Agenda Item Wording:
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Second reading and adoption of Ordinance No. 2021-07 authorizing the sale of APN 094-283-001 (300 E Oak Ave.) to Self Help Enterprises at a pre-authorized selling price of $1,200,000. (4/5’s vote required)
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Deadline for Action: 9/7/2021
Submitting Department: Administration
Contact Name and Phone Number: Devon Jones, 4190
Department Recommendation:
Conduct the second reading and adoption of Ordinance No. 2021-07 authorizing the sale of APN 094-283-001 (300 E Oak Ave.) to Self Help Enterprises at a pre-authorized selling price of $1,200,000.
Background Discussion:
Per the City Charter, the Visalia City Council must adopt an ordinance authorizing sale of the previously approved sale of the property at 300 E. Oak Ave. to Self Help Enterprises (SHE) for $1.2 million. The City Council previously authorized the City to sell the property and execute an Option to Purchase - Purchase and Sale Agreement with SHE, which all parties executed in 2019. Two amendments have also been authorized by the Council and executed by the parties. After SHE exercised the Option in 2020, the parties entered into Escrow, which the Agreement as amended requires be completed no later than April 1, 2022. SHE has satisfied all conditions to the closing of Escrow (including obtaining a Conditional Use Permit and securing funding) and as a result is now legally entitled to close at any time prior to that. The adoption of the ordinance authorizing the sale is essentially a formality and the final action required of the City under the Purchase Agreement. SHE will be entitled to close any time prior to April 1, 2022 (SHE and city staff anticipate closing Escrow in October following planned Arts Consortium event activities at the location), and staff therefore requests that the Council complete the formality of adopting the Ordinance as presented in this item.
SHE submitted a proposal through the Surplus Land Sale process in early 2019 to acquire and develop 300 East Oak Avenue for the Lofts at Fort Visalia (Lofts) project that was accepted by Council. SHE proposed development of a three-story mixed-use complex consisting of fifty-one (51) 1-bedroom units and twenty-two (22) 2-bedroom units on the second and third floors, seven (7) 1-bedroom Artist Lofts on the ground floor, and one onsite manager unit. The project will reserve two (2) 1-bedroom and two (2) 2-bedroom units to be fully accessible. The complex will also include an elevator, in addition to a staircase. The Lofts consists of 3,500 square feet on the ground floor for an Art Gallery and Community Room where a wide variety of resident services will be provided. Additional space will house an office, computer lab, laundry room, maintenance, and storage area. The project allows for on-site wraparound supportive services, and an outdoor space will provide picnic tables, shade structures, and playground equipment for children. The project will target mixed-income households (as described below) and include a set-aside for households with disabilities or facing homelessness. The units will serve households at 60% area median income (AMI) or lower. 34-units are designated for households between 0%-30% AMI, 16-units are designated for households between 31%-50% AMI, and 29-units are designated for households between 51%-60% AMI. 40-units are proposed for use as permanent supportive housing (PSH) for persons who are chronically homelessness or at-risk of chronic homelessness.
SHE has secured the other necessary funding to develop the Lofts project, including No Place Like Home Program (NPLH) funds of $9,286,076, Tax Exempt Construction Financing of $15,206,286, Taxable Construction Financing of $6,502,379, Tulare County (TC) Permanent Local Housing Allocation (PLHA) of $583,584, and Impact Fee Credits of $286,317. The impact fee credits are City of Visalia credits based on the information provided to the City during the Site Plan Review process. Given that the project is a mixed-use development that includes commercial and an affordable residential housing component, this project qualifies for a reduction in Transportation Impact Fees per General Plan Land Use Policy LU-P-45 and LU-P-46, “Affordable Housing Infill Incentive Program” as this project is within the Priority 1 criteria area. In addition, impact fee credits for Traffic, Public Facilities and Sewer were calculated based on the previous use of the site. These “impact fee credits” are then applied against the newer higher impact fees based on the new mixed-use project, resulting in a reduction to the total impact fee amount. These credits are not unique to this project, but are based on the existing Council adopted fee credit program.
Securing all the funding is one of SHE’s conditions from the City to close escrow according to
the executed Option to Purchase - Purchase and Sale Agreement (PSA) and corresponding
PSA amendments. SHE also received approval for their Conditional Use Permit for the Lofts
project in 2019 which is another of their conditions to close escrow. The City has one remaining
condition to close escrow and that is for the Council to pass an ordinance authorizing the sale of
the property to SHE.
Fiscal Impact:
$1.2 million will be deposited to the Civic Center Fund per Council General Fund Land Sale policy. The original purchase was funded by the Civic Center Fund.
Prior Council Action: 8.16.21 - Conducted first reading of Ordinance No. 2021-07, 8.5.19 - Authorized staff to proceed with negotiations with SHE for acquisition of the land located at 300 E. Oak Avenue, 9.16.19 - authorized staff to execute Purchase and Sale Option Agreement with SHE, 11.16.20 - Authorized staff to execute a letter of preliminary award with contingencies and conditions for a commitment of HOME and Successor Agency Housing funds
Alternatives: Per Council direction
Recommended Motion (and Alternative Motions if expected):
recommendation
Conduct the second reading and adoption of Ordinance No. 2021-07 authorizing the sale of APN 094-283-001 (300 E Oak Ave.) to Self Help Enterprises at a pre-authorized selling price of $1,200,000.end
Environmental Assessment Status: Conditional Use Permit No. 2019-40 was approved for this project by the Visalia Planning Commission on Dec 9, 2019
CEQA Review: The project is Categorically Exempt from the California Environmental Quality Act (CEQA) pursuant to CEQA Guidelines Section 15332, Categorical Exemption No. 2019-80
Attachments: Ordinance No. 2021-07