units). It should be noted that the Agency itself has not directly developed any housing units in the past, nor does_it intend to in the future. Instead, it partners with non-profit housing agencies, such as Burbank Housing, to develop and maintain affordable housing. Therefore this Plan is not required to address, and does not address, matters pertaining to Health and Safety Code Section 33413(b)(1) which are inapplicable. With regard to non-agency developed units, State law mandates that a minimum of 15% of units developed in the project area by entities other than the Agency (dating from the adoption of the Redevelopment Plan through the end of a given period) be affordable for very low-, low-, or moderate-income households, and that 40% of those (or 6% of the total) be affordable for very low-income households. The calculation is on an aggregate rather than a per-project basis. The first step in calculating this requirement is determining the number of non-agency developed units constructed in the Project Area since the adoption of the Redevelopment Plan and then comparing the number of covenanted units required based on that figure to the amount actually constructed during that time period. Above-moderate Income 222 (44%) Total Need 504 Table 4 - Estimated 10-Year Need for Affordable Housing,

15 Built Required Difference Non-Agency: 992 NA NA Covenanted: Page 14of18...,..,,,,,...,... **Includes credit based on development of covenanted units, 'Assuming 35 units per year. Table 7 - Projected Non-Agency and Covenanted Units, Projected Development Net Total Total Requirement, Requirement, Requirement, ** Non-Agency Units 350 N.A N.A N.A Covenanted Units Very Low Low/Moderate **Based on development of covenanted units, *Assuming 35 units per year. Very Low Low/Moderate As shown in Table 5 above, the Agency since its inception has actually exceeded its requirement for the provision of very low income housing by 4 units and its requirement for low and moderate income housing by 62 units. Looking ahead, the Plan must provide estimates of non-agency developed units projected to be built within the project area, both over the next five years encompassed by this Plan and for the 10-year period commencing January 1, 2010 through December 31, 2019, along with the corresponding requirement for the development of covenanted affordable units. These estimates are set forth in Tables 6 and 7, following. Table 6 - Projected Non-Agency and Covenanted Units, Projected Development* Base Requirement Credit** Net Requirement Non-Agency Units 176 N.A N.A N.A Covenanted Units Low/Moderate Very Low Table 5 - Non-Agency and Covenanted Units: (Project Area)

16 Page 15of18...,.. ~,,... The Agency to date has used five primary programs to assist in the provision of affordable rental and owner-occupied housing: Site Acquisition and Development of Affordable Housing. The City and Agency have actively acquired sites and facilitated the development of affordable housing projects utilizing the Agency's 20% housing set-aside tax increment revenues ("Housing Fund"). It should be noted that the Agency itself has not directly developed any housing units in the past, nor does it intend to in the future. Instead, the Agency partners with experienced housing development corporations. It is anticipated that the City/Agency will continue this program by actively seeking available and suitable housing sites within the community and seeking partnerships for their development. Projects already completed include ownership, rental and senior rental projects. Over the previous five-year planning period, the following projects have been completed or initiated: In 2006, the CDA completed the purchase the 34-unit Village Green II apartment development. These affordable, senior apartments were privately developed under a USDA loan that the owner was attempting to terminate, which would have allowed the units to be rented at market rates. The City, through its redevelopment agency, purchased the project for approximately $4 million dollars, thereby securing them as affordable units in perpetuity. A 3-acre property at 404 Napa Road, acquired by the City and rezoned to High Density Residential in 2005, has been developed with a 34-unit affordable housing project (18 low income units and 16 moderate income units). This is an owner-builder development that was managed by Burbank Housing. The CDA contributed approximately $1 million dollars to this project, which was completed in May of (Note: this site is outside of the project area.) The CDA acquired a 1.97-acre property at the corner of Broadway and Clay Street for development with affordable housing. (Purchase price: $2,200,000.) The CDA acquired a 1.97-acre a 2.07-acre property located within the project area on Sonoma Highway for development with affordable housing. (Purchase price: $2,530,000.) The CDA has since entered into an Exclusive Negotiating Agreement with a non-profit affordable housing development corporation with the objective of developing approximately 40 affordable rental units on the property aimed at very-low and lowincome households. In March 2008, the CDA completed construction of a three-unit emergency shelter on the City-owned Police Station property located at 175 First Street West. The shelter is managed under a contract with the CDA by Sonoma Overnight Support, a local nonprofit organization, for the provision of homeless and emergency housing services. The CDA contributed $225,000 to the project cost, with remainder funded by a State grant in the amount of $280,000. Permit & Fee Payments. The Agency pays to the City's General Fund, from the Agency's Low Moderate Income Housing Fund some or all developer building permit fees for all units that have affordability restriction covenants. This program provides substantial cost savings to developers, who can in tum pass the savings on to the development in the form of affordable As shown in Table 7, it is estimated that the development of 16 very low income units and 16 low or moderate income units within the project area will be necessary over the next ten years in order to comply with requirements for the production of covenanted units. Overview of Affordable Housing Programs

17 Page 16of18....,,...,,, '"" 1 1'he MCC and CDBG programs are administered by the Agency; however, the money for these programs is derived from other sources and no Agency funds are expended, except for minor administrative costs. Community Development Block Grant Program. 1 The City of Sonoma, through the Agency, actively participates in the federal CDBG program, which provides lump-sum payments to local agencies. These grants have potential for assisting with low and moderate income housing projects. Taken together, these five housing programs have shown themselves to be effective and will continue to assist in providing affordable housing for households in the project area. Housing Fund Balance and Projected Deposits and Expenditures Table g lists the deposit in the Low and Moderate Income Housing Fund for the current fiscal year of 2oog.2010 and the expected deposits in the fund for the remaining four fiscal years this Down-Payment Assistance. For selected owner-occupied units, the Agency, from its Housing Fund, provides down-payment assistance to qualified applicants. For two recent projects, the Agency provided qualified applicants with 15% of the purchase price of the units. The applicants then provided 5% of the piice themselves, and with the expanded 20% they were able to secure conventional loans for the remaining 80% of the purchase price. This program helps moderate income, first-time homebuyers purchase houses that they would not otherwise be able to afford. More recently, the CDA has focused on the development and acquisition of rental housing. The Wildflower project at 404 Napa Road, was an exception in this regard, but as an owner-builder development, down payment assistance was not required. The CDA Board has expressed interest in establishing a down-payment assistance program for first-time homebuyers. This concept is being investigated, but if pursued, it would not be implemented until FY 2010/11. Mortgage Credit Certificate Program.1 The Sonoma County Mortgage Credit Certificate Program (MCC) provides qualified homebuyers with a federal income tax credit of up to 20% of the annual interest paid on the homebuyer's mortgage. This program allows participants to deduct 80% of their annual interest payments from total gross income when they determine their total tax liability, and then to deduct the remaining 20% of their interest payments from their total tax liability. This essentially gives borrowers more disposable income with which to make their mortgage payments. For example, a homebuyer with a $140,000 mortgage (assuming a 7.5% interest rate) would have an annual credit of nearly $2,100. Given the program's history, this program will assist approximately 10 households over the next five years. FY FY FY FY FY2008-0g Penntt and fee. $16,651 $20,440 $12,644 $13,578 $22,g55 waivers Number of Units assisted units. For some recent projects in Sonoma, the savings have ranged from $1,800 to $2,400 per unit (approximately 3% of each unit's valuation). Table 8 shows the amounts spent by the CDA in permit and fee waivers over the past five years. Table 8 - Permit and fee waivers,

18 the drawdown of fund balance in the current fiscal year of $1.8 for capital projects. Table 9 -Expected Deposits in the Housing Fund by Fiscal Year (FY), Page 17of18...,.. ~,,...,... Housing Units to Be Assisted and Detailed Schedule of Actions Table 11 identifies the expected number of housing units to be assisted (by the Agency and by non-agency entities) through each program, as well as the expected expenditures from the Low and Moderate Income Housing Fund. Total $5,255,000 Project Affordable bv Income Group Nameand Household Extremely Very CDA Term of Address Tenure Type Low Low Low Moderate Assistance Restrictions Road Ownership Family $1,080,000 Village 404 Napa Wildflower/ 45 vears Green*/650 Fourth Street West Rental Senior $3,950,000 Lifetime Shelter/ 171 First Street West N.A. Unrestricted 3 $225,000 Emergency Lifetime Project Project 34 Table 10: Housing Fund Expenditures by Project, Project Expenditures During the Previous Planning Period Over the course of the previous five-year planning period, housing funds were expended on a number of projects. Table 10, below, identifies these projects and provides information on tenure, level of affordability, and program type. FY FY FY FY FY $1,111,472 $1,100,360 $1,110,000 $1,132,200 $1, 154,840 Plan. Note that this Plan covers the period through December 31, 2014, but that Housing Fund Deposits are made on a fiscal year basis and thus Table 9 shows the deposits through the end of FY The current balance in the Housing Fund is approximately $600,000, after

19 Units/ FY FY Afford 2009/10 FY 2010/11 FY 2011/ /13 FY 2013/14 Total ability Page 18of18.. "',.. ~,,.,.,., With respect to the division of future expenditures between senior and non-senior housing, the CDA Board has expressed interest in the concept of integrated developments that include a senior component. In this regard, the Agency will ensure that to the extent that a senior component is specifically designated within an agency-assisted affordable housing development, the proportion of funds used in this regard in terms of designated units will be consistent with the proportionality limitations of State law. Replacement Housing The Agency does not anticipate that any of the Agency's programs will result in the removal of any existing affordable housing units. Should that unexpectedly occur, the Agency shall comply with the requirements of Health and Safety Code Section 33413(a) by replacing those Agencyremoved units within four years of removal. Meeting Plan Objectives All of the assistance programs, inclusionary requirements, and partnership programs with nonprofit housing developers help satisfy the needs and desires of the various age, income, and ethnic groups of the community, maximizing the opportunity for individual choice, and meeting the requirements of state law. In addition these projects enhance the livability of the residential areas throughout the project area and the community as a whole, and improve the supply of housing affordable to very low-, low- and moderate-income households. CONCLUSION The Agency continues to meet the goals set forth in the Redevelopment Plan and Amendments. During the next five-year implementation period, a number of capital, economic development, and housing projects will be undertaken to eliminate blighting conditions and to provide affordable housing. While all of the specific projects have not yet been identified, the Agency will continue to move forward to improve conditions in the project area and to make Sonoma a better place to live, work, and visit Total $135,000 $1,715,000 $1,555,000 $155,000 $255,000 $3,815,000 Emergency Shelter $ $ $30,000 $ $30,000 $150,000 NA Home-buyers 18 Assistance $60,000 $100,000 $100,000 $100,000 $360,000 moderate 25 Fee Write-downs $ $ $ $ $ $ moderate Project/Program Development PartnershiD Sonoma 30very Highwav $80,000 $1 500,000 $1,580,000 low 91ow Affordable Project 30 very TBD $100,000 $1,400,000 $1,500,000 low 91ow Affordable Project TBD $100,000 $100,000 TBD Table 11 - Projected Housing Fund Expenditures by Program,