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Home My WebLink AboutRES NO 229-05 RESOLUTION NO. 2 2 9 - 0 5 A RESOLUTION OF THE COUNCIL OF THE CITY OF BAKERSFIELD APPROVING THE AMENDED RELOCATION PLAN FOR THE OLD TOWN KERN MIXED·USE PROJECT. WHEREAS, the Old Town Kern-Pioneer Redevelopment Project Area ("Project Area") was established by the Bakersfield City Council in June, 1999; and WHEREAS, the Old Town Kern-Pioneer Redevelopment Plan was adopted by the Bakersfield City Council at the same time; and WHEREAS, one of the goals of the Old Town Kern-Pioneer Redevelopment Plan is to eliminate blight and encourage development in the Project Area; and WHEREAS, as such, the Agency and developers are proposing developing a housing project and commercial development in the Project Area ("the Old Town Kern Mixed-Use Project"); and WHEREAS, if the Old Town Kern Mixed-Use Project is approved, a number of low and moderate-income residential units will be eliminated from the housing stock; and WHEREAS, California law requires a public entity to ensure that any displaced resident will be relocated to a decent, safe and sanitary replacement dwelling unit and that the project will not proceed unless there are such dwelling units available; and WHEREAS, to ensure that displaced residents, businesses and non-profits will have appropriate replacement properties in which to relocate, the Bakersfield Redevelopment Agency and the Bakersfield City Council must adopt a relocation plan. NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Bakersfield as follows: 1. The above recitals are true and correct. 2. The amended relocation plan attached hereto as Exhibit "A" is hereby approved to be implemented should the Old Town Kern Mixed-Use Project be approved and proceed. .-;:'ME">jJ Ò' ·(P >-- ~ I- m _ r- CJ Ö ORIGINAL I HEREBY CERTIFY that the foregoing Resolution was passed and adopted by the Cour;lcil of the City of Bakersfield at a regular meeting thereof held on OCT 12 2005 by the following vote: ,~ NOES: ABST IN: ( ,ABSE~ o/v --- -- .,.......-- COUNCILMEMBER CARSON, BENHAM, MAGGARD, COUCH, HANSON, SULLIVAN, SCRIVNER COUNCILMEMBER COUNCILMEMBER COUNCILMEMBER ~\-\{1 "V\~r-.-.../ APPROVED OCT 1 22005 Lt. PAMELA A. McCARTHY. MC CITY CLERK and Ex Offici lerk of the Council of the City of Bakersfield HARVEY . HALL MAYOR of the City of Bakersfield APPROVED as to form: VIRGINIA GENNARO City Attorney By: ~ Øt. ~ ALLEN SHAW Deputy City Attorney 'òi>.Kt èi ?>ó> >. ~ I- m _ r- o <::J ORIGINAL EXHIBIT A August 2005 Amended Relocation Plan for the Old Town Kern Mixed-Use Project Bakersfield Redevelopment Agency and City of Bakersfield Old Town Kern-Pioneer Redevelopment Project Area ~ ~!\Kf'l () ó' ~ ~ I- m .- l"- e) c> ORiGiNAL AMENDED RELOCATION PLAN FOR THE OLD TOWM KERN MIXED.USE PROJECT The Relocation Plan for the Old Town Kern Mixed-Use Project is being amended to reflect changes in the proposed scope of development. This document shows only amendments to the previous adopted September 2002 Relocation Plan for the Old Town Kern Mixed-Use Project. All other information in the original plan is applicable. INTRODUCTION In August 2005, the Bakersfield Redevelopment Agency approved an agreement initiating negotiations with Baker Street Village, LLC formed by The Triumph Companies (Triumph). As a result, the proposed scope of the project has changed. The revised development proposal for the Old Town Kern Mixed Use Development Project consists of approximately 49,200 square feet of retail comprising five buildings, rehabilitation of the existing Coronet Building, 14 loft units above two of the retail buildings, 18 three bedroom/family-room townhomes, and 60 one and two bedroom affordable senior units. As a result, the western boundary of the proposed development has been extended to include three residential properties located on Kern Street north of the alley. An Exclusive Negotiation Agreement between the Bakersfield Redevelopment Agency and The Village at Baker Street, LLC was approved August 8, 2005. The agreement covers a period of 120 days from the date of execution of the Agreement. The 120-day limit may be extended sixty (60) days by written amendment. During that time, Triumph will complete their development planning, economic analysis and financial due diligence and work with staff to draft the deal points required for the development to proceed. The deal points will then be incorporated into a Disposition and Development Agreement that will include the specific scope of the development, any Agency financial participation requirements, a schedule of performance, evidence of private financing, required insurance, and evidence of commercial leases for tenants that would also be involved in the project. The project area is bounded by Kern Street on the west, King Street on the east, Kentucky Street on the south and Lake Street on the north. PROJECTED DATE OF DISPLACEMENT The acquisition and relocation of the three residential properties is expected to start in Fall, 2005. ESTIMATED COST AND FUNDING FOR RELOCATION The estimated cost for relocation of the previously referenced number of residential occupants is as follows: Estimated cost of Relocation: $65,000 - $200,000 Source of Funds: Community Development Block Grant, HOME Investment Partnership '< 'òAK~>;, o {~ >- - r-U m ,- ¡.." c). C) OfiiG!NAL --"-.,. ..---..---.-"---".,.---- ~-._._.". ---_._'--+.__..--_._.__...._-~.,_.._.".._..._--- RESIDENTIAL RELOCATION NEEDS AND CHARACTERISTICS The proposed project will affect 5 residential units: One triplex which is tenant-occupied, one house which is tenant-occupied (tenant is moving out September 1, 2005 due to a recent home purchase not project related), and one owner-occupied unit. Through a preliminary survey and personal contact, the following characteristics and needs of the residents have been established: There are approximately 4 families or family groups which will be displaced. · .1..- households reported an income of $5,000 or less; · L households reported an income of $5,000 to $10,000; e .1..- households reported an income of $10.000 to $15,000; · _ households reported an income of $15,000 to $20,000; e _ households reported an income of $20,000 to $25,000; and · _ households reported an income over $25,000. ANALYSIS OF RELOCATION RESOURCES An apartment market survey of metropolitan Bakersfield was conducted by Kem Appraisal Company as of April 1, 2005. The survey contained 7,672 apartment units or approximately 19%. of an estimated 40,000 apartment units in Bakersfield. The April 1. 2005 citywide vacancy of 4.0% is a half percent increase from the October 2004 survey of 3.5 %. Over the last five years, historical vacancy peaked at 5.9% in April of 2001, and then declined to 3.1 %, its lowest point, in April of 2002. Citywide vacancy has been under 5% for more than three years. Most managers indicated traffic slowed during the winter, which is typical, but has increased with the arrival of the spring months. The results of the survey, divided into the eight major submarkets in the metropolitan area, exhibit the following results: APARTMENT MARKET VACANCY SURVEY Metropolitan Bakersfield Total Units Number of Physical Surveyed Vacant Units Vacancy Rate Southwest 2,780 104 3.7% Far Southwest 1,666 63 3.8% South 786 37 4.7% Central 301 28 9.3% North 392 11 2.8% Northeast 967 41 4.2% East 0 0 0% Northwest 780 21 2.7% Metropolitan Bakersfield 7,672 305 4% Source: Kern Appraisal Company - April 1, 2005 Since October of 2004, physical vacancy increased from 2.8 to 3.7% in the Southwest, from 3.3 to 4.7% in the South, from 3.1 to 9.3% in the Central, and 3.7 to 4.2% in the Northeast submarket, while the Far Southwest declined from 3.7 to 2.8%, the North from 3.9 to 2.8%, and the Northwest from 4.2 to 2.7%. The Central submarket, reporting the highest vacancy of 9.3% includes one complex in renovation. But, when excluding that complex, the submarket vacancy is still the highest at 5.4%. The Northwest reported the ",loKI> lowest vacancy of 2.7%. There were no reports from the East submarket. ~ .;~~ >- ¡-P \-- i-~ -0 () ORiGiNAL 2 Promotional Vacancy 0-6.9% 0-8.9% 0-4.3% 0-7.2% 0-16.9% 0-5.2% 0% 0-10.5% 0-16.9% Rental Rate Range $430-1,175 $500-1,376 $470-825 $355-795 $400-965 $475-995 N/A $695-1,650 $355-1,650 The rental range is based upon month to month rent levels. Promotional vacancy consists of concessions and/or promotions used to attract and/or retain tenants, including a reduction from month to month rent for a six month and/or one year lease. This is most often used in the higher rent level apartment complexes. Of the complexes in the April 2005 survey, 17% offered a promotion, an increase from October 2004 of only 5%. Promotional vacancy typically increases in use when vacancy levels increase. As vacancy trended upward over the winter months, use of promotions increased. The vacancy and rental rates by submarket for two bedroom units are outlined as follows: lWO BEDROOM UNITS Metropolitan Bakersfield Total Units Number of Surveyed Vacant Units Southwest 1,363 52 Far Southwest 995 36 South 319 20 Central 112 7 North 314 10 Northeast 560 20 East 0 0 Northwest 406 5 Metropolitan Bakersfield 4,069 150 Source: Kern Appraisal Company - April 1, 2005 Physical Vacancy Rate 3.8% 3.6% 6.3% 6.3% 3.2% 3.6% 0% 1.2% 3.7% Rèntal Rate Range $500-1 020 $500-1,376 $450-675 $390-675 $425-965 $518-895 N/A $825-1,518 $390-1,518 Condos and houses were selling for $220,000 in the first quarter of this year. According to property appraiser Gary Crabtree, who regularly surveys the market, about half of the buyers are investors from outside the Bakersfield area. Crabtree said, is that the average sales price of a single-family home in Bakersfield was $275,237 in May, and the average list price of 91 0 homes on the market last week was $387,911. Through this HUD (Department of Housing and Urban Development) program, FHA insures mortgages made by qualified lenders to people purchasing or refinancing a home of their own. FHA's mortgage insurance programs help low- and moderate- income families become homeowners by lowering some of the costs of their mortgage loans. FHA mortgage insurance also encourages lenders to make loans to otherwise creditworthy borrowers and projects that might not be able to meet conventional underwriting requirements, by protecting the lender against loan default on mortgages for properties that meet certain minimum requirements··including manufactured homes, single-family and multifamily properties, and some health-related facilities. In Bakersfield FHA mortgage maximums as of Friday, August 26, 2005 for a one-family house were $228,800. Staff has found several comparable one-family homes for sale in the area. These are priced at $180,000 and $205,000. At the time of actual displacement, the City and Agency will engage in an exhaustive effort to find as many referrals as needed to properly place residents. Housing referred by staff will have been inspected to ensure housing standards are met prior to referral. 3 ..- .-.........--.,.-.-"..-----.-.--.,-.. -_.._-_.---_._----~--_. <. 'òM~A> 0'" '~ -~ ,::". f!: .J (0 Of,i'31~!1>! Payment Amounts Eligible families and individuals will be given the option to claim: a) The applicable fixed relocation payment amounts are based upon the number of rooms occupied. Multiple occupants living together and displaced from a single dwelling shall be regarded as one person in calculating these payments; or Compensation for the actual reasonable expenses incurred in moving the displaced person and/or personal property including eligible storage cost if necessary. No dollar maximum has been established for compensation on actual moving expenses. b) Replacement Housing Payment for Homeowners is available in amounts up to $22,500 (or more see Last Resort Housing Payment) to a homeowner who opts to purchase a replacement dwelling within one year from the date of displacement from the acquired property and meets the 180-day occupancy requirement prior to the initiation of negotiation. If assistance is not sufficient to buy a replacement dwelling or rent a replacement dwelling unit, the Agency may provide additional purchase assistance or rental assistance. The amount payable is the difference between the acquisition price the Developers or the City paid for the acquired dwelling and the purchase price paid for the replacement dwelling which can include increased interest cost and incidental expenses to purchase. City and Agency acknowledge that some dwelling units were purchased by the homeowners prior to the enactment of Proposition 13, and as a result the property tax levied on such properties is favorable to the homeowner. City and Agency also acknowledge that if such homeowners purchase replacement dwelling units within one year Df the date of displacement, the property taxes levied on the replacement unit may not be as favorable. There are programs available under which a homeowner will not incur a financial hardship as a result of the purchase. In the event a homeowner is not eligible for such programs, City and Agency agree that homeowners will be entitled to a relocation cost which is equivalent to ten (10) years of the difference between the total yearty property tax liability (including assessments, but not fees such as trash, water and sewer) on the displaced home and the total yearty property tax liability (including assessments, but not fees such as trash, water and sewer) on the replacement dwelling unit. No federal monies will be used to pay this property tax differential. c) Replacement Housing Payment for Tenants and Certain Others is available in amounts up to $5,250 (or mDre see Last Resort Housing Payment) to displaced persons who occupy the acquired property 90 days prior to the initiation of negotiations and occupy the replacement dwelling within one year from displacement. If assistance is not sufficient to buy a replacement dwelling or rent a replacement dwelling unit, the Agency may provide additional purchase assistance or rental assistance. They may elect to receive payment for either: 4 . Ùf\r\~l>, , "1 C ó' ;,.. ~ t-. m -::) r- L> 0 'lRIG!NAL 1 ) A Rental Assistance Payment is an amount necessary to lease or rent a comparable replacement dwelling. The payment is computed on the difference between the rent paid for the comparable replacement dwelling and the rent paid at the acquired dwelling and projected over a 42 month period up to a maximum of $5,250. A homeowner who opts to rent a replacement dwelling must meet the 90- day occupancy prior to the initiation of negotiation. 2) Down payment Assistance Payment is available to assist a displaced person with a down payment on the purchase of a comparable replacement dwelling (including incidental expenses). d) Last Resort Housing Payment - All affected residential displacees will be accommodated with replacement housing payments as appropriate. No displaced person shall be required to move from his ¡her dwelling because of the City's and Agency's action unless comparable affordable housing is available. The City and Agency will make Last Resort Housing Payments whenever the City and Agency determines that a replacement housing payment would not be sufficient to provide the displaced person with an affordable comparable dwelling. If assistance is not sufficient to buy a replacement dwelling or rent a replacement dwelling unit, the Agency may provide additional purchase assistance or rental assistance. For a displaced person who is not eligible to receive a replacement housing payment because of the person's failure to meet length-of-occupancy requirements, comparable replacement rental housing is considered to be within the person's financial means. This is only if the Agency pays that portion of the monthly housing costs of a replacement dwelling which exceeds 30 percent of such person's gross monthly household income or, if receiving a welfare assistance payment from a program that designates amounts for shelter and utilities, the total of the amounts designated for shelter and utilities. e) Section 104(d) - Displaced residential tenants meeting the income and other eligibility requirements of Section 104(d) of the Housing and Community Development Act of 1974, the appropriate replacement housing payments shall be made. Section 104 would only apply if housing demolished or low income dwellings are converted to non-low moderate or non housing use. Pursuant to Public Law 105·117, aliens not lawfully present in the United States are not eligible for relocation assistance, unless such ineligibility would result in exceptional hardship to a qualifying spouse, parent, or child. All persons seeking relocation assistance will be required to certify that they are a United States citizen or national, or an alien lawfully present in the United States. 5 ·o.AK<' "v ".j> () <P >- ~ ¡- IT! Õ r- ('Dr!,~rA!C;)