HomeMy WebLinkAbout02 MID-TERM REPORT & PUBLIC HEARING FOR THE MCAS TUSTIN REDEVELOPMENT PROJECT AREAAgenda Item ~
Reviewed:
AGENDA REPORT City Manager
Finance Director N A
MEETING DATE: AUGUST 2, 2011
TO: WILLIAM A. HUSTON, INTERIM RDA EXECUTIVE DIRECTOR AND INTERIM
CITY MANAGER
FROM: REDEVELOPMENT AGENCY STAFF
SUBJECT: MID-TERM REPORT AND PUBLIC HEARING FOR THE MCAS TUSTIN
REDEVELOPMENT PROJECT AREA 2ND FIVE YEAR IMPLEMENTATION
PLAN
SUMMARY
California Health & Safety Code Section 33000 et. seq. (California Community
Redevelopment Law, the "CRL") requires a redevelopment agency to conduct a public
hearing at least once during the five year term of any redevelopment agency Five Year
Implementation Plan to review progress in meeting goals and objectives. This Mid-
Term Report discusses the 2"d Five Year Implementation Plan for the MCAS Tustin
Redevelopment Project.
RECOMMENDATION
It is recommended at a Joint Meeting of the Tustin Community Redevelopment Agency
("Redevelopment Agency") and City Council that:
The Agency:
a. Open a Public Hearing and request a presentation from staff on the Agency's
Mid-Term Report of, and Modification to, the 2nd Five Year Implementation Plan
for the MCAS Tustin Redevelopment Project Area.
b. Receive public testimony.
c. Close hearing.
d. By minute action, receive and file a copy of the Agency's Mid-Term Report on the
2nd Five-Year Implementation Plan for the MCAS Tustin Redevelopment Project
Area.
2. The City Council by minute action receive and file a copy of the Agency's Mid-Term
Report for 2nd Five Year Implementation Plan for the MCAS Tustin Redevelopment
Project Area.
Agenda Report -Mid Term Report
August 2, 2011
Page 2
FISCAL IMPACT
No direct fiscal impact associated with the approval of the Mid-Term Report, except for
staff time and costs associated with its preparation.
BACKGROUND/DISCUSSION
On August 5, 2008, the Redevelopment Agency and City Council adopted the 2nd Five
Year Implementation Plan for the MCAS Tustin Redevelopment Project Area for Fiscal
Years 2008-2009 to 2012-2013 (RDA Resolution 08-04 and City Council Resolution 08-
53). The Implementation Plan set forth the Agency's specific goals and objectives for
non-housing and housing activities in the Project Area including anticipated programs,
projects and expenditures that would eliminate blight in the redevelopment project area.
The housing activities were directed towards increasing, improving and preserving the
community's supply of low and moderate-income housing.
While identification of specific programs including projects and estimates of
expenditures is required under CRL, the Implementation Plan should be viewed as a
policy and program document. The intent was not to restrict the Agency's activities
since the conditions, expectations, resources, and needs of the Project Area can
change over time. Rather, the 2"d Five Year Implementation Plan outlined the
expectations of the Agency for the five years between FY 2008/09 and FY 2012/13.
CRL requires that the Redevelopment Agency conduct a public hearing to review and
hear public testimony from all interested parties at least once during the five-year period
of the 2"d Five Year Implementation Plan. To comply with this requirement, staff has
undertaken a review of the 2"d Five Year Implementation Plan and has evaluated the
Agency's progress toward implementing the redevelopment activities and the affordable
housing activities.
The Redevelopment Agency public hearing was duly noticed pursuant to the
requirements of Section 6063 of the Government Code as required by Section 33490(d)
of the Health and Safety Code.
A full copy of the Mid-Term Report documenting the Redevelopment Agency's progress
and modifications to the 2nd Five Year Implementation Plan for the MCAS Tustin
Redevelopment Plan is attached. Similar to the adopted 2"d Five Year Implementation
Plan, the attached Mid-Term Report is broken into two sections: 1) non-housing
activities and 2) affordable housing activities. What follows is a brief summary of
progress to date.
Agenda Report -Mid Term Report
August 2, 2011
Page 3
ACTIVITIES, PROGRAMS AND PROJECTS
Non-Housing
Non-Housing activities have focused on the elimination of blighting conditions through
development, community facilities, environmental remediation, public infrastructure and
street improvement programs. Since the adoption of the 2nd Five Year Implementation
Plan, a severe national recession significantly impacted implementation activities,
directly and indirectly, including those public and private financial resources necessary
for the implementation of activities and programs that were outlined in that
Implementation Plan. Despite this economic downturn, the Redevelopment Agency has
continued in its progress toward the elimination of blighting conditions through programs
and projects completed since the adoption of the 2" Five Year Implementation Plan in
2008, as further detailed in the Mid-Term Report. Highlights of these non-housing
programs and projects are as follows:
• Certificates of Compliance were issued for the Tustin Field I and II projects. Both
projects were completed in compliance with the Disposition and Development
Agreements (DDAs) fora 376 residential unit and 189 residential unit developments.
• Coordination of implementation activities associated with three Community Facilities
Districts (CFD) totaling approximately $78 million.
• Coordination of implementation activities associated with the issuance of MCAS
Tustin Tax Allocation Bonds providing approximately $40 million in net proceeds that
will be utilized for Tustin Legacy Backbone Infrastructure construction, with the
priority being construction of the Tustin Ranch Road extension.
• Completion of a Tustin Legacy Disposition Strategy for the Former Master Developer
Footprint, which reframes the City's approach to marketing and developing the
remaining City-owned Tustin Legacy property.
• Continued oversight of property maintenance and security responsibilities on 850
acres of City-owned property until the property becomes fully developed.
• Continued assistance with design, construction, right-of-way acquisition,
environmental coordination of infrastructure projects at Tustin Legacy, as applicable,
such as:
o Tustin Ranch Road and Edinger Bridge Project
Agenda Report -Mid Term Report
August 2, 2011
Page 4
o Valencia Avenue extension from Kensington Drive to Tustin Ranch Road
o Extension of Park Avenue north to Legacy Road
o Legacy Road from Tustin Ranch Road east to Park Avenue
o Valencia Avenue/Armstrong Roadway Project
o The District at Tustin Legacy Infrastructure Projects
o Phase I Newport Avenue Extension/Northbound SR 55 Ramp
Reconfiguration/Edinger Avenue Widening
o Warner Avenue design from Red Hill Avenue to Armstrong Avenue
o Armstrong Avenue design from Warner to Barranca Parkway
o Park Avenue design from Tustin Ranch Road to Armstrong
o Tustin Legacy Community Park (24 acres)
o Tustin Legacy Regional Park (84 acres)
o New Fire Station 37 Facility at Kensington Drive and Edinger Avenue
Continued coordination with the Department of the Navy, state and federal agencies
regarding the Navy's ongoing environmental remediation activities to bring the sites
into a useable condition.
Housing
The 2"d Five Year Implementation Plan described how specific goals, objectives and
proposed projects, programs and expenditures would be implemented in addressing the
low and moderate income housing requirements mandated by law. The following items
are highlights of the status of housing implementations activities.
• The Implementation Plan anticipated that 322 affordable ownership units would be
created during its five year term largely as a result of development of some of the
affordable ownership units at Columbus Square in Coventry Court and in Phase 1 of
the former master development footprint. The 322 units were to be distributed as
follows: 40 units for very low income households, 116 units for low income
households, and 166 units for moderate income households. With the termination of
the former master developer agreement in 2010 due to non-performance, there will
be delays in achieving the total number of units anticipated originally in the 2"d Five
Year Implementation Plan.
• Subsidizing affordable ownership units is extremely costly, thus the Agency has
begun exploring a less costly rental option to meet the affordable housing goals. The
Tustin City Council also approved 153 affordable apartment units at Coventry Court,
Agenda Report -Mid Term Report
August 2, 2011
Page 5
a senior housing development in the Villages of Columbus, as a substitute for what
was originally planned as an ownership project. Construction of 153 affordable
apartment units has commenced and completion and occupancy of the project is
anticipated before the end of the 2nd Five Year Implementation Plan. It is
anticipated that at least 50 affordable units may be under construction before the
close of the term of the 2"d Five Year Implementation Plan on other locations at
Tustin Legacy.
• No direct Agency funding was provided for the affordable units in the Villages of
Columbus. The affordable units were developed because the City provided a
density bonus, including variances of certain development standards which was
considered a financial incentive by the developer. The last of the newly constructed
ownership units in the Villages of Columbus were completed during the term of the
2"d Five Year Implementation Plan.
• The 2"d Five Year Implementation Plan anticipated that 253 new affordable rental
units would be constructed, including 126 units for very low income households, 64
units for low income households and 63 units for moderate income. These units
were anticipated in the original TLCP master plan. While we are unable to anticipate
when construction of all 253 units will be completed, we estimate that construction of
211 affordable apartment units may likely be initiated prior to the end of the Five
Year Implementation Plan time period.
• During the term of the 2"d Implementation Plan, the Agency has continued to review
and approve re-sales of affordable units, review and approve refinancing of
affordable units and monitor all affordable units on an annual basis for compliance
with the affordable covenants associated with each property. The units currently
being monitored are in Tustin Field I, Tustin Field II, Columbus Square and
Columbus Grove.
• The City has allocated $60,000 in CDBG funds to continue its financial support of
homeless assistance and supportive services in the City. The City's goal for this
program is to assist 200 homeless individuals per year during the 2nd Five Year
Implementation Plan. It is estimated that 1,413 people have been assisted since
July 1, 2008.
RECENT LEGISLATION AFFECTING REDEVELOPMENT
Modifications and impacts to this 2"d Five Year Implementation Plan will be negatively
impacted by recent state legislation associated with the adoption of the state's budget
including Trailer Bills A61X 26 ("Dissolution Bill") and AB1X 27 ("Voluntary Program
Bill") which were signed into law by Governor Brown on June 29, 2011. Below is a brief
Agenda Report -Mid Term Report
August 2, 2011
Page 6
summary that indicates the impact of these bills on the Agency's 2"d Five Year
Implementation Plan.
• AB1X 26 ("Dissolution Bill") will dissolve Redevelopment Agencies ("RDA's")
effective October 1, 2011. Until that time, RDA's are prohibited from taking any new
actions other than payment of existing indebtedness and performance of existing
contractual obligations.
• AB1X 27 ("Voluntary Program Bill") provides that, notwithstanding the Dissolution
Bill, any RDA may avoid dissolution by opting into a Voluntary Program permitting it
to continue to operate and function if the City has adopted an opt-in ordinance by
November 1, 2011, which would commit the Agency to making specified substantial
annual payments into a Special District Allocation Fund ("SDAF") and Educational
Revenue Augmentation Fund ("ERAF") established for each county and
administered by the County Auditor-Controller largely to benefit local school and
special districts.
On July 18, the California Redevelopment Association (CRA) filed a petition asking the
California Supreme Court to overturn the Dissolution Bill (AB1X 26) and the Voluntary
Program Bill (AB1X 27) because they violate the state's constitution. An immediate stay
of these bills will preserve the status quo pending a decision on the constitutionality of
these laws. Concurrently, CRA requested that the Court issue a stay to prevent the
legislation from going into effect until the Court renders its decision.
Until the validity of the Dissolution Bill and Voluntary Program Bill are determined, the
City has adopted Urgency Ordinance 1404 and introduced permanent Ordinance 1405
agreeing to comply with the Voluntary Program Bill. Failure of the City to adopt a
Voluntary Program Ordinance would have resulted in the termination of the Tustin
Community Redevelopment Agency (RDA) activities, requiring the turnover of Agency
financial and property assets (including real estate assets) to a successor agency and
preclusion of the RDA from proceeding with critical City priorities, including construction
of Tustin Ranch Road. This would have been detrimental to the health, safety and
economic well-being of residents of the City and caused irreparable harm to the
community, because, among other reasons, the redevelopment activities and projects
made possible, implemented, and funded by the RDA are highly significant and of
enduring benefit to the community and City, and are a critical component of its future.
The adoption of Ordinances 1404 and 1405 requires the City, utilizing redevelopment
tax increment, to make a required payment. The current payment estimates for Tustin
provided by CRA for Tustin indicated that an approximate $7.1 million payment will be
required for Fiscal Year 2011-2012 and approximately $1.7 million for Fiscal Year
Agenda Report -Mid Term Report
August 2, 2011
Page 7
2012-13 and thereafter. Staff believes that the preliminary estimates are not correct and
that we may need to appeal to the state Department of Finance (DoF) as the RDA has
incurred more than a ten percent increase in bonded indebtedness since Fiscal Year
2008-09. If the appeal is successful, it will significantly lower any estimated Tustin
Voluntary Program payment.
Staff will be available to answer any questions the Agency may have regarding the
attached report.
~~L =GG ~~o~yc~- C
Christine A. Shingleton
Assistant City Manager
Jerry C
Mana~
Jo n Buchanan, RDA Program
anager ~-
ram
Attachments: Mid-Term Report and Modification to 2'~ Five Year Implementation Plan for MCAS Tustin
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MID-TERM REPORT AND MODIFICATION TO THE
2ND FIVE YEAR IMPLEMENTATION PLAN FOR THE
MCAS TUSTIN REDEVELOPMENT PROJECT AREA
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Tustin Legacy
TABLE OF CONTENTS
MID-TERM REPORT AND MODIFICATION to 2"D IMPLEMENTATION PLAN for MCAS TUSTIN
SECTION I -INTRODUCTION .............................................................................................. ............ 2
SECTION II -NON-HOUSING ACTIVITIES
11.1 Background .................................................................................................... ............ 6
11.1.1 Recent Legislation Affecting Redevelopment ................................. ............ 6
11.1.2 Financial Resources/Non-Housing Resources ................................. ............ 8
11.2 Activities and Programs ................................................................................. ............ 8
11.2.1 Acquisition, Disposition, and Development .................................... ............ 8
11.2.2 Public Improvements & Facilities ................................................... ............ 12
11.2.3 Demolition/Site Clearance .............................................................. ............ 14
11.2.4 Economic Development Programs ................................................. ............ 14
11.2.5 Environmental Remediation ........................................................... ............ 14
11.2.6 Administrative Program Support and Indirect Costs ...................... ............ 16
11.2.7 Addressing Blighting Conditions through Non-Housing Activities .. ............ 16
SECTION III -HOUSING ACTIVITIES
111.1 Introduction ................................................................................................... ........... 21
111.2 Background .................................................................................................... ........... 21
111.3 Recent Legislation Affecting Housing Activities ............................................. ........... 23
111.4 The Low and Moderate Income Housing Funds Available ............................. ........... 23
111.5 Housing Programs, Projects and Expenditures .............................................. ........... 24
111.6 Proportional Expenditure of Housing Funds .................................................. ........... 26
111.7 Affordable Housing Compliance Plan ............................................................ ........... 27
111.8 Replacement Housing Obligations
29
111.9 Addressing Blighting Conditions through Housing Activities .................................... 29
Section I
Mid-Term Report - 2~d Five-Year Implementation Plan
MCAS Tustin
Introduction
I. INTRODUCTION
On August 5, 2008, the Tustin Community Redevelopment Agency ("Agency') adopted Resolution
RDA OS-04, approving the 2nd Five-Year Implementation Plan (Fiscal Years 2008-2009 through 2012-
2013) for the Redevelopment Plan for the MCAS Tustin Redevelopment Project Area. Prepared in
accordance with Chapter 4, Article 16.5, Section 33490 of the California Community Redevelopment
Law ("CRL"), the 2nd Five-Year Implementation Plan set forth the Agency's specific goals and
objectives for the Project Area, the anticipated programs, projects and expenditures for afive-year
period, and describes how these programs, projects, and expenditures will eliminate blight in the
Redevelopment Project Area. The Implementation Plan also summarized the Agency's housing
activities, identifying programs, projects and expenditures directed towards increasing, improving
and preserving the community's supply of low and moderate-income housing. A copy of the Second
Five-Year Implementation Plan is attached hereto as Attachment A.
Section 33490(5)(c) of the Law requires redevelopment agencies to conduct a public hearing to
review and hear testimony from all interested parties at least once during the five-year term of the
Implementation Plan. The purpose of the mid-term public hearing is to review the Redevelopment
Plan and the corresponding Implementation Plan for each redevelopment project within the
jurisdiction and to evaluate the progress of the redevelopment projects. The mid-term public
hearing must take place no earlier than two years and no later than three years following the
adoption of the Implementation Plan. The Mid-Term Report, per Section 33490(5)(c), specifically
focuses on the status and implementation of affordable housing activities by the Agency.
In the Second Five-Year Implementation Plan, the non-housing activities addressed were as follows:
• The goals and objectives of the Redevelopment Plan were revisited.
• The Agency's strategy for achieving the goals and objectives of the Redevelopment Plan were
defined.
• Anticipated programs, projects and estimated expenditures for the next five-year period
were identified (Fiscal Years 2008/2009 through 2012/2013).
• Programs, projects, and expenditures that would eliminate blight in the Project Area were
described.
In the 2nd Five-Year Implementation Plan, the Agency's housing activities were addressed as follows:
• Statutory requirements for the set-aside and expenditure of tax increment for housing
purposes were described including programs, projects and expenditures directed towards
increasing, improving, and preserving the community's supply of low and moderate-income
housing.
• The Plan identified how residential development was to be implemented in the Project Area
per the Agency's established goals and in compliance with the CRL.
2
The elimination of blight is a fundamental purpose for redevelopment under CRL and is discussed
more fully in Section II of this Mid-Term Report. The provision of affordable housing is another
fundamental purpose under CRL, and is addressed in Section III of this Mid-Term Report. While
identification of specific programs, including projects, and estimates of expenditures proposed to be
made is required under CRL, the Implementation Plan should be viewed as a policy and program
document. The intent is not to restrict the Agency's activities since the conditions, expectations,
resources, and needs of the Project may change from time to time. Rather, the Plan outlined the
expectations of the Agency for the five years between FY 2008/09 and FY 2012/13. This Mid-Term
Report by the Agency Board of Directors discusses redevelopment activities to date during the period
of the Plan and reviews progress in achieving the goals and objectives of the Plan.
The Mid-Term Report addresses and reviews the two major components of the 2nd Five-Year
Implementation Plan: the redevelopment implementation activities in MCAS Tustin Redevelopment
Project Areas and the low and moderate-income housing implementation activities inside and
outside the Project Area.
3
Table 1
Project Area Data Summary
The MCAS Tustin Redevelopment Project Area is comprised of 1,508.6 acres
Project Area Size, Location and including 1,504.5 acres that were part of the former MCAS Tustin base and 4.1 acres
Characteristics that are located outside the former base boundaries.
Redevelopment Plan Elements Date Ordinance No.
Redevelopment Plan Adopted June 16, 2003 Ord. No. 1276
Redevelopment Plan Amendment
No. 1 April 3, 2007 Ord. No. 1334
(description of Agency programs)
Redevelopment Plan Limits
July 16, 2023
• Last Date to Incur Project Area or from date of Auditor's Certification (January 21
2025)
Indebtedness' ,
July 16, 2033
• Redevelopment Plan
Expiration Date** or from date of Auditor's Certification (January 21, 2025)
• Last Date to Receive Project July 16, 2048
Area Tax Increment***
• Expiration Date for
Eminent Domain June 13, 2015
Authority****
• Total Amount of $180,000,000 would be outstanding at any one time
Permitted Bonded Debt
• Maximum Amount of Tax $833,000,000 (100%)
Increment
* The Agency shall not establish or incur loans, advances, or indebtedness to finance in whole or in part the Project beyond
20 years from the date the County of Orange Auditor makes its certification pursuant to Section 33492.9 of the CRL. Loans,
advances, or indebtedness may be repaid over a period of time beyond said time limit. This time limit shall not prevent the
Agency from incurring debt to be paid from the Low and Moderate Income Housing Fund or establishing more debt in order
to fulfill the Agency's housing obligations under Section 33413 of the CRL.
**County Auditors Certificate per Redevelopment Plan was January 21, 2005.
***Redevelopment Plan Expiration Date and Last Date to Receive Project Area Tax Increment may be extended for one year
for each year ERAF Payment is made to State pursuant to Health & Safety Code Section 33333.6 (revised per SB1045).
*'**Per Ordinance No. 1334
Section II
2na Five Year Implementation Plan
Mid-Term Report
MCAS Tustin
Non-Housing Activities
II.1 BACKGROUND
The 2nd Five-Year Implementation Plan separately addressed non-housing redevelopment
implementation activities and housing activities. This is largely because the legal requirements for
implementation plans and restrictions on the expenditure of related revenues are significantly
different for the two types of activities. This Mid-Term Report follows the same format and reviews
the housing component of the Plan separately from the other redevelopment activities of the
Agency. The Mid-Term Report focuses on legislation, expenditures, activities and programs of the
Agency that are not related to low and moderate-income housing. The housing component of the
Implementation Plan is included in a separate section of this Mid-Term Report (Section III).
II.1.1 Recent Legislation Affecting Redevelopment
AB1X 26 and AB1X 27, both trailer bills to the main state budget (Senate Bill 87), were recently
approved by the Legislature and signed by Governor Brown on June 29, 2011.
The A61X 26 (the "Dissolution Bill") will dissolve Redevelopment Agencies ("RDA's") effective
October 1, 2011. Until that time, RDA's are prohibited from taking any new actions other than
payment of existing indebtedness and performance of existing contractual obligations. Under the
Dissolution Bill on October 1st, all agency property and obligations will be transferred to successor
agencies, except for the assets of the Low and Moderate Income Housing Fund, and overseen by an
oversight board, the county auditor-controller, and the State Department of Finance (DoF). Assets in
the Low and Moderate Income Fund will be transferred to the auditor-controller for immediate
distribution to taxing agencies. Successor agencies will be charged with repaying existing RDA
indebtedness, completing performance of existing contractual obligations and otherwise winding
down operations and preserving/disposing of RDA assets for the financial benefit of taxing agencies.
The actions of successor agencies will be subject to review by a local oversight committee.
A61X 27 (the "Voluntary Program Bill") provides that, notwithstanding the Dissolution Bill, any RDA
may avoid dissolution by opting into a Voluntary Program permitting it to continue to operate and
function if the City has adopted an opt-in ordinance by November 1, 2011. The contents of the
ordinance must commit the City to making specified substantial annual payments into a Special
District Allocation Fund ("SDAF") and Educational Revenue Augmentation Fund ("ERAF") established
for each county and administered by the county auditor-controller largely to benefit local school and
special districts. If all RDA's state-wide opt into the Voluntary Program, contributions will amount
to a total of $1.7 Billion for Fiscal Year 2011-12 and appear intended to amount to $400 million in
each succeeding fiscal year. The amount of the payment for each city or county is calculated by the
DoF and will be communicated to the cities and counties no later than August 1, 2011.
On July 18, the California Redevelopment Association (CRA) filed a petition asking the California
Supreme Court to overturn the Dissolution (AB1X 26) and Voluntary Program Bills (AB1X 27) because
they violate the State's Constitution. An immediate stay of these Bills will preserve the status quo
pending a decision on the constitutionality of these laws. At the same time as the filing of the
6
petition, CRA requested that the Court issue a stay to prevent the legislation from going into effect
until the Court renders its decision.
Until the validity of the Dissolution Bill and Voluntary Program Bill are determined, the City has
adopted Urgency Ordinance 1404 and introduced permanent Ordinance 1405 agreeing to comply
with the Voluntary Program Bill. Failure of the City to adopt a Voluntary Program Ordinance would
have resulted in the termination of Tustin RDA activities, turn over of Agency financial and property
assets (including real estate assets) to a successor agency, and preclusion of the RDA from
proceeding with critical City priorities, including construction of Tustin Ranch Road. This would have
been detrimental to the health, safety and economic well-being of residents of the City and caused
irreparable harm to the community, because, among other reasons, the redevelopment activities
and projects made possible, implemented, and funded by the RDA are highly significant and of
enduring benefit to the community and City, and are a critical component of its future.
The adoption of Ordinance 1404 and/or 1405 will require the City, utilizing redevelopment tax
increment, to make a required payment. The current payment estimates for Tustin provided by CRA
for Tustin indicated that an approximate $7.1 million payment will be required for Fiscal Year 2011-
2012 and approximately $1.7 million for Fiscal Year 2012-13 and thereafter. Staff believes that the
preliminary estimates are not correct and that we may need to appeal to the DoF as the RDA has
incurred more than a ten percent increase in bonded indebtedness since Fiscal Year 2008-09. If the
appeal is successful, it will significantly lower any estimated Tustin Voluntary Program payment.
Once DoF issues its estimates to Tustin by August 151, the City can appeal any estimates by August
15th. The City's Finance Director has reviewed available RDA cash balances and anticipates having
sufficient funds available to make the required Voluntary Program payments in Fiscal Year 2011-12,
and in the near term subsequent fiscal years, although the payments will limit resources available for
completion of all anticipated RDA implementation activities in the future. The alternative posed by
the Dissolution Bill is unacceptable since it provides no resources for future RDA implementation and
has all RDA resources and assets transferred to a successor agency, largely representing local school
districts and other taxing agencies.
It is expected before the end of this session of the State Legislature, additional bills will be adopted
which have additional impact on redevelopment operations.
7
11.1.2 Financial Resources/Non-Housing Resources
The Agency's implementation activities are based on the availability of funding from existing fund
balances, bond proceeds and estimated future tax increment revenues not previously committed to
existing financial obligations. While achievement of the Implementation Plan goals and objectives,
and implementation of the programs, activities and expenditures will assist in eliminating blight
within the Project Area, private sector investment also contributes to the removal of blight.
Non-housing tax increment revenues available for project implementation undoubtedly will be
severely impacted by recent state legislation effecting redevelopment agencies throughout
California. Scheduled program activities may need to be curtailed or implemented more slowly due
to reduced resources, especially capital improvement programs and projects.
11.2 ACTIVITIES AND PROGRAMS
Non-Housing Activities within the MCAS Tustin Project Area, as outlined in the 2"d Five Year
Implementation Plan, have focused on the elimination of blighting conditions through development,
community facilities, environmental remediation, and public infrastructure/street improvement
programs.
Major redevelopment activities and projects completed in the MCAS Tustin Project Area have
reduced blight and provided for the revitalization of the Project Area. A detailed summary of the
major development projects that were completed prior to August S, 2008, is included in the Second
Five-Year Implementation Plan, which is included herein as Attachment A.
Since the adoption of the 2~d Five Year Implementation Plan in 2008, a severe national recession has
drastically impacted, direct and indirectly, both public and private financial resources necessary for
the implementation of activities and programs that were anticipated in the Plan. The impact on
these programs is discussed in this section. As discussed in Section I of this report, recent state
legislation impacting redevelopment agencies will have an additional negative on the Agency's direct
financial resources.
As identified in the Implementation Plan, Plan activities and programs often coincide and overlap
with prior implementation plans to produce successful projects. A complete description of projected
non-housing programs, activities and expenditures was included in the Plan which focused on six
major areas: 1) Acquisition, Disposition and Development Coordination; 2) Public Improvements and
Community Facilities; 3) Demolition and Site Clearance; 4) Economic Development; 5) Environmental
Remediation; and 6) Administration Program Support and Indirect Costs. These programs and
activities are discussed below with a brief update on any additional progress since beginning of the
Implementation Plan term.
11.2.1 Acquisition, Disposition and Development Coordination Program
During the initial term of the Implementation Plan, Agency staff administered acquisition, disposition
and development coordination activities of City-owned properties in the disposition and
development of parcels throughout the Tustin Legacy project. Agency staff has continued in its role
in the acquisition, disposition, and coordination of development activities with the appropriate
8
developers and City operating departments. Issues associated with the disposition of properties and
management oversight of the activities will also be performed including leasing, licensing, property
management, and site preparation. Market conditions have and will continue to impact disposition
activities over the term of the Plan. The Agency is anticipated to coordinate with the City in the
following activities:
a. Disposition and Development Agreements (DDA)
• Vestar/Kimco Tustin L.P. (The District at Tustin Legacy)
The City anticipated conveying 3.96 acres of leased property during the term of the Plan;
however, conveyance is conditioned upon the Navy's remediating specific environmental
conditions impacting the site. The Navy's remediation activities will not make these
properties ready for conveyance until 2013-2014; the Navy had previously anticipated
conveyance in 2010-2011. The Agency is responsible for all development coordination
activities associated with the terms and conditions of the DDA requiring a Certificate of
Compliance. A Fifth Amendment to the DDA was executed in October 2010 that delayed the
completion of adjacent infrastructure by the developer until the earlier of grading permits
being issued on property adjacent to The District, but in any event no later June 2015. We
can expect that the Tustin Ranch Road grading permits will trigger the requirement for
construction to begin earlier, rather than later, on the required remaining infrastructure
improvements.
The Agency is also working with Vestar and the Army on a potential land exchange that will
reduce some of the parking issues for Vestar. This transaction is expected to occur before
the end of the year.
^ Agreement with TLCP, LLC Terminated (3`d Qtr, 2010)
The City of Tustin in 2010 terminated its DDA with Tustin Legacy Community Partners, LLC
(TCLP) for development of 820 acres at Tustin Legacy. The termination followed the
developer's non-performance under the DDA, including the construction of required critical
infrastructure. A downturn in the national, state and local economy was most severely felt in
the real estate industry where investment and lending activity was significantly curtailed for
residential and commercial development. The City worked diligently to assist the developer
in meeting its obligations under the terms and conditions of the DDA. The City offered
extensions to the developer's performance schedule, modifications to the location and
timing of development, and timing and phasing of infrastructure and extensions to the land
conveyance schedule. Unfortunately, the developer was unable to perform or agree to a
plan that would prevent risk to the City and taxpayers.
^ WL Homes, dba John Laing Homes (1S` Qtr, 2010)
In the 1s1 Quarter of 2010 a Certificate of Compliance was issued for Tustin Field I and Tustin
Field II stating that both projects were completed in compliance with the DDAs for both sites.
Tustin Field I is 29.4 acres, comprised of 376 residential units, 78 of which are affordable
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units. Tustin Field II is 36.8 acres, comprised of 189 residential units, 40 of which are
affordable units.
b. Community Facilities District Financing and Related Assessment Financing
The Agency staff has coordinated with City departments, including the City's Finance
Department, in seeking Community Facility District (CFD) financing and related assessment
district financing as appropriate for new development within the Project Area. During the term
of the 2"d Five-Year Implementation Plan, the Agency participated in coordinating
implementation activities associated with the three CFD's totaling approximately $78M (CFD 04-
01 $11,415,000; CFD 06-01 $53,570,000; CFD 07-01 $13,680,000). In November 2010, the
Agency participated in Special Tax Bond financing for an Amendment to CFD 06-01 in the amount
of $1,675,0000 for Columbus Villages, a residential neighborhood located within the Project
Area.
The Agency also issued MCAS Tustin Tax Allocation Bonds providing approximately $40 million in
net proceeds to be utilized for Tustin Legacy Backbone Infrastructure construction, with the
priority project being the construction of the extension of Tustin Ranch Road.
c. Development Coordination in Project Area
The Agency staff has been responsible for overall development coordination within the Project
Area and the Tustin Legacy project. This development coordination role includes all sites and
parcels with Tustin Legacy.
d. Tustin Legacy Disposition Strategy for 820 acres (April 2011)
With the termination of the agreement with TLCP, the City and the Agency took the opportunity
to rethink the manner and method in which the property was to be marketed and developed. In
April 2011, the Tustin City Council approved the Tustin Legacy Disposition Strategy, an
implementation strategy to reframe the City's approach to marketing and developing the
remaining property owned by the City. With approval of this strategy, the City will subdivide the
property into disposition packages that are to be sold and developed by private sector
developers for the land uses designated in the plan. Developers will be required to install
infrastructure not only adjacent to their site, but also pay for a portion of the major
infrastructure systems. The City Council approved the strategy as the best framework for moving
forward with Tustin Legacy while continuing to remain focused on the Project's original vision.
During the second half of 2011, developer interest will be solicited on four sites adjacent to
Tustin Ranch Road, near The District retail center. The developer selection process identified in
the Disposition Strategy will be used to assist the City in determining the most qualified
developers.
e. Solicitation of Development Interest in City-owned Site for 18.5 acres
The City has entered into a Term Sheet with the South Orange County Community College
District that could result in a possible land exchange with the District for property they own,
impacting the schedule and implementation of any marketing of the City owned property. If an
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agreement can be reached, and depending on market conditions during the term of this Plan, the
Agency will solicit interest in the development of City-owned sites located in the western portion
of the Project Area. In addition to soliciting interest, the Agency will be responsible for all
development coordination activities associated with the sites. The current property is bounded
by Red Hill Avenue on the west, Valencia Avenue on the north, Warner Avenue on the south, and
the SOCCCD property on the east. The proposed land exchange could relocate the site with its
primary orientation along Warner Avenue. The schedule for solicitation and disposition will take
into consideration the proposed land exchange and future market conditions when in the City's
best interest.
f. Interim Leasing and Licensing
The Agency has continued to administer the leasing and licensing of City-owned properties in the
Tustin Legacy project. Licensing of City-owned properties will be done on an interim basis to
address temporary needs related to the development of Tustin Legacy.
g. Property Management
The Agency will continue to perform oversight of property maintenance and security
responsibilities on 850 acres of City-owned property until the properties are fully developed, this
includes 805 acres located within the Master Development Footprint and 46 acres outside the
Master Development Footprint. Specifically, property management and security responsibilities
will continue to include:
• Overseeing the property management contract with So Cal Sandbags, Inc., for erosion
control and weed abatement within the Master Development Footprint, and the landscaping
contract with Spectrum Care Landscape and Irrigation Management, Inc., for Tustin Legacy
properties that are outside of the Master Development Footprint.
• Overseeing security-related activities, including the Master Development Footprint and
additional 46 acres, as needed, coordination with City staff, the Navy, regulatory agencies,
developers, contractors, the public, and other tenants at Tustin Legacy. The Agency will also
continue to work with the City to ensure remaining buildings (including the southern hangar)
and site perimeters are secure, including repairing fence and building openings, as needed,
and to work closely with Tustin Police Department, including site visits and meetings as
needed, to ensure security needs are met.
h. Vestar/Kimco Tustin Parcel: 3.96 acres are currently located in a LIFOC area. This is part of their
total development site (87 net developable acres). The acreage is developed but leased currently
to Vestar/Kimco. The time frame for Navy conveyance to the City of the remaining acreage is by
2014/15 and then the property will be subsequently conveyed by the City to Vestar.
i. Continue to Assist with Public Benefit Process with the County
The Agency will continue to assist the City in coordinating the Public Benefit Process with the
County of Orange for the 10 acre Sheriff's Training Facility site and the 84 acre Regional Park site.
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j. Acquisition of Parcels currently Leased from Navy
The Agency will continue to assist the City in the acquisition of leased parcels, also known as
LIFOC (Lease in Furtherance of Conveyance) parcels, from the Navy as part of the Economic
Development Conveyance to the City. Some of these parcels will be retained by the City for
community facilities or infrastructure, while other LIFOC parcels will be conveyed to
Vestar/Kimco under the terms and conditions of the existing DDA, as previously noted. On all
parcels, the Agency and City operating departments spend considerable time and effort, with the
Agency being responsible for significant planning and coordination efforts on the City-owned
sites and those sites that will be conveyed to other public agencies or private development.
Disposal parcels yet to be conveyed are as follows:
• City Parcels: It is anticipated in late 2012 that the Navy will convey to the City both, 1) a 24
acre community park; and 2) a 2.4 acre site containing a former child care center. The
Agency is actively coordinating the design and planning for development coordination on
these sites.
• Master Development Footprint: 1) a 32.2 acre site (current location of southern hangar),
known as Carve-Out Area 6, with a designated non-residential land use is anticipated for
conveyance to the City in 2012; 2) 39.33 acres (located generally to the south and east of the
northern hangar), known as a portion of Carve-Out Area 5, is anticipated for conveyance in
2014/15; and, 3) a 2.17 acre site (located north of Warner Avenue across from The District at
Tustin Legacy), known as Carve-Out Area 9, is anticipated for conveyance in 2014/15. The
Agency is responsible for development coordination of these sites.
• SOCCCD Parcels: Approximately 31 acres are currently located in LIFOC area; the parcels are
sub-leased from the City to the South Orange County Community College District (SOCCCD)
and are anticipated for conveyance by the Navy to the City in late 2012; the property will be
subsequently conveyed by the City to SOCCCCD. These sub-leased parcels are part of a larger
site of 68 acres; 37 acres has been conveyed. The conveyance is subject to SOCCCD
complying with the terms and conditions of the Conveyance Agreement, compliance with the
Specific Plan and Redevelopment Project Area Plan.
11.2.2 Public Improvements & Facilities
The Agency has participated and coordinated financing, planning, design, and construction of public
infrastructure improvements and community facilities. The projects listed below were originally
proposed in the 2"d Five-Year Implementation Plan and some changes to the proposed projects have
occurred. These changes were the result of one or more of the following: market conditions; site
conditions discovered during facility planning; identified community needs; and, the need to
eliminate immediate blight conditions.
In 2008, the Agency identified an estimated $407M of public backbone infrastructure needs known
as the Tustin Legacy Backbone Infrastructure Program, within the Project Area or of benefit to the
Project Area. These improvements include roadways, bridges, traffic signals, traffic mitigation
(FEIS/EIR), drainage improvements, water quality improvements, dry utilities, public parks, and
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community facilities. The Implementation Plan contained a comprehensive listing of infrastructure
projects. The projects discussed below are the most important projects.
• Tustin Ranch Road and Bridge Project - In October 2010, the Agency issued $44,170,000 in
MCAS-Tustin Project Area tax allocation bonds for the purpose of constructing infrastructure
within the Project Area and immediately adjacent to the Project Area. The majority of the bond
proceeds will be used for the construction of the Tustin Ranch Road project with any remaining
funds allocated to other infrastructure improvements. The Agency is continuing to assist in the
design, construction, and acquisition of right-of-way associated with the extension of Tustin
Ranch Road from Walnut Avenue to Warner Avenue. Construction of the road and bridge
project is scheduled to commence in Summer 2011.
• Valencia/Armstrong Roadway Project -Continuing to assist in completing the design of the two
remaining portions located in the southwest portion of the Project Area (Armstrong Avenue -
Barranca to Warner), and the northeast portion (Valencia Avenue -Kensington to Moffett).
Construction of these roadways will open parcels for the development of residential and
commercial uses. Armstrong is a major north/south arterial and Valencia is a major east/west
arterial. The continuation of Valencia to Tustin Ranch Road is expected to commence in 2011.
• The District at Tustin Legacy Infrastructure Project -Continuing to assist Vestar in the design
and their construction of the remaining portions of required new infrastructure and the
expansion of existing systems including roadways, storm drains, and utilities, including
infrastructure in Warner Avenue and Barranca Parkway. This infrastructure will serve the new
regional retail center, The District at Tustin Legacy, and the western portion of the Project Area.
Phase I Newport Avenue Extension/Northbound SR55 Ramp Reconfiguration /Edinger Avenue
Widening Project Improvements (referred to as Phase I and Phase II Newport Avenue) -
Although this project is in the South Central Project Area, it is of benefit to the MCAS Tustin
Project Area because of traffic generation resulting from development within the MCAS Tustin
Redevelopment Project Area. RDA Resolution No. 07-01, finding benefit to the Project Area was
adopted by the Agency in 2007. Phase I has been completed and Phase II, which is the extension
of the roadway north of Edinger to Sycamore Avenue, has not been fully funded and will be
dependent upon future available funding.
• Tustin Legacy Community Park (24 acres) - Continuing to coordinate planning, design,
environmental assessment of existing contamination plumes with Navy clean-up efforts, and
construction of a community park to be owned and operated by the City of Tustin. The Agency
completed the environmental assessment of the building located on the site and completed
demolition and removal of the buildings in 2009. Geotechnical borings of the site will be
completed in Summer 2011 and will be followed by completion of the Master Plan for the park
and commencement of final design of phased park improvements (phasing will be required due
to environmental remediation activities occurring on the site).
• Tustin Legacy Park (84 acres) -Continuing to assist the County in the planning, programming,
design, and construction of public athletic facilities, recreation facilities, open space areas, and
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trails, bicycle paths, and walkways. The County expects to bring a potential conceptual program
forward in late Fall of 2012 and make any subsequent decisions necessary as to the feasibility
and funding of the park.
• Fire Station (8,500 sq. ft. building on 1.25 acres) -Planning and design will be completed in
Summer 2011. The construction of the fire station will be bid in late 2011 with construction to
commence in December 2011 or January 2012. The construction of the fire station should be
completed for occupancy in early 2013 with the opening corresponding to the opening of the
Tustin Ranch Road Project. The fire station facilities and land will be owned by the City and
leased to the Orange County Fire Authority (OCFA). Agency staff is preparing a lease agreement
with OCFA for the facilities. The facilities will service development in the Project Area.
11.2.3 Demolition/Site Clearance
The Agency continues to participate in demolition and site clearance activities throughout Tustin
Legacy to prepare sites for development by private and public entities.
11.2.4 Economic Development Programs
The Agency continues to initiate and participate in economic development programs in conjunction
with the business community in the creation of jobs, and the growth and retention of businesses
within the Project Area. The Agency continues to take the lead in business attraction.
• Business Promotion and Attraction: The property owner and tenant assistance programs
promote and support new commercial development within the Project Area, particularly
businesses that are high job generators including retail uses, office uses, and R&D uses.
Expenditures include, but are not limited to brochures, digital media, and marketing materials.
• LAMBRA: Assist business owners eligible for benefits under the Local Agency Military Base
Recovery Act (LAMBRA). LAMBRA benefits include: 1) state tax benefits such as 15-year net
operating loss carry-over; 2) business expense deductions; 3) sales and use tax credits; 4) hiring
tax credits; and, 5) preference points on state contracts.
11.2.5 Environmental Remediation
The Agency coordinates mitigation activities associated with environmental impacts in the Project
Area and environmental impacts found to have a benefit to the Project Area that are outside the
Project Area. The Agency is also engaged in on-site mitigation activities with the Navy as part of the
Economic Development Conveyance process.
City of Tustin staff actively participates with Navy staff and state and federal regulatory agencies
(United States Environmental Protection Agency, California Environmental Protection
Agency/Department of Toxic Substances Control and Regional Water Quality Control Board) in
reviewing and commenting on Navy remediation documents, and providing recommendations to
assist the Navy in selecting remedies that support rapid economic development and reuse at the site,
including specialized legal services associated military base closures and hazardous clean-ups.
14
Environmental Programs the City and Agency have been responsible for during the term of this Plan
are as follows:
• Coordination with the Department of Navy (DoN) in its review of a Project Environmental Review
form (PERF # T012) for mass grading, utility and building demolition, and erosion control on
Navy-owned property and as a precondition to proceeding with the Tustin Ranch Road Project.
Coordination and response also has been to the Base Cleanup Team (BCT), including: the DoN,
the Environmental Protection Agency (EPA), the Department of Toxic Substances Control (DTSC),
Regional Water Quality Control Board (RWQCB) and the City's special Washington D.C. counsel.
The coordination of this PERF is tied to the design and construction of Tustin Ranch Road.
• Coordination with the DoN in its review of a Project Environmental Review Form (PERF k T015)
for a geotechnical investigation of the proposed 24 acre Community Park site on Navy-owned
property. Continued to coordinate response to the BCT, including: the DoN, the EPA, the DTSC,
RWQCB and the City's special Washington D.C. counsel.
in Neighborhood E as part of the former Master Development Footprint.
• Coordinated with Public Works and Irvine Ranch Water District (IRWD) on the potential
installation of a new well (Well Tl-1) at the northeast corner of Barranca Parkway and future
Aston Ave. RDA staff prepared an access and construction license and exclusive easement for
15
Efforts to close out environmental insurance claims associated with the finding of contaminates
well purposes. The license has been tendered to IRWD for execution and a draft exclusive
easement has been transmitted to IRWD for review. The exclusive easement will require
approval by the City Council once accepted by IRWD.
11.2.6 Administrative Program Support & Indirect Costs
Administrative and indirect costs have been ongoing during the term of the Plan. The services
include, but are not limited to, the following:
• Due Diligence activities -third party and in-house services associated the disposition and
development of sites located at Tustin Legacy.
• Legal Services -comprehensive legal services related to activities within the Project Area and
activities outside the Project Area in which a finding of benefit has been established including
City Attorney services and Special Counsel.
• Management of Assets - in-house and contracted third party legal services.
• Planning and Design - in-house and contracted third party services associated with planning and
design activities.
• Leasing of Office Space and Equipment.
• Telephone.
• Printing.
• Audit/Accounting.
• Office Materials and Supplies.
• Meetings and Training.
• Membership Dues and Subscriptions.
• Computer Software and Hardware.
To support the major areas of the Implementation Plan, direct administrative costs, and indirect
costs, including consulting and legal expenses, will also be incurred, as shown in Figure II-5.
11.2.7 Addressing Blighting Conditions through Non-Housing Activities
The CRL requires an explanation of the relationship between proposed projects, programs and
expenditures to the elimination of blight within the project area during the period of the
Implementation Plan. At the time the MCAS Tustin Redevelopment Plan was adopted, the
Implementation Plan addressed health and safety conditions of buildings, and the factors that
characterize economic dislocation, deterioration or disuse. Briefly, a blighted area is one that
contains specific conditions and factors resulting in the lack of proper utilization of the area that
constitutes a serious burden on the community that cannot be alleviated by private enterprise acting
alone.
16
Eliminating blight conditions are addressed through the adopted five-year programs outlined in the
Implementation Plan. Specifically, the Implementation Plan Goals and Objectives will assist in
attracting, retaining and growing businesses that are high job generators; assist in the planning,
design, and installation of public improvements that were non-existent prior to the adoption of the
Implementation Plan; assist in developing community facilities that address community needs; and,
assist in correcting environmental problems that will allow property throughout the Project Area to
be developed.
During the initial five years of the First Implementation Plan (Agency is in the term of the Second
Implementation Plan), the Agency assisted and private sector redevelopment activities have made
major contributions in transforming the Project from a former military base into a mixed use project
comprising both public and private uses that address the needs of the community in housing,
commercial development, job creation, and public facilities. Although significant progress toward
addressing many of the blighting conditions have been completed, or are in the process of being
completed, major blight conditions remain. Many of the blight remediation conditions will be
addressed under the Second Implementation Plan.
The following is a list of major blighting characteristics identified in the MCAS Tustin Redevelopment
Plan and how the proposed Agency programs during this Second Implementation Plan period are
eliminating or preventing the spread of these blighting conditions within the Project Area:
Unsafe/Unhealthy Buildings. The former MCAS Tustin base contains buildings and structures
used by its former occupant, the Marine Corps. Many of these buildings contain materials that
are no longer considered suitable for human occupancy. In addition, most of the buildings are
special purpose military buildings, including hangars used in the upkeep and maintenance of
helicopters. Many of the buildings date back to the 1940's and 1950's and none of the buildings
have been maintained since the early 1990's.
Most of the buildings that had not been removed during the term of the initial Implementation
Plan that the Agency and City control have been removed during the term of the Second
Implementation Plan. Additionally, other public agencies receiving property have plans for
demolition underway.
Factors that Hinder Economic Viability Use. Inadequate and obsolete infrastructure, inadequate
and obsolete buildings, and hazardous waste are factors that hinder economically viable uses.
During the term of the Second Implementation Plan existing obsolete infrastructure has been
removed, existing obsolete buildings have removed, and identified hazardous waste from the
former military occupant has been removed or is in the process of being removed and/or
environmentally treated.
• Adjacent/Nearby Incompatible Uses. The former Marine base contained military uses that are
not compatible with the uses adopted in the Reuse/Specific Plan and the MCAS Tustin
Redevelopment Plan.
17
During the First and Second Implementation Plan terms, additional Marine based uses and
buildings have been removed. While some continue to remain, incompatible uses are being
addressed by current or planned future activities.
• Buildings On Land That When Subdivided Would Not Meet Local Regulations. The former
Marine base contained buildings that are or were not compatible with the City's zoning code.
The buildings occupying the former base were built for military functions and were exempt from
local regulations as a Federal facility. None of the buildings on the former base were found
suitable for occupancy.
Most of the former military facilities including the majority of the aircraft runways, taxiways and
aprons have been removed during the term of the Second Implementation Plan. While some
continue to remain, they are addressed by current or planned future activities.
• Inadequate Infrastructure And Public Improvements. Existing infrastructure serving the former
MCAS Tustin base is antiquated having deteriorated over time. Additionally, the infrastructure
did not have the capacity to adequately serve the proposed uses under the Reuse/Specific Plan.
Infrastructure necessary to serve the uses under the Reuse/Specific Plan was installed during the
term of the initial Implementation Plan by the private sector under various financing
mechanisms. Not all of the necessary infrastructure can be installed by the private sector
without financial assistance from the Agency.
Under the First and Second Implementation Plan appropriate public infrastructure is being
installed to allow for the development of the Tustin Legacy project including completing of the
construction of Tustin Ranch Road. Additional infrastructure will continue to remain important
to development of the property.
• Buildings That Did Not Conform To Codes Effective When Built. The closure of the Marine Corps
base resulted in the abandonment of buildings and the creation of vacant lots.
During the term of the Second Implementation Plan the Agency has been engaged with private
sector developers and public entities to develop formerly vacant properties and reuse properties
that contained military buildings with no functional uses, other than military.
• Facilities That Must ee Removed To Allow Development. Buildings on the former military base
will be demolished that are unsafe or unhealthy. All of the former military buildings are in
various stages of decay due to lack of maintenance after the base was abandoned by the Marine
Corps in the early 1990's. Removal of existing buildings, facilities, and infrastructure is intended
to eliminate incompatible adjacent or nearby uses such as the presence of military or aircraft-
related uses that are now obsolete, but would facilitate the effective reuse and development of
non-military uses in the Project Area.
During the term of the Second Implementation Plan most of the former military facilities that are
within the Agency or City's control have been removed outside the immediate area of the two
blimp hangars. While some continue to remain, they are being addressed by current or planned
future activities.
18
• Hazardous Waste. The programs proposed are intended to eliminate or alleviate hazardous
waste conditions and encourage private investment in the Project Area.
During the term of the First and Second Implementation Plan, the Agency continues to work with
local, regional, state, and federal agencies in clean-up activities resulting from military
operations.
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Section III
2na Five-Year Implementation Plan
Mid-Term Report
Housing Activities
zo
III.1 INTRODUCTION
The Housing Section is a major component of the Implementation Plan. The Plan represents the
Agency's explanation of how specific goals and objectives and proposed projects, programs and
expenditures will implement the low and moderate income housing requirements mandated by
law, including the following:
• An annual housing program for the five year Implementation Plan term that provides
sufficient detail to measure performance of the Low and Moderate Income Housing Fund
Requirements.
• An estimate of the number of new, rehabilitated, assisted, price restricted and destroyed
housing units during the term of the respective redevelopment plan.
• An outline of the Agency's plan in using the Housing Set Aside Funds, including annual
deposits, transfers of funds, or accruals for special projects.
• An identification of programs and projects that will result in the destruction or removal of
existing affordable housing, if any, and the proposed locations for replacement housing.
• The Agency's ten year housing affordability compliance plan as required by California
Community Redevelopment Law (CRL) Sections 33413(b)(4) and 33490(a)(2).
111.2 BACKGROUND
In addition to CRL requirements, the Agency's affordable housing efforts are guided by the
Regional Housing Needs Assessment (RHNA) produced by the Southern California Association of
Governments (SCAG), and the City's Housing Element and Comprehensive Affordable Housing
Strategy. In June 2008, the City and the Community Redevelopment Agency adopted the 2008/09
- 2017/18 Comprehensive Affordable Housing Strategy (CANS) to direct and focus the City's and
Agency's efforts to produce and maintain affordable housing within the community. The CANS is
largely the basis upon which the Second Five-Year Implementation Plan has been formulated.
While the 2000/01 - 2009/10 Comprehensive Affordable Housing Strategy had not expired,
significant changes in the housing market led the Agency to prepare an updated CANS Strategy for
the 2008/2009 to 2017/2018 period, to be coordinated with the City's required S year update of
its Housing Element. The updated CANS furthers the Agency's affordable housing efforts while
taking into account the changing market and ensuring consistency between Agency activities and
the Housing Element.
The housing component of the 2"d Five-Year Implementation Plan is also guided by the numerous
provisions of the Community Redevelopment Law that regulate low and moderate-income
housing activities. Asa result, the Housing Section of the Implementation Plan is more
comprehensive than the section for non-housing redevelopment activities. Along with outlining
the programs including the activities and expenditures, the housing component also evaluates the
Agency's compliance with the laws and regulations governing the Low and Moderate-Income
Housing Set-Aside Fund and Housing Production in a Redevelopment Project Area. More
particularly, the report reviews the Agency's major housing responsibilities which generally fall
under four broad categories including: 1) the set-aside of 20% of gross tax increment for low and
21
moderate-income housing (Sections 33334.2 and 33334.6 of CRL); 2) the creation of housing
affordable to low and moderate income persons and families based on the production of all new
or substantially rehabilitated dwelling units (Section 33413(b) of CRL); 3) the replacement of low
and moderate-income dwelling units removed as result of Agency activity (Section 33413(a) of
CRL); and 4) the proportional expenditure from the 20% Set Aside fund on housing for low and
very low income persons based on community need (Section 33334.4(a)).
The goals of the Housing Program are to increase the quantity and improve the quality of housing
stock in Tustin by providing new and rehabilitated affordable housing opportunities throughout
the community. To accomplish the goals and objectives of the Housing Program, the Agency
adopted a Finding of Benefit on June 2, 2003, as allowed under the law, which determined the use
of Housing Set-Aside Funds outside of designated Redevelopment Project Areas and throughout
the City that would be of direct benefit to the MCAS Tustin Redevelopment Project Area.
Under California Health and Safety Code Section 33413, at least 15% of all new and substantially
rehabilitated dwelling units developed within a project area are required to be made available at
an affordable housing cost to and occupied by persons and families of low or moderate-income.
Not less than 40% of the total required affordable dwelling units are to be made available to very
low income households. The ten year production and expenditure requirements under the CRL
put a high financial burden on the Agency's new MCAS Tustin Redevelopment Project Area.
Insufficient tax increment revenue in the MCAS Tustin Redevelopment Project Area's early years
limited the Agency's ability to directly subsidize affordable housing.
In order to assist the Agency in meeting its affordable housing obligations within the MCAS Tustin
Redevelopment Project Area, the City entered into affordable housing agreements, as a condition
of developing a larger project or sold City-owned land within the Project Area at a discount to the
market value conditioned upon the development of affordable housing. On June 5, 2007, the City
Council approved the "Reimbursement Agreement Between the City of Tustin and Tustin
Community Redevelopment Agency Related to Affordable Housing Responsibilities to be Assumed
by the Agency ("Reimbursement Agreement")".
Under the Reimbursement Agreement, the Agency is reimbursing the City for its financial
assistance in carrying out the Agency's Redevelopment Plan objectives, including the production
of affordable housing units. The reimbursement may come from 80% tax increment/non-housing
funds and from 20% tax increment/Housing Set-Aside Funds. Reimbursement sources are not
limited to the MCAS Tustin Project Area, but may also come from 80% tax increment/non-housing
funds and 20% tax increment/Housing Set-Aside Funds from the Town Center and South Central
Project Areas.
22
111.3 RECENT LEGISLATION AFFECTING HOUSING ACTIVITIES
As described in Section II.B of this Mid-Term Report, the passage of AB1X 26 (the "Dissolution
Bill") and AB1X 27 (the "Voluntary Program Bill") will have a significant effect on Agency financial
resources. Although no decision has been made at this time as to whether any City adoption of
an ordinance to comply with A61X 27 and the Voluntary Program payments required by the
Voluntary Program Bill will utilize Housing Set-Aside funds, any Agency payments will significantly
deplete the Agency's total financial resources and, thereby, impact the development timeline at
MCAS Tustin, a timeline already slowed by a sluggish economy. With limited resources to fund
development and infrastructure, housing programs originally outlined in the Second Five-Year
Implementation Plan could be further delayed and most likely will not occur before the end of the
Second Five-Year Implementation Plan.
On January 1, 2008, Assembly Bill (AB) 987 became effective, requiring redevelopment agencies
to compile and maintain a database of existing, new and substantially rehabilitated housing units
developed or otherwise assisted with monies from the Low and Moderate Income Housing Fund.
The database must be available to the public on the Internet, and be updated on an annual basis.
The Agency's database consists of two lists, one for affordable owner-occupied housing units and
the other for affordable rental housing projects. The list can be found on the City of Tustin
website, www.tustinca.or~, under Redevelopment/Housing Programs. In addition, AB 987
requires the recordation of a separate document, called "Notice of Affordability Restrictions on
Transfer of Property," for all new or substantially rehabilitated units developed or otherwise
assisted with moneys from the Low and Moderate Income Housing Fund on or after January 1,
2008. The Agency spends considerable effort and staff time to accomplish these requirements
and it is currently in full compliance. Although unknown at this time, it is expected before the end
of this year's session of the State Legislature, that additional bills may also be adopted with
additional impact on redevelopment operations including housing activities.
111.4 THE LOW AND MODERATE INCOME HOUSING FUNDS AVAILABLE
Section 33334.2 of the CRL requires, for every redevelopment plan adopted or amended to add
territory on or after January 1, 1977, no less than 20 percent of the tax increment received by the
Agency from a Redevelopment Project Area be set aside for increasing, improving and preserving
the community's supply of low and moderate income housing. The revenues may be expended
inside or outside of a project area. If expended outside the Project Area, a resolution must be
adopted stating that outside expenditures are of benefit to the Project Area. As discussed earlier,
the Redevelopment Agency adopted Resolution No. RDA 03-10 on June 2, 2003, stating that
outside expenditures benefitted the Project Area. There were approximately $3.6M in housing
funds available as of June 30, 2011. With the recently enacted state budget and redevelopment
reform legislation, there is a distinct possibility that funding levels will be negatively impacted for
the remaining two years of the Implementation Plan.
23
In March 2010, to meet housing obligations, the Agency issued Tax Allocation Bonds (Series 2010)
which encumbered the MCAS Tustin, South Central and Town Center Project Area funds. Initially,
it is estimated over the balance of the Second Implementation Term, that debt service for the
MCAS Tustin Project Area will be approximately $608,000 to $609,000 annually which will
significantly impact operational capabilities.
III.S HOUSING PROGRAMS, PROJECTS AND EXPENDITURES
A description of the projects and program expenditures comprising the Agency's housing activities
during the 2008-2013 Implementation Plan and a Midterm update are provided below.
a. Tustin Legacy -Ownership Multi-Family New Construction (322 units, $39,753,509)
It was anticipated that 322 affordable ownership units would be created during the Second
Implementation Plan term. The 322 units were to be distributed as follows: 40 units for very
low income households, 116 units for low income households, and 166 units for moderate
income households. While no Agency direct funding would be provided by the Agency for the
affordable units in the Villages of Columbus, units would be developed as a result of the City
providing density bonus incentives, including variances of certain development standards as a
financial incentive, towards the developer's provision of affordable housing.
The unit count in Neighborhoods D and G represented Phase 1 of the TLCP Master Planned
development. In July 2010, the City terminated the Master Developer agreement with TLCP.
On April 25, 2011, the City Council adopted a Disposition Strategy for the Former Master
Developer Footprint. The goal of producing 322 affordable units remains intact and it is
anticipated that at least 50 of these units may be under construction during the Second Five-
Year Implementation Plan. The subsidy requirement by the Agency is unknown at this time,
but we can assume that the average subsidy for an owner occupied affordable unit will be
consistent with at least current affordability gaps of providing affordable ownership units by
household type currently at the Tustin Legacy project. The initial subsidy was borne by the
City as an off-set against land sale value with the cost being transferred to the Agency under
the terms and conditions of the existing Reimbursement Agreement, as amended. However,
upon reevaluation, we believe that the subsidy will be lower in the event that the units are
developed as affordable rental tenure (apartment product). Depending on financing markets
and also other market conditions, the Agency would reduce its affordability gap in producing
affordable units at Tustin Legacy by requiring development of affordable rental apartment
units rather than affordable ownership units.
b. Tustin Legacy -Multi-Family Rental, New Construction (253 units, $35,445,300)
The City's Disposition and Development Agreement with the former Master Developer called
for the development of 253 new affordable rental units, including 126 units for very low
income households, 64 units for low income households, and 63 units for moderate income
households. The unit count represented originally projected Phase 1 development within a
Master Development Footprint.
24
The Agency is unable to estimate when the construction of all 253 units will be completed.
However, we estimate that construction of 211 affordable apartment units will be initiated
before the end of the Five-Year Implementation Plan period. The amount of housing funds
required to subsidize the development of affordable rental units is unknown at this time given
current economic and legislative conditions.
Coventry Court, a senior housing development in the Villages of Columbus, was originally
identified in the Implementation Plan as ownership units. In July 2010, the City Council
approved the change in tenure for the project from ownership to rental. This will result in
construction of 153 affordable apartment units which should be completed before the end of
the 2"d Five-Year Implementation Plan term.
c. First Time Homebuyer Assistance and/or Foreclosure Negotiated Purchase
(1 unit, $160,000)
A First-Time Homebuyer Program would provide down payment and second mortgage
assistance to low and moderate income buyers to assist them to purchase an existing home in
the City. The recent mortgage credit crises have resulted in increasing foreclosure rates
throughout many parts of California. The City originally allocated $160,000 to assist new first-
time homebuyers in purchasing a home in a Tustin Legacy residential development or in the
possible negotiated purchase of a home in foreclosure, which may represent a lower cost
buying opportunity for first-time homebuyers. Due to budget constraints, the Agency has not
initiated a revamped First Time Homebuyer Program, but anticipates potentially purchasing
one affordable home through the foreclosure process during the Implementation Plan term.
d. Homeless Assistance and Supportive Services (non-local resource)
The City has allocated $60,000 in CDBG funds to continue its financial support of homeless
assistance and supportive services in the City. The City's goal for this program is to assist 200
homeless individuals per year during the 2"d Five-Year Implementation Plan. It is estimated
that 1,413 people have been assisted since July 1, 2008.
e. Administrative Support Expenditures ($1,439,579)
Administrative Support costs incurred and directly related to implementing the housing
program include salaries, overhead, consultant and legal expenses, supplies, etc. The
Agency's administrative program support expenditures from Housing Set-Aside Funds must
be determined each year and found to be necessary to implement the housing program (CRL
Section 33334.3(d)). As a result of decreased development activity, the Agency has
implemented cost saving measures, reduced housing staff and expects to spend less than
originally estimated.
CRL Section 33334.12(g)(1) identifies that beginning fund balances in any year which exceed the
higher of $1M or the sum of the prior 4 year deposits and which are funds that have not been
contractually encumbered are considered "Excess Surplus" and such funds must be expended
25
within one year. The Agency has contractually encumbered its Housing Set-Aside Fund balance
and, as a result, is in compliance with CRL.
111.6 PROPORTIONAL EXPENDITURE OF HOUSING FUNDS
Section 33334.4(a) of the CRL requires expenditures in the Low and Moderate Income Housing
Fund during a 10-year period to assist very low and low income households in at least the same
proportion as the total number of units needed within the community. The proportion of very
low, low and moderate income units is determined for each community on the basis of the unmet
need for housing amount certain income group categories as reflected in the City's share of the
regional housing needs identified pursuant to Section 65584 of the California Government Code
(the Regional Housing Needs Assessment (RHNA)). In addition, CRL Section 33490(a)(2)(C)(i)
requires the Agency to identify the number of housing units needed for very low, low and
moderate income persons as each of those needs have been identified in the most recent
determination pursuant to Section 65584. The number of housing units was produced by the
Southern California Association of Governments (SCAG) and has been in effect since January 1,
2006 and was included in the recently adopted Housing Element of the General Plan.
At the time of the 2"d Five-Year Implementation Plan's adoption, the Agency's RHNA proportional
expenditure requirements were 37% for very low income households and 29% for low income
households. Pursuant to CRL Section 33334.4(a), the Agency may adjust the proportion by
subtracting from the need identified for each income category, the number of units for persons of
that income category that are newly constructed over the duration of the implementation plan
with other locally controlled assistance and without agency assistance. The City initiated the
development of additional very low, low and moderate income housing in the MCAS Tustin
Project Area through density bonus incentives. Therefore, the Agency is permitted to adjust the
proportional expenditure requirements accordingly. In addition, MCAS Housing Set-Aside Funds
can be used outside of the Project Area based upon an adopted benefit resolution and the Agency
will insure funds used as such will assist the Agency's efforts to comply with the 10-year
requirement.
As a result of the housing activities that have occurred to date and as adjusted pursuant to
Section 33334.4(a) of CRL, the Agency will be required to have spent, at minimum, 20% of
Housing Set-Aside Funds for very low income households and 36% for low income households.
The target is intended over a 10-year period of the Implementation Plan and not measured strictly
on an annual basis. The goal will be adjusted in conjunction with any further locally assisted
projects not funded by the Agency. The Agency expects that it will be able to ensure that
expenditures are in proportional compliance with Section 33334.4(a).
In addition, as of January 1, 2003, according to CRL Section 33334.4(b), each redevelopment
agency shall expend, over the duration of each redevelopment Implementation Plan, funds for all
persons regardless of age in at least the same proportion as the number of low-income
households with a member under age 65 years as compared to the total number of low-income
26
households of the community as reported in the most recent census of the United States Census
Bureau. According to the 2000 U.S. Census, 87% of low-income households in Tustin included a
member under the age of 65. Therefore, it is the Agency's goal to spend at minimum 87% of the
moneys in the Housing Fund for non-senior affordable housing activities to reflect this proportion
of persons under 65 years of age in the community. All of the units produced to date are for
family housing and no expenditures have been made for senior housing units. Coventry Court,
housing development for active seniors, is projected to open in FY 2011/12; providing 153
affordable units as a result of City density bonus incentives, therefore no direct Housing Set-Aside
Funds are committed to this project.
111.7 AFFORDABLE HOUSING COMPLIANCE PLAN
a. Housing Production
The MCAS Tustin Project Area was adopted in 2003, and as a result, is subject to housing
requirements contained in Section 33413 of CRL. These requirements mandate that certain
percentages of all housing developed in the project area be affordable to low to moderate income
households.
• At least 15% of the units developed or substantially rehabilitated in the Project Area (there
are currently only new units being developed) by public or private entities other than the
Agency (including such entities receiving agency assistance) must be available at an affordable
housing cost to, and occupied by, persons and families of low to moderate income. Of these
units, not less than 40% must be affordable to very low income households. This translates to
a very low income requirement of 6% of the total units developed in the Project Area.
• Although rehabilitation and construction activities are not currently envisioned for the Agency
directly by the Implementation Plan, at least 30% of the housing developed or substantially
rehabilitated by the Agency itself within a project area must be available at affordable
housing cost, and occupied by persons or families of low to moderate income. Of these units,
50% must be affordable to very low income households. This translates to a very low income
requirement of 15% of the total project area units developed or substantially rehabilitated by
the Agency. This requirement applies only to units directly developed by the Agency and
would not apply to units developed by housing developers pursuant to agreements with or
assistance from the Agency.
Per Section 33413(b)(2)(A)(iii) of the CRL, substantially rehabilitated dwelling units means all units
substantially rehabilitated with Agency assistance. Section 33413(b)(2)(A)(iv) of the CRL also
defines substantial rehabilitation as "rehabilitation, the value of which constitutes 25% of the
after rehabilitation value of the dwelling, inclusive of land value."
Effective January, 2004, long term affordability covenants must be recorded on dwelling units
produced pursuant to Section 33413 of the CRL, requiring that the units be maintained at an
affordable housing cost to, and occupied by, persons and families of low to moderate income, for
27
the longest feasible time, but not less than 55 years for rental units and 45 years for owner
occupied units. The affordability controls on such units must be made enforceable by recorded
covenants or restrictions in the same manner as required for units assisted by the Agency's 20%
Housing Set Aside Fund if they are to count towards meeting production requirements.
Section 33413(b)(4) of the CRL also requires that the Agency's Implementation Plan for housing
activities must be consistent with the community's housing element and the Agency's housing
production requirement must be met every ten years. If more than the required number of low
and moderate income units are developed in the 10-year period, the affordable units in excess of
the required number may be counted towards the Agency's requirements for the next 10-year
period. If fewer than the required number of units are developed at the end of the ten year
period, the Agency must meet its production goals on an annual basis until the requirements for
the 10-year period are met. The Agency may cause the required inclusionary housing units to be
produced inside or outside the redevelopment project area, but all units developed or
substantially rehabilitated by the private sector, require two units outside the project area for
each unit that otherwise would have had to be available inside the project area.
b. Past Production of Affordable Units in the Project Area
The MCAS Tustin Specific Plan has authorized the development of 4,210 housing units, of which
4,076 units are proposed within the MCAS Tustin Redevelopment Project Area. Approximately
21% of the housing is projected to be available at an affordable housing cost to low and moderate
income households.
At the time of this Mid-Term Report for the Second Implementation Plan, there have been 1,614
housing units built, including 273 affordable ownership units. The Agency is currently exceeding
the housing production requirements for low and moderate income units and is 27 units behind
on the very low income unit requirement. It was not projected during the term of the 2"d Five-
Year Implementation Plan that the Agency would substantially rehabilitate dwelling units within
the Project Area; all of the affordable units within the Project Area are new or have been
constructed within the last five years.
c. Housing Units to be Developed (Future Production).
Depending upon the financial constraints created by the passage of AB1X 26 and ABiX 27,
successful implementation of projects, programs, and expenditures identified previously in the
housing portion of the 2"d Five-Year Implementation Plan could create some additional new
affordable units over the remaining two years of the Plan as described previously under individual
programs. While some housing development is intended to occur over the last two years of the
Implementation Plan, the Agency may not completely meet its program objectives. However, the
Agency does not anticipate any problem in meeting its required housing affordability production
obligations under State Law when units are actually constructed.
28
111.8 REPLACEMENT HOUSING OBLIGATIONS
Section 33413(a) of the CRL requires that whenever dwelling units housing low or moderate
income households are destroyed or removed from the low and moderate income housing
market as part of a redevelopment project that is subject to a written agreement with the Agency
or where financial assistance has been provided by the Agency, the Agency shall, within four years
of the destruction or removal, rehabilitate, develop, or construct, or cause to be rehabilitated,
developed, or constructed, an equal number of replacement dwelling units which have an equal
or greater number of bedrooms as those removed or destroyed at affordable housing costs within
the jurisdiction of the Agency. The replacement housing units shall be available at affordable
housing cost to persons in the same or a lower income category (low, very low, or moderate), as
the persons displaced from those destroyed or removed units. The MCAS Tustin Redevelopment
Plan and 2"d Five-Year Implementation Plan have determined that no replacement housing unit
obligations would occur.
111.9 ADDRESSING BLIGHTING CONDITIONS THROUGH HOUSING ACTIVITIES
The CRL requires an explanation of the relationship between proposed projects, programs and
expenditures to the elimination of blight with the project area during the period of the plan. At
the time the MCAS Tustin Redevelopment Plan was adopted, the plan spoke to health and safety
conditions of buildings, and the factors that characterize economic dislocation, deterioration or
disuse. The following is a list of major blighting characteristics identified in the MCAS Tustin
Redevelopment Plan and how the proposed Agency housing programs during the 2nd Five-Year
Implementation Plan will eliminate or prevent the spread of these blighting conditions within the
Project Area:
• Unsafe/Unhealthy Buildings. The former MCAS Tustin base contains buildings and structures
used by its former occupant, the Marine Corps. Many of these buildings contain materials
that are no longer considered suitable for human occupancy. In addition, most of the
buildings are special purpose military buildings including hangars used in the upkeep and
maintenance of helicopters. Many of the buildings date back to the 1940's and 1950's, none
of the buildings have been maintained since the early 1990's.
Areas zoned for residential development will benefit from the Ownership Multi-Family New
Construction and Multi-Family Rental New Construction programs. Despite the economy,
some additional development is anticipated which will permit construction and require
buildings and other structures that are unsafe and unhealthy to be removed.
• Factors that Hinder Economic Viability Use. Inadequate and obsolete infrastructure,
inadequate and obsolete buildings, and hazardous waste are factors that hinder economically
viable uses.
Any residential development that occurs during the remainder of the 2nd Five-Year
Implementation Plan, including Ownership Multi-Family New Construction and Multi-Family
29
Rental New Construction programs, will involve removing obsolete buildings and replacing
inadequate and obsolete infrastructure.
• Adjacent/Nearby Incompatible Uses. The former Marine base contained military uses that
are not compatible with the uses adopted in the Reuse/Specific Plan and the MCAS Tustin
Redevelopment Plan.
During the first and 2"d Five-Year Implementation Plan terms, housing programs will result in
removal of incompatible uses. While some continue to remain, incompatible uses are being
addressed by current or planned future activities.
• Buildings on Land That When Subdivided Would not Meet Local Regulations. The former
Marine base contained buildings that are or were not compatible with the City's zoning code.
The buildings occupying the former base were built for military functions and were exempt
from local regulations as a Federal facility. None of the buildings on the former base were
found suitable for occupancy.
Most of the former military facilities including the majority of the aircraft runways, taxiways
and aprons have been removed during the term of the Second Implementation Plan. Housing
activities, when the land is subdivided will be addressed by current or planned future
activities.
• Inadequate Infrastructure & Public Improvements. Existing infrastructure serving the former
MCAS Tustin base is antiquated having deteriorated over time. Additionally, the
infrastructure did not have the capacity to adequately serve the proposed uses under the
Reuse/Specific Plan. Infrastructure necessary to serve the uses under the Reuse/Specific Plan
was installed during the term of the initial Implementation Plan by the private sector under
various financing mechanisms. Not all of the necessary infrastructure can be installed by the
private sector without financial assistance from the Agency.
Under the First and Second Implementation Plan appropriate public infrastructure is being
installed to allow for the development of the Tustin Legacy project including infrastructure
necessary to support housing activities. Additional infrastructure will continue to remain
important for implementation of housing activities.
• Buildings that did not Conform to Codes Effective when Built. The closure of the Marine
Corps base resulted in the abandonment of buildings and the creation of vacant lots.
During the term of the 2"d Five-Year Implementation Plan, the Agency has been engaged with
private sector developers and public entities to develop formerly vacant properties and reuse
properties that contained military buildings with no functional uses, other than military.
During the remaining term of the 2~d Five-Year Implementation Plan, development of vacant
lots for housing activities will be expected.
• Facilities that must be Removed to Allow Development. Buildings on the former military base
will be demolished that are unsafe or unhealthy. All of the former military buildings are in
various stages of decay due to lack of maintenance after the base was abandoned by the
30
Marine Corps in the early 1990's. Removal of existing buildings, facilities, and infrastructure is
intended to eliminate incompatible adjacent or nearby uses such as the presence of military
or aircraft-related uses that are now obsolete, but would facilitate the effective reuse and
development of non-military uses in the Project Area.
During the term of the Second Implementation Plan most of the former military facilities that
are within the Agency or City's control have been removed outside the immediate area of the
two blimp hangars. While some continue to remain, they are being addressed by current or
planned future housing activities.
Hazardous Waste. The programs proposed are intended to eliminate or alleviate hazardous
waste conditions and encourage private investment in the Project Area.
During the term of the first and 2~d Five-Year Implementation Plans, the Agency continues to
work with local, regional, state, and federal agencies in clean-up activities resulting from
military operations which will impact housing activities.
31
Attachment A
32
SECOND FIVE-YEAR
IMPLEMENTATION PLAN
FOR THE
MCAS TUSTIN
REDEVELOPMENT PROJECT AREA
(FY 2008-2009 to FY 2012-2013)
Tustin Community Redevelopment Agency
July, 2008
TABLE OF CONTENTS
SECTION I -FIVE YEAR IMPLEMENTATION PLAN INTRODUCTION .................................. 5
SECTION II -FIVE YEAR IMPLEMENTATION PLAN FOR NON-HOUSING ACTIVITIES
11.1 Background ...................................................................................................... 10
11.2 Major Accomplishments .................................................................................. 13
11.3 Non-Housing Program Financial Resources .................................................... 20
11.4 Existing Debt Obligations (Non-Housing and Housing) ................................... 21
11.5 Agency Five Year Non-Housing Implementation Activities ............................. 23
11.5.1 Introduction ........................................................................................ 23
11.5.2 Cash Flow ............................................................................................ 24
11.5.3 Five Year Projects, Programs, and Expenditures ................................ 25
SECTION III -FIVE YEAR IMPLEMENTATION PLAN FOR HOUSING ACTIVITIES
III.1 Introduction .................................................................................................... 33
111.2 Background ..................................................................................................... 33
111.3 Recent Legislation Affecting Housing Activities ............................................. 35
111.4 The Low and Moderate Income Housing Funds Available ............................. 35
111.5 Housing Programs, Projects and Expenditures .............................................. 37
111.6 Proportional Expenditure of Housing Funds .................................................. 40
111.7 Affordable Housing Compliance Plan ............................................................. 46
111.8 Replacement Housing Obligations ................................................................. 50
SECTION IV - RELATIONSHIP TO BLIGHT .......................................................................... 51
SECTION V -SUMMARY and CONCLUSION ...................................................................... 55
Tustin Community Redevelopment Agency Page 12
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
LIST OF FIGURES
FIGURE I-1 Summary of Legal Requirements ................................................................. 5
FIGURE I-2 Physical and Economic Blight Defined ......................................................... 7
FIGURE I-3 MCAS Tustin Redevelopment Project Area Map ......................................... 8
FIGURE II-1 Redevelopment Goals and Objectives MCAS Tustin Project Area ............... 11
FIGURE II-2 Project Area Data Summary ......................................................................... 12
FIGURE II-3 Highlights During Initial Implementation Plan ............................................ 13
FIGURE II-4 Five-Year Non-Housing Activities Illustrative Cash Flow ............................. 24
FIGURE II-S Programs -Non-Housing Expenditures ........................................................ 31
FIGURE III-1 Summary of Housing Set-Aside Funds ......................................................... 36
FIGURE III-2 Five-Year Housing Programs Illustrative Cash Flow ..................................... 39
FIGURE III-3 Estimate Annual Distribution of Assisted Units & Households ................... 40
FIGURE III-4 2006-2014 RHNA Adjusted Affordable Housing Expenditure Goal ............. 42
FIGURE III-5 Ten Year RHNA Affordable Housing Expenditure Compliance Plan ............ 45
FIGURE III-6 Project Area Inclusionary Housing Production ............................................ 48
FIGURE III-7 Future Project Area Inclusionary Housing Production ................................ 49
FIGURE IV-1 MCAS Tustin Project Area Blight Elimination Relationship Table ................ 54
APPENDIX TABLES
APPENDIX A Affordable Housing Production Tabulations ................................................ 56
APPENDIX B Public Infrastructure and Community Facilities ........................................... 58
Tustin Community Redevelopment Agency Page 13
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
Section I
Five-Year Implementation Plan
Introduction
Tustin Community Redevelopment Agency Page ~ 4
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
INTRODUCTION
This document has been prepared by the Tustin Community Redevelopment Agency
("Agency") pursuant to Article Section 33490 of California Community Redevelopment Law
("CRL" or "State Law") (Figure I-1). It is the Second Five-Year Implementation Plan ("Plan") for
the Redevelopment Plan ("Redevelopment Plan") for the MCAS Tustin Redevelopment
Project ("Project" or "Project Area") in the City of Tustin (the "City").
Redevelopment Agencies are required to adopt an Implementation Plan every five years. The
initial Implementation Plan for MCAS Tustin was incorporated into Section VI of the Report to
City Council during the adoption process for the MCAS Tustin Redevelopment Plan. The
Agency approved a Report to the City Council for the MCAS-Tustin Redevelopment Project
("Report") and authorized its transmittal to the Tustin City Council on April 21, 2003. This
Report includes an Implementation Plan for the MCAS Tustin Project Area pursuant to Section
33352(c) of CRL. The City and Agency subsequently considered the Report to the City Council
and the Redevelopment Plan and introduced Ordinance No. 1276 to approve and adopt the
Redevelopment Plan for the MCAS-Tustin Redevelopment Project on June 2, 2003. Ordinance
1276 was subsequently adopted on June 16, 2003. Amid-term review and public hearing on
the initial Implementation Pfan occurred on June 19, 2006, as required by CRL.
SUMMARY OF LEGAL REQUIREMENTS
California Community Redevelopment Law, Article 16.5, Section 33490
Section 33490(a) of the California Community Redevelopment Law requires each redevelopment agency to
adopt an implementation plan every five years that includes:
• The Agency's specific goals and objectives for its redevelopment project areas.
• Specific programs, including potential projects, and estimated expenditures for the next five years.
• An explanation of how these goals, objectives, projects, and expenditures will eliminate blight in the Project
Areas.
• An explanation of how these specific goals, objectives, projects and expenditures will implement the low and
moderate-income housing requirements mandated bylaw, including the following:
1. An annual Housing Program for the five-year term that provides sufficient detail to measure
performance of the Low and Moderate Income Housing Fund requirements.
2. An estimate of the number of housing units to be rehabilitated, assisted, price restricted, or
destroyed during the term of the redevelopment plan for the MCAS Tustin redevelopment project.
3. An outline of the Agency's plan in using the Low and Moderate Income Housing fund including
annual deposits, transfer of funds, or accruals for special projects.
4. An identification of programs and projects that will result in the destruction of existing affordable
housing (if any) and the proposed locations for replacement housing.
5. The Agency's Ten-Year Housing Affordability Compliance Plan as required by California Community
Redevelopment law, Sections 33413(b)(4) and 33490 (a)(2).
The purpose of the Second Five-Year Implementation Plan for the MCAS Tustin
Redevelopment Project, for non-housing activities, is as follows:
Tustin Community Redevelopment Agency Page 15
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
• Revisit the goals and objectives of the Redevelopment Plan.
• Define the Agency's strategy for achieving the goals and objectives of the
Redevelopment Plan.
~ Identify anticipated programs, projects and estimated expenditures for the next five-
yearperiod (Fiscal Years 2008/2009 through 2012/2013).
• Describe how these programs, projects, and expenditures will eliminate blight in the
Project Area.
The Second Five-Year Implementation Plan should address the Agency's housing activities as
follows:
• Demonstrate how the statutory requirements for the set-aside and expenditure of tax
increment for housing purposes will be met including programs, projects and
expenditures directed towards increasing, improving, and preserving the community's
supply of low and moderate-income housing.
• Identify how residential development will be implemented in the Project Area per the
Agency's established goals and in compliance with the CRL.
The elimination of blight as summarized, which follows in Figure I-2 below, is a fundamental
purpose for redevelopment under CRL and is discussed more fully in Section II of this Plan.
The provision of affordable housing is another fundamental purpose under the CRL, and is
addressed in Section III of this Plan. While identification of specific programs, including
projects, and estimates of expenditures proposed to be made is required under CRL, the
Implementation Plan should be viewed as a policy and program document. The intent is not
to restrict the Agency's activities since the conditions, expectations, resources, and needs of
the Project may change from time to time. Rather, this Plan outlines the current expectations
of the Agency for the next five years. This Plan will be subject to a mid-term review by the
Agency Board of Directors.
Tustin Community Redevelopment Agency Page 16
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
Blight
A primary requirement of a Redevelopment Project and an Implementation Plan is to address
the elimination of and the prevention of the spread of blight. Figure I-2 provides a definition
of physical and economic blight conditions under the CRL existing at the time of adoption of
the Redevelopment Plan. The CRL has been amended since the adoption of the Plan, but the
operative definitions of blight, for purposes of the Plan, are as set forth in Figure 1-2. Some
of the conditions continue to exist in the MCAS Tustin Project Area and are addressed in
Section II of this Implementation Plan.
Figure I-2
PHYSICAL AND ECONOMIC BLIGHT DEFINED
California Community Redevelopment Law, Article 3, Sections 33030 and 33031
Sections 33030 and 33031 of the California Community Redevelopment Law define blight to include:
Unsafe/Dilapidated/Deteriorated Buildings. Buildings in which it is unsafe or unhealthy for persons
to live or work. These conditions can be caused by serious building code violations, dilapidation or
deterioration, defective design or physical construction, faulty or inadequate utilities, or other similar
factors.
Physical Conditions that Limit the Economic Viability and Use of Lots and Buildings. Factors that
prevent or substantially hinder the economically viable use or capacity of buildings or lots. These
conditions can be caused by a substandard design, inadequate size given present standards and
market conditions, lack of parking, or other similar factors.
Incompatible Uses. Adjacent or nearby uses that are incompatible with each other and which
prevent the economic development of those parcels or other portions of the project area.
Lots of Irrettular Shape, Inadequate Size, and Under Multiple Ownership. The existence of subdivided
lots of irregular form and shape and inadequate size for proper usefulness and development that are
in multiple ownership.
Inadequate Public Infrastructure/Facilities. The existence of inadequate public improvements,
parking facilities, open space, or utilities.
Depreciated/Stagnant Property Values; Impaired Investments. Depreciated or stagnant property
values or impaired investments, including, but not necessarily limited to, those properties containing
hazardous waste that required the use of agency authority as specified in Article 12.5 (commencing
with Section 33459).
High Business Turnovers and Vacancies/Low Lease Rates/Abandoned BuildinasNacant Lots.
Abnormally high business vacancies, abnormally tow lease rates, high turnover rates, abandoned
buildings, or excessive vacant lots within an area developed for urban use and served by utilities.
Lack of Commercial Facilities. A lack of necessary commercial facilities that are normally found in
neighborhoods, including grocery stores, drug stores, banks, and other lending institutions.
Residential Overcrowdina/Excess Bars, Liquor Stores, Adult Businesses. Residential overcrowding or
an excess of bars, liquor stores, or other businesses that cater exclusively to adults that has led to
problems of public safety and welfare.
High Crime Rates. A high crime rate that constitutes a serious threat to the public safety and welfare.
Tustin Community Redevelopment Agency Page 17
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
The boundaries for the MCAS Tustin Redevelopment Project Area are shown in Figures I-3.
FIGURE I-3
MCAS TUSTIN REDEVELOPMENT PROJECT AREA
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O IR. ,,,. Arr. N.in~:.r. I
,., k,.. j,.„.,,
~ MCAS Tustin Redevelopment
!
,.. ~.... Project Area
Project Area Boundary
Tustin Community Redevelopment Agency Page 18
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
Section II
Five-Year Implementation Plan
for
Non-Housing
Redevelopment Activities
Tustin Community Redevelopment Agency Page ~ 9
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
I1.1 BACKGROUND
MCAS REDEVELOPMENT PLAN
The MCAS Tustin Redevelopment Project Area is comprised of a total of 1,508.6 acres of
property within the City of Tustin including approximately 1,504.5 acres at the former MCAS
Tustin base and 4.1 acres outside the former MCAS Tustin base. The Project Area, referred to
as Tustin Legacy, is located in a heavily urbanized location surrounded by residential,
commercial and light industrial uses. At the time of adoption the Project Area represented
one of the few vacant or significantly underutilized developable tracts of land in central
Orange County.
Former land uses on site before adoption of the Project Area largely consisted of operations
associated with the operation of the Marine Corps base including airfield operations, training,
aircraft maintenance, supply and storage, medical and dental administration, family housing,
bachelor housing, community
support, recreation, and vacant
land. Some of the base was leased
for interim agriculture uses to
private parties.
Land uses for the reuse of the
former MCAS Tustin are those
outlined in the MCAS Tustin Reuse
Plan/Specific Plan adopted
February 2, 2003 by Ordinance No.
1257 as subsequently amended.
Land Uses include low density
residential, medium density
residential, medium high density
residential, transitional/emergency
housing, residential village,
commercial business, commercial,
village services, community core,
educational village, urban regional
park, community park,
neighborhood parks, and schools.
Tustin Community Redevelopment Agency Page 110
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
Lifestyle Center -The District
The MCAS Tustin Redevelopment Plan identifies a number of goals and objectives as follows
in Figure II-1:
Redevelopment Goals and Objectives -MCAS Tustin Project Area
Major goals and objectives for the Project Area as described in the Redevelopment Plan
and the initial Implementation Plan are as follows:
1. The elimination of blighting influences and the correction of environmental
deficiencies in the Project Area, including, among others, (i) buildings in which it is
unsafe or unhealthy for persons to live or work, buildings on land that, when
subdivided or when infrastructure is installed, would not comply with community
subdivision, zoning or planning regulations and buildings that, when built, did not
conform to the then-effective building, plumbing, mechanical, or electrical codes
adopted by the applicable jurisdiction; (ii) factors that prevent or substantially hinder
the economically viable reuse or capacity of buildings or areas; (iii) adjacent or nearby
incompatible and uneconomic land uses; (iv) properties currently served by
infrastructure that do not meet the existing adopted utility or community
infrastructure standards; (v) land containing materials or facilities that will have to be
removed to allow for development such as runways and landing pads; and, (vi)
properties containing hazardous wastes.
2. The assembly of land into parcels suitable for modern, integrated development with
improved pedestrian and vehicular circulation in the Project Area.
', 3. The re-planning, redesign, reuse and redevelopment of portions of the Project Area
which are stagnant or improperly utilized.
4. The provision of opportunities for participation by owners and tenants in the
revitalization of their properties.
5. The strengthening of the economic base of the Project Area by stimulating new
investment and economic growth.
6. The creation of employment opportunities.
7. The provision of an environment for social and economic growth.
The expansion, preservation, and improvement of the community's supply of housing
available to low- and moderate-income persons and families.
The installation of new or replacement of existing public improvements, facilities, and
utilities in areas which are currently inadequately served with regard to such
improvements, facilities, and utilities.
Tustin Community Redevelopment Agency Page 111
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
As noted in Section I, the MCAS Tustin Redevelopment Plan was adopted on June 16, 2003 by
Ordinance 1276. The Redevelopment Plan has been subsequently amended. Figure II-2 is a
summary of the Project Area's description, plan elements, plan limits, and debt capacity.
FIGURE II-2
MCAS TUSTIN REDEVELOPMENT PROJECT AREA DATA SUMMARY
Project Area Size, Location and Characteristics The MCAS Tustin Redevelopment Project
Area is comprised of 1,508.6 acres including
1,504.5 acres that were part of the former
MCAS Tustin base and 4.1 acres that are
located outside the former base boundaries.
Redevelopment Plan Elements Date Ordinance No.
Redevelopment Plan Adopted June 16, 2003 Ord. No. 1276
Redevelopment Plan Amendment No. 1
(descri tion of A enc
p g y programs) April 3, 2007 Ord. No. 1334
Redevelopmerrlt Plan limits
• Last Date to Incur Project Area Indebtedness` July 16, 2023
or from date of Auditor's Certification
• Redevelopment Plan Expiration Date" July 16, 2033
or from date of Auditor's Certification
• Last Date to Receive Project Area Tax Increment"' July 16, 2048
• Expiration Date for Eminent Domain Authority"" 12 years from effective date of ordinance
1276 or July 16, 2048;
modified to June 13, 2015
• Total Amount of Permitted Bonded Debt $180,000,000 would be outstanding at any
one time
• Maximum Amount of Tax Increment $833,000,000 (100%)
• The Agency shall not establish or incur loans, advances, or indebtedness to finance in whole or in part the Project beyond
20 years from the date the County of Orange Auditor makes its certification pursuant to Section 33492.9 of the CRL. Loans,
advances, or indebtedness may be repaid over a period of time beyond said time limit. This time limit shall not prevent the
Agency from incurring debt to be paid from the low and Moderate Income Housing Fund or establishing more debt in order
to fulfill the Agencys housing obligations under Section 33413 of the CRL.
''County Auditors Certificate per Redevelopment Plan
"'Redevelopment Plan Expiration Date and Last Date to Receive Project Area Tax Increment may be extended for one year
for each year ERAF Payment is made to State pursuant to Health & Safety Code Section 33333.6 (revised per SB1045).
"''Per Ordinance No. 1334
Tustin Community Redevelopment Agency Page 112
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
11.2 MAJOR ACCOMPLISHMENTS
1. Acquisition and Disposition of Property in Project Area
The Agency has been responsible for administering the conveyance, development and leasing
of all City-owned properties conveyed to the City by the Navy under the terms and conditions
of an Economic Development Conveyance Agreement approved in 2002. Since 2002, all
properties conveyed to the City by the Navy ("City owned properties") intended for
conveyance or leasing to private entities, public agencies, and non-profit institutions have
been committed through conveyance agreements, disposition and development agreements
or interim lease agreements intended for eventual conveyance, as appropriate.
The status of those dispositions is detailed as follows, including the highlights identified in
Figure II-3:
Highlights During Initial Implementation Plan
Residential Uses Constructed: 765 dwelling units constructed of a potential 4,210 dwelling
units permitted per MCAS Tustin Specific Plan.
Commercial Uses Constructed: 1 million square feet of retail space within a regional Class A
retail center.
Educational Uses: Two community college districts have completed campus improvements
including the Rancho Santiago College Law Enforcement Training Facility and Phase 1 of the
South Orange County Community College Advanced Technology Education Campus.
Transitional Housing: Orange County Rescue Mission has completed a transitional
homeless facility, known as the Village of Hope, that contains 192 residential units.
Total Valuation and Tax Increment: New development has generated $924M in assessed
valuation to date and over $lOM in tax increment.
Land Dispositions: Private transactions have a land purchase price value of $332.2 million
dollars, plus additional back-side profit participation on all transactions.
Jobs Created: To date, over 4,155 construction jobs have been generated and 2,055
permanent jobs.
• Regional Retail Site f;The District at Tustin Legacy) The City conveyed 87 acres to
Vestar/Kimco Tustin, L. P., for development of The District at Tustin Legacy, a 1,006,000
square foot regional Class A retail center, located at the northwest corner of Jamboree
Road and Barranca Parkway. The Specific Plan/Reuse Plan authorized up to 1,006,000
square feet of regional retail uses on this site. The developer opened the center in May
2007; most of the vertical improvements on the restaurant pads were completed during
2008.
Tustin Community Redevelopment Agency Page 113
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
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The District -Master Plan
• Tustin Master Development (Legacy Park at Tustin Legacy)
The City entered into a Disposition and Development Agreement (DDA) with Tustin
Legacy Community Partners LLP (TLCP) in April 2006 for the development of
approximately 820 acres. Of the total 820 acres the land uses are distributed as follows:
185 acres as residential, 234 acres as non-residential including office and retail, and 403
acres for open space and _ ~- ~ _ _ _ _
institutional uses such as i ~~(~~Ns; ~ ,~, '°' ~ ,u.t'
schools. The DDA is ~• ` _ '_- ~ 1~ .~ "`"
performance based "° ~ - -nom// 4~~.
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t tri M I ....P
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conveying parcels by phase . ._ ~ _~
based on development _ ~'" ='°` ''` "`i "~ )
progress. In June 2007, the ~i.. '' ter . . 1': e~
first phase, consisting of & ~!Ij`-. °J~ W l " ~' ~ ~F~ ~,,
approximately 320 acres, I _, w~ _-.,;~ _
was conveyed to TLCP for ~ =°~ w~~L"''\ ~ _
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development including the .. N - °-
~.
following uses: residential, ~ `° ~~ ~ _ ~
office, retail, and open ~ + ~'
space, and public
infrastructure.
Tustin Community Redevelopment Agency Page 114
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
• Residential Vertical Builders
Tustin Fields I and II (W.L. Homes, dba John Laing Homes): The City disposed of
approximately 67 acres for the development of 565 residential units of which 118 or
21% were affordable units. Construction and occupancy of the units was completed
in the years 2004 through 2006.
.~ .
. '~
f~
i~ :~
Villages of Columbus (Marble Mountain Partners, LLC and Moffett Meadows
Partners, LLC): Approximately 229 acres were conveyed by the Navy through a public
bid sale to Marble Mountain Partners, LLC and Moffett Meadows Partners, LLC. Of
the approximately 229 acres, approximately 161 acres are in the Project Area. Of the
1,390 approved residential units within the Project Area within Villages of Columbus,
approximately 800 have completed to date.
• Public and Institutional including Non-Profit Conveyances.
Approximately 67 acres on the west side of the Project Area, within the Education Village,
have been designated in the Specific Plan/Reuse Plan and Redevelopment Plan for
institutional uses and have been conveyed as follows:
Tustin Community Redevelopment Agenty Page i 15
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
a. South Orange County Community College District (SOCCCD): 37.66 acres
conveyed by quit claim deed and 30.71 acres by sublease. Both the conveyance
and lease agreements are between the City and SOCCCD.
b. Rancho Santiago Community College District (RSCCD): 15 acres conveyed by quit
claim deed. The conveyance agreement was between the City and RSCCD.
c. Orange County Rescue Mission (OCRM): 5.1 acres conveyed by quit claim deed.
The property was conveyed pursuant to a settlement agreement between the City
and OCRM.
d. Transitional Housing: The City has secured the transfer of 18 newly constructed
units to three homeless providers within the Project Area: 6 units to the Salvation
Army, 6 units to Human Options, and 6 units to Orange Coast Interfaith Shelter.
All conveyances were at no cost to the homeless provider. The City has also
secured a 16 unit apartment complex for a homeless provider, the Salvation
Army, off-site, at no cost. These transactions were conducted in partnership with
WL Homes (dba John Laing Homes) and Lennar/William Lyon Homes.
e. County of Orange (Social Services Agency): 4 acres were conveyed directly from
the Federal Department of Human Health Services (HHS) to the County of Orange
Social Services Agency in 2006.
f. Tustin Unified School District (TUSD): 10-acre elementary school site, adjacent to
Red Hill Avenue, was conveyed directly from the Federal Department of Education
to the Tustin Unified School District in 2003. Additionally, the City in 2008,
prepared Conveyance Agreements for the development of a future high school
site (40-acre) and a future elementary school site (10-acre). Conveyance of these
sites, by the City to TUSD, is anticipated to occur by the end of calendar year
2008.
The Agency did not acquire any land in the Redevelopment Project Area during the term
of the initial Implementation Plan.
2. Demolition/Clearance and Site Preparation
A considerable amount of demolition has been completed and will continue to occur in
the overall redevelopment of the former MCAS Tustin base. During the initial
Implementation Plan significant demolition was conducted on the site of the former
MCAS Tustin Marine base which included the removal of runways and tarmac, demolition
of obsolete and substandard buildings and residential units, and demolition of existing
roadways and utility systems. Much of the demolition, clearance and site preparation
was accomplished as a condition of the Disposition and Development Agreements
Tustin Community Redevelopment Agency Page 116
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
between the developers associated with the designated sites to accommodate new
developments.
Over 80% of all materials generated as a result of demolition from the former base are
also recycled on-site and are used in the new construction of public and private streets.
3. Public Improvements and Facilities
During the initial term of the Implementation Plan, over $130 million dollars of
infrastructure and related capital improvement projects were completed. In addition,
$300 million of improvements are under design. Work has been completed on the
following Tustin Legacy roadways with all related utility systems, including storm drains,
dry utilities, and traffic control improvements.
Infrastructure Improvements Completed:
• Kensington Park Road (formerly known as the West Connector)
• Valencia Avenue -Red Hill Avenue to Kensington Park Road
• Lansdowne Avenue
• Edinger Avenue -From approximately 1400 East of Red Hill to Harvard Avenue
• Armstrong Avenue -Valencia Avenue to future Warner Avenue
• Severyns Road
• Park Avenue (formerly known as South Loop Road) - Warner to Tustin Ranch Road
• Tustin Ranch Road -Warner Avenue to Barranca Parkway
• Warner Avenue -Tustin Ranch Road to Jamboree Road
• Modification to Warner Ramp at Jamboree Road and the transition area of the west
leg of the Eastern Transportation Corridor.
4. Environmental Remediation Activities
After the 1991 announcement that MCAS Tustin would close, the Navy pursuant their
responsibilities as the occupant of the base, commenced remediation of military
contaminants to support reuse of the property as approved in the MCAS Tustin Specific
Plan. Hundreds of sites at the former Marine facility have been investigated, documented
and remediated, as needed. Agency staff actively participates with Navy staff and state
and federal regulatory agencies (United States Environmental Protection Agency,
California Environmental Protection Agency/Department of Toxic Substances Control and
Regional Water Quality Control Board) in reviewing and commenting on Navy
remediation documents, and providing recommendations to assist the Navy in selecting
remedies that support rapid economic development and reuse at the site.
Since adoption of the initial Implementation Plan, the Navy has continued to make
significant progress on several major initiatives to resolve MCAS Tustin's remaining
Installation Restoration Programs. During this period, significant progress was made in
investigating and remediating the Operable Units (OUs), IRP sites, and Resource
Tustin Community Redevelopment Agency Page 117
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
Highlights include:
• OU-1A - Progress was made to remediate primarily TCP 1, 2, 3 and MTBE
groundwater contamination plumes at OU-lA and Underground Storage Tank (UST)
Site 222 utilizing two groundwater pumps and treat systems including the removal of
hot spots in soil that previously served as the source of the site's groundwater
contamination. Construction of the final treatment system was completed in
November 2007 and has been operational since December 2007.
• OU-16 -Progress was made to remediate primarily TCE groundwater contamination
plumes at OU-1B. Construction of the final treatment systems were completed in
November 2007 (North treatment system in Carve-Out 5) and December 2007 (South
treatment system in Carve-Out 6) and have been operational since December 2007
and January 2008, respectively.
• OU-46 - On August 23, 2005, the Navy issued a Draft Feasibility Study (FS) that
identified a number of optional methods to remediate primarily TCE groundwater
contamination at OU-46. A revised Draft FS was released in March 2008.
Tustin Community Redevelopment Agency Page 118
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
Conservation and Recovery Act areas of concern (ADCs). The remaining AOCs are shown
below:
• The Agency has actively participated with the Restoration Advisory Board (RAB) and
Base Cleanup Team to support continued monitoring of Navy remediation activities
and the land use restriction covenants placed within portions of the Project Area.
• Supported economic development and reuse within the site through the abatement
of hazardous materials (primarily asbestos and lead-based paint) that impede
demolition and replacement of buildings and facilities in the Project Area.
5. Administrative Program Support and Indirect Costs
While the Agency continues to provide oversight and management for all redevelopment
activities in the Project Area, a portion of the estimated administrative support and
indirect costs associated with the project oversight during the implementation period has
been largely covered by funding sources in addition to a small amount of tax increment
revenue. Land sale proceeds deposited into the MCAS Tustin Legacy Enterprise Fund, as
provided for under the Economic Development Conveyance agreement between the
Navy and the City of Tustin, account for a substantial portion of the funding during the
early years of the project. In addition, the City is recovering some administrative costs
from developers.
6. Adopted Project Area Benefit Resolutions
The following resolutions were adopted during the period of the initial Implementation
Plan that demonstrated benefit and enhancement to the Project Area.
• City Council Resolution No. 03-78 making the finding that the expenditure of Low and
Moderate Housing Set-Aside Funds is of benefit to the MCAS Tustin Project Area and
authorizing the expenditure of such funds Citywide.
• RDA Resolution No. 03-10 (Low and Moderate Income Funds outside the Project
Area): This resolution found benefit to the Project through the use of low and
moderate income funds outside the Project Area in eliminating blighting conditions.
• RDA Resolution Nos. 07-01, 07-02, 07-03 (Newport Avenue and Edinger
Improvements): These resolutions found benefit to the Project in eliminating blighting
conditions through the acquisition of property and right-of-way necessary to
construct the Phase I Newport Avenue Extension/Northbound SR-55 ramp
reconfiguration/Edinger Avenue Widening Project Improvements. The acquisition
and improvements were identified in the Joint Final Environmental Impact
Statement/Environmental Impact Report for the disposal and reuse of the Tustin
Marine Corps Air Station as necessary to provide primary arterial access to the MCAS
Tustin Redevelopment Project Area.
Tustin Community Redevelopment Agency Page 119
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
11.3 NON-HOUSING PROGRAM FINANCIAL RESOURCES
The Agency's implementation activities are based on the availability of funding from existing
fund balances, bond proceeds and estimated future tax increment revenues not previously
committed to existing financial obligations. While it was indicated that Implementation Plan
goals and objectives, programs, specific projects and expenditures could assist in eliminating
blight within the Project Areas, private sector investment will additionally contribute to the
removal of blight.
In the initial Implementation Plan, the Report to the City Council for the Redevelopment Plan
identified that substantial infrastructure and administrative support costs would be required.
The Report identified that tax increment revenues generated from the Project Area would not
be sufficient during the initial years to cover the anticipated costs. The Report also identified
that while the feasibility analysis for the Project Area assumed the use of tax increment
revenues to finance the anticipated redevelopment programs over the 30-year life of the
Project, other potential revenue sources legally available to the Agency may be used. These
additional resources included tax allocation bond proceeds, loan proceeds, land sale
proceeds, Mello Roos or other special assessment district financing, and developer
infrastructure fee payments.
Revenues
To date, a combination of tax increment revenues, loan proceeds, federal grants, land sale
proceeds, Community Facility District (CFD) financing, developer advances, and Tustin Legacy
backbone infrastructure fee payments from developers have been used to fund
implementation activities in the Project Area. This combination of resources may be
expanded in future years depending on the needs and timing of the Project Area's activities.
Net tax increment revenues available to fund non-housing programs, projects and
expenditures of the Agency were identified as estimates in Exhibit 15 of the initial Five-Year
Implementation Plan. Net tax increment revenues are projections after the Agency's 20%
deposit to the low and moderate income housing set-aside fund, County administrative fees,
and statutory pass-through to other taxing agencies (approximately 20% with additional pass-
thru required to educational institutions in year 11 of the Project Area). They include tax
increment, revenue from bond proceeds, land sales, prior loan repayments, interest earnings,
and new loans to the Agency.
It is estimated that as of June 30, 2008, there will be a starting capital fund balance of
approximately $33,800,000. As shown in Figure II-4, approximately $83,200,000 in net non-
housing tax increment will be generated over the next five years to fund non-housing projects
and programs and expenditures over the Implementation Plan's time frame. The funding for
affordable housing activities is discussed in the housing section of this Implementation Plan.
Tustin Community Redevelopment Agency Page 120
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
11.4 EXISTING DEBT OBLIGATIONS (NON-HOUSING AND HOUSING)
The existing financial obligations for the MCAS Tustin Project Area as shown in Table II-4 are
as follows:
• Debt -Tax Allocation Notes ($25M)
On April 1, 2007, the Agency entered into two related Note Purchase Agreements in
the amount of $19,900,000 Series B (Tax-exempt) and $5,100,000 Series A (Taxable)
with Citigroup Global Markets, Inc. for the acquisition of a 37 acre parcel in the
vicinity of the SRSS ramp area/Edinger Avenue within the South Central Project Area.
The land was found to have benefit to the MCAS Tustin Project Area (RDA Resolution
Nos. 07-01, 07-02, 07-03), as necessary for the acquisition and implementation of the
Phase I Newport Avenue Extension Project. Principal is payable in annual payments
due in November of each year, for five years with the term of the notes ending in
November 2012. Interest payments are payable monthly during the Initial Note
Period with a fixed interest rate of 4.3% through November 2008. After the Initial
Note Period, variable rate interest payments are payable monthly, not to exceed 12%
annually. The Notes are secured by tax increment revenue generated within the
MCAS Tustin Project Area. In addition, proceeds from sale of land are pledged to the
repayment of the notes.
• Set-Aside of Low and Moderate Income Housing Purposes
Section 33334.2(a) of the CRL requires that that not less than twenty percent (20%) of
annual gross tax increment revenue be set-aside to facilitate the development of
housing for persons with low and moderate incomes. The Agency may choose to
expend more than the mandatory 20% on an annual basis, as determined necessary,
to meet existing affordable housing obligations. Particulars regarding the estimated
amount and planned usage of the set-aside funds are described in the Housing
Section of this Implementation Plan.
• Affordable Housing Reimbursement Agreement
On June 5, 2007 the City of Tustin and the Tustin Community Redevelopment Agency
entered into a reimbursement agreement for related housing responsibilities to be
assessed the Agency (the "Reimbursement Agreement"). The agreement will
reimburse the City for advancing funds to assist the Agency in carrying out its
affordable housing obligations (Housing Affordability Subsidy) under MCAS Tustin
Redevelopment Plan (see further discussion under the Reimbursement Agreement).
The total reimbursement obligation, under the reimbursement agreement, by the
Agency to the City general fund is $46,407,736 in subsidizing 118 units in Tustin Field I
and II; the reimbursement is proposed to be paid to the City over a 25 year period at
annual interest rate of 5.00% under the current debt service schedule which can be
Tustin Community Redevelopment Agency Page 121
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
modified on an annual basis by the City's Finance Director and City Manager in
conjunction with the annual budget process. The Agency's annual obligation is
estimated at approximately $3.2M which can be accelerated and will likely include an
additional $3.2M annually from the 80% non-housing monies. It is estimated that the
Agency's Housing Affordability Subsidy may grow up to an additional $62,296,000
during the term of the Second Implementation Plan requiring modification or a new
reimbursement agreement.
• Overhead Reimbursement for City's Cost
Funds advanced by the City for operating expenses, support services and capital
improvements will be reimbursed to the City on an annual basis in conjunction with
the budget adoption process.
Tustin Community Redevelopment Agency Page 122
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
11.5 AGENCY FIVE YEAR NON-HOUSING IMPLEMENTATION ACTIVITIES
II.S.1 INTRODUCTION
Non-housing implementation activities for the Project Area will be associated with the
following major areas:
1. Acquisition, Disposition, and Development Coordination Program
2. Public Improvements & Facilities
3. Demolition/Site Clearance
4. Economic Development
5. Environmental Remediation
6. Administrative Program Support and Indirect Costs
These programs often coincide and are overlaid to produce a successful project.
Infrastructure and community facility improvements may work in concert with a private
development project to ensure that the desired objective is achieved. Projects may vary
dramatically during the next five years in reaction to market conditions and private
development interest, but the main areas shown above will remain the focus of the Agency.
The Agency's five-year implementation activities are based on the availability of funding from
existing fund balances, developer advances, bond proceeds, and future tax increment
revenues not previously committed to existing financial obligations. In addition, financial
resources from other City, State and Federal programs, including but not limited to,
Community Development Block Grant (CDBG) and capital improvement project funds may be
used, if available, to assist in implementing the Agency's projects and programs.
The proposed projects, programs and the corresponding expenditures over the five-year
implementation period are designed to achieve the Goals and Objectives of the
Implementation Plan and assist in the elimination of blighting conditions.
The funding of the programs identified in this Plan is greatly influenced by economic
conditions and the ability of the private sector to respond to Agency initiatives. Projects and
expenditures rely on the private sector's ability to obtain funding, as well as the Agency's
ability to maintain and increase tax increment revenues. If the Agency's revenues are
depleted because of higher than projected expenditures or new requirements imposed by
the State, it is unlikely that all of the projects and/or programs listed will be implemented.
In order for the Implementation Plan's Goals and Objectives to be achieved, the projects,
programs and expenditures outlined in this Second Implementation Plan will need to be
implemented. The relationship between the Goals and Objectives of the Implementation
Plan to eliminate blight conditions, and the projects, programs and expenditures outlined in
Tustin Community Redevelopment Agency Page 123
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
the Implementation Plan are described at the end of Section IV and in Figure IV-1. Private
sector activities will additionally contribute to the removal of blight within the Project Area
and the revitalization of the Project Area.
11.5.2 CASH FLOW
An illustrative five year cash flow for non-housing activities is provided in Figure II-4 which
includes the proposed programs and project expenditures that are identified in the following
section detailing the five year implementation activities.
•
- ..
i~r •.
Plan Yesr
Projected 6 7 8 9 10
Fund
Balance (6- 2008-09 2009-SO 2010.11 2011-12 2012-13 Cumulative
1. Revenues
fund Balance' $ 33,842 33,842 8,935 (23,349) (22,090) (17,750) (20,411)
Non-Housing Tax Increment ~ 9,918 14,693 16,576 20,100 21,949 83,235
Interest Earnin s' 413 541 791 1,073 1,417 4,235
Total -Gross Revenues: $44,173 $ 24,168 $ (5,982) $ (917) $ 5,616 $ 67,059
2. Expenses
(Less) Tax Allocation Note ($25M) -Debt Service Payment'
Principal 4,046 5,992 6,763 8,199 25,000
Interest 1,506 2,128 1,752 765 6,152
Total - P&1 5,552 8,120 8,515 8,964 31,152
(Less) Housing Reimbursement Agreement ($46M) ° 3,293 3,293 3,293 3,293 3,293 16,465
(Less) Housing Reimbursement Agreement ($62M) ° TBD TBD TBD TBD TBD -
Less Projects Pro rams s 26,393 36,104 4,299 4,576 3,992 75,364
Total -Expenses $ 35,238 $ 47,517 $ 16,107 $ 16,833 $ 7,285 $ 122,981
3. Net Available $ 33 842 $ 8,935 $ 23,349 22 090 17 750 $ 1 669 55,922
Notes:
1. Projected Fund Balance: based on adopted City budget for FY08-09 includes: (1) Fund 54, Marine Base Debt Service, $9,089,302; (2) Fund 55,
Marine Base RDA, $24,752,710.
2. Non-Housing Tax Increment and Interest Earnings: projections based on analysis conducted by David Taussig & Associates in 2005.
3. Tax Allocation Notes ($25M): The debt schedule is per agreement with Citigroup Global Markets, Inc., the lender.
4. Affordable Housing Reimbursement Agreements: Both housing set-aside funds and non-housing net tax increment will be used to meet the
debt obligation for the Affordable Housing Reimbursement Agreement ($46M). The Agency may reimburse the City for affordable housing
in an amount of $62M; this phase of affordable housing is not anticipated to coming online until 2011-12. Annual payments can be modified
on an annual basis; the debt repayment may be accelerated. Total annual debt service payments are anticipated to range from
approximatley $3.2M to $12M.
5. Projects/Programs: Based on anticipated annual program expenditures. Expenditures on these projects/programs will be determined on an
annual basis based on source of funds, need, and timing. The detail for the Projects/Programs is shown in Figure II-5.
The term "Illustrative" is an example and is not intended to be limiting on the Agency's activities.
Tustin Community Redevelopment Agency Page 124
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
11.5.3 FIVE YEAR PROJECTS, PROGRAMS, AND EXPENDITURES
1. Acquisition, Disposition and Development Coordination Program
During the initial term of the Implementation Plan, the Agency staff administered
acquisition, disposition and development coordination activities of City-owned properties
in the disposition and development of parcels throughout the Tustin Legacy project. The
Agency staff, during the term of the Second Implementation Plan, will continue in its role
in acquisition, disposition, and coordinating development activities with the appropriate
developers and City operating departments. Issues associated with the disposition of
properties and management oversight of the activities will also be performed including
leasing, licensing, property management, and site preparation. Market conditions will
impact of the ability disposition to occur within the term of the Plan. The Agency is
anticipated to coordinate with the City as follows:
a. Disposition and Development Agreements (DDA) with the City of Tustin
during the initial term of the Implementation Plan, entered into four DDAs.
^ Vestar/Kimco Tustin L.P. (The District at Tustin Legacy)
Convey 3.96 acres currently ground leased to Vestar/Kimco Tustin LP, the
current lessee. The City is currently leasing the property from the Navy;
conveyance is conditioned upon the Navy's remediating specific
environmental conditions impacting the site. The lease is conditioned with
significant obligations that are not expected to conclude until 2010-2011. The
Agency is responsible for all development coordination activities associated
with the terms and conditions of the DDA.
• Tustin Legacy Community Partners, LLC (Master Developer)
A total of 820 acres will be conveyed over four phases. In June 2007, the first
phase, consisting of approximately 320 acres, was conveyed to TLCP for
development including the following uses: residential, office, retail, and open
space, and public infrastructure. The remaining acreage is anticipated to be
disposed of in Phases 2, 3, and 4 during the term of the Second
Implementation Plan based on TLCP meeting specified performance
measures. Leased parcels (LIFOC) will not be conveyed until the Navy has
fulfilled environmental remediation conditions that make the site suitable for
transfer. The Agency is responsible for all development coordination activities
associated with the terms and conditions of the DDA.
Tustin Community Redevelopment Agency Page 125
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
^ WL Homes (dba John Laing Homes)
In March 2003, 29.4 acres (Tustin Field I) was conveyed for the construction of
376 residential units of which 78 were affordable units, and in May 2003 an
additional 36.8 acres (Tustin Field II) was conveyed for the development of
189 residential units of which 40 were affordable units.
b. Community Facilities District Financing and Related Assessment Financing
The Agency staff will coordinate with City departments, including the City's
Finance Department, in seeking Community Facility District (CFD) financing and
related assessment district financing as appropriate for new development within
the Project Area. During the initial term of the Implementation Plan, the Agency
participated in coordinating financing for three CFD totaling approximately $78M
(CFD 04-01 $11,415,000; CFD 06-01 $53,570,000; CFD 07-01 $13,680,000). It is
anticipated that approximately $170M will be financed during the term of the
Second Implementation Plan.
c. Development Coordination in Project Area
The Agency staff will be responsible for overall development coordination within
the Project Area and the Tustin Legacy project. This development coordination
role will include all sites and parcels with Tustin Legacy.
d. Solicitation of Existing City-owned Site (18.5 acres)
Solicit interests in the development of a City-owned site located in the western
portion of the Project Area. In addition to solicitation of interests, the Agency will
be responsible for all development coordination activities associated with the site.
The property is bounded by Red Hill Avenue on the west, Valencia Avenue on the
north, Warner Avenue on the south, and the SOCCCD property on the east. The
schedule for solicitation and disposition will take into consideration market
conditions that are in the City's and Agency's best interest.
e. Interim Leasing and Licensing
The Agency will administer the leasing and licensing of City-owned properties in
the Tustin Legacy project. Some of the leased parcels will be conveyed when
environmental conditions have been remediated and the properties are found
suitable for conveyance by the Navy. Licensing of City-owned properties will be
done on an interim basis to address temporary needs related to the development
of Tustin Legacy.
f. Acquisition of Parcels currently Leased from Navy
Acquire leased parcels, also known as LIFOC parcels (Lease in Furtherance of
Conveyance), from the Navy as part of the Economic Development Conveyance to
Tustin Community Redevelopment Agency Page 126
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
the City. Some of these parcels will be retained by the City for community
facilities or infrastructure, while other LIFOC parcels will be conveyed to
developer under the terms and conditions of existing DDA, as previously noted.
These parcels are as follows:
^ City Parcels: 1) a 24 acre community park, and 2) a 2.4 acre site containing a
former child care center. The Agency is responsible for development
coordination on these sites.
^ TLCP Parcels: 1) a 32.2 acre site, known as Carve-Out Area 6, with a
designated commercial land use; 2) 39.33 acres known as a portion of Carve-
Out Area 5; and, 3) a 2.17 acre site, known as Carve-Out Area 9. The Agency is
responsible for development coordination on these sites.
^ SOCCCD Parcels: 31 acres are currently located in LIFOC area; the parcels are
leased from the City to SOCCCD. The leased parcels are part of a larger site of
68 acres; 37 acres has been conveyed. The conveyance is subject to South
Orange County Community College District (SOCCCD) complying with the
terms and conditions of the Conveyance Agreement.
^ Vestar/Kimco Tustin Parcel: 3.96 acres are currently located in a LIFOC area.
This is part of an 87 acre conveyance. The Agency is responsible for
development coordination on these sites.
2. Public Improvements & Facilities
The Agency will participate and coordinate the planning, design, and construction of
public infrastructure improvements and community facilities. The projects listed below
are currently proposed and may change during the term of the Implementation Plan,
these changes will depend be the result of the of the following: market conditions; site
conditions discovered during facility planning; identified community needs; and, the need
to eliminate blight conditions.
Currently the Agency has identified an estimated $407M of public infrastructure needs
known as "backbone infrastructure", within the Project Area or of benefit to the Project
Area. These improvements include roadways, bridges, traffic signals, traffic mitigation
(FEIS/EIR), drainage improvements, water quality improvements, dry utilities, public
parks, and community facilities. A comprehensive list of potential projects is attached as
Appendix B, Public Infrastructure and Community Facilities. A few of the anticipated
projects from that list, as well as these infrastructure projects, are highlighted in the
discussion that follows. Most of the projects highlighted will receive direct Agency
funding with the potential that Agency funding may also be needed for other projects
Tustin Community Redevelopment Agency Page 127
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
listed in Appendix B; in likelihood, the funding would be needed for cost overruns or
unknowns discovered during design.
• Tustin Ranch Road and Bridge Project -assist in the design, construction, and
acquisition of right-of-way associated with the extension of Tustin Ranch Road from
Wa-nut Avenue to Warner Avenue.
• Valencia/Armstrong Roadway Project -assist in the design and construction of the
two remaining portions located in the southwest portion of the Project Area
(Armstrong Avenue -Barranca to Warner), and the northeast portion (Valencia
Avenue -Kensington to Moffett). Construction of these roadways will open parcels
for the development of residential and commercial uses. Armstrong is a major
north/south arterial and Valencia is a major east/west arterial.
• The District at Tustin Legacy Infrastructure Project - assist in the design and
construction of the remaining portions of new infrastructure and the expansion of
existing systems including roadways, storm drains, and utilities, including
infrastructure in Warner Avenue and Barranca Parkway. This infrastructure will serve
the new regional retail center, The District at Tustin Legacy, and the western portion
of the Project Area.
• Red Hill Median -assist in the design and construction of median improvements
associated with the widening of Red Hill Avenue, a roadway adjacent to the western
boundary of the Project Area.
• Phase I Newport Avenue Extension/Northbound SRSS Ramp Reconfiguration /Edinger
Avenue Widening Project Improvements (referred to as Phase I Newport Avenue) -
acquisition of a 37 acres necessary for construction of Phase I Newport Avenue within
the South Central Project Area. Although this project is in the South Central Project
Area, the land was found to have benefit to the MCAS Tustin Project Area as a result
of traffic generation from new development within the MCAS Tustin Redevelopment
Project Area. A resolution, RDA Resolution No. 07-01, finding benefit to the Project
Area was adopted by the Agency in 2007. It is anticipated because of the scope and
schedule that as the project proceeds additional acquisition monies will be necessary
above the initial project estimates.
• Tustin Legacy Community Park (24 acres) - planning, design, environmental
assessment of existing buildings for adaptive reuse, environmental assessment of
existing contamination plumes with Navy clean-up efforts, and construction of a
community park to be owned and operated by the City of Tustin.
Tustin Community Redevelopment Agency Page 128
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
• Tustin Legacy Park (86 acres) -planning, programming, design, and construction of
public athletic facilities, recreation facilities, open space areas, and trails, bicycle
paths, and walkways.
• Fire Station (8,500 sq. ft. building on 1.25 acres) -planning, design and construction
of a fire station. The fire station facilities and land will be owned by the City and
leased to the Orange County Fire Authority. The facilities will service development in
the Project Area.
3. Demolition/Site Clearance
The Agency will participate in demolition and site clearance activities throughout Tustin
Legacy to prepare sites for development by private and public entities.
4. Economic Development Programs
The Agency will initiate and participate in economic development programs in
conjunction with the business community in the creation of jobs, and the growth and
retention of businesses within the Project Area. The Agency will be instrumental in
business attraction.
• Business Promotion and Attraction: Property owner and tenant assistance programs
that promote and support new commercial development within the Project Area
particularly businesses that are high job generators such as retail uses, office uses,
and R&D uses. Expenditures would include, but not be limited to brochures, digital
media, and marketing materials.
• LAMBRA: Assist business owners eligible for benefits under the Local Agency Military
Base Recovery Act (LAMBRA). LAMBRA benefits include: 1) state tax benefits such as
15-year net operating loss carry-over; 2) business expense deductions; 3) sales and
use tax credits; 4) hiring tax credits; and, 5) preference points on state contracts.
5. Environmental Remediation
The Agency is engaged in mitigation activities associated with environmental impacts in
the Project Area and environmental impacts found to have a benefit to the Project Area
that are outside the Project Area. The Agency is also engaged in on-site mitigation
activities with the Navy as part of the Economic Development Conveyance process.
City of Tustin staff actively participates with Navy staff and state and federal regulatory
agencies (United States Environmental Protection Agency, California Environmental
Protection Agency/Department of Toxic Substances Control and Regional Water Quality
Control Board) in reviewing and commenting on Navy remediation documents, and
providing recommendations to assist the Navy in selecting remedies that support rapid
economic development and reuse at the site, including specialized legal services
associated military base closures and hazardous clean-ups.
Tustin Community Redevelopment Agency Page 129
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
6. Administrative Program Support & Indirect Costs
The Agency may also make payments to reduce the Low and Moderate Income Housing
reimbursement agreement obligations, if additional tax increment funds are available
from the non-housing (80%) funds during the Plan's five year period. Funding available
and distribution is determined on an annual basis by the City's Finance Director and the
City Manager as part of the annual budget process.
Administrative and indirect costs will be ongoing during the term of the Plan. The
services include, but are not limited to, the following:
• Security Services -contracted services for protection of City-owned properties at
Tustin Legacy that will be developed during the term of the Plan.
• Security Lighting -lighting associated with securing City-owned properties at Tustin
Legacy that will be developed during the term of the Plan.
• Due Diligence activities -third party and in-house services associated the disposition
and development of sites located at Tustin Legacy.
• Legaf Services -comprehensive legal services related to activities within the Project
Area and activities outside the Project Area in which a finding of benefit has been
established including City Attorney services and Special Counsel.
• Management of Assets - in-house and contracted third party legal services.
• Planning and Design - in-house and contracted third party services associated with
planning and design activities.
• Leasing of Office Space and Equipment
• Telephone
• Printing
• Audit/Accounting
• Office Materials and Supplies
• Meetings and Training
• Membership Dues and Subscriptions
• Computer Software and Hardware
To support the major areas of the Implementation Plan, direct administrative costs, and
indirect costs including consulting and legal expenses will also be incurred, as shown in
Figure II-5.
Tustin Community Redevelopment Agency Page 130
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
6 7 8 9 10
1 Acquisition, Disposition, and Development Coordination
Vestar/KimcoTustin(TheDistrictatTustinLegacy) 143,360 37,085 38,940 40,890 20,445 6,000
Tustin LegacyCommunityPartners 2,234,075 385,000 740,000 345,545 557,994 205,536
WLHomes (Tustin Field I and II) 5,000 5,000 - - - -
Lennar/Lyon (The Villages of Columbus) 45,000 15,000 15,000 7,500 5,000 2,500
Newport Extension' 20,000,000 10,000,000 10,000,000 - - -
Solicitation Process - 18 acre site 290,000 40,000 150,000 50,000 25,000 25,000
Interim Leasing and Licensing 37,500 7,500 7,500 7,500 7,500 7,500
Parcel Acquisition activities associated LIFOCparcels 189,300 50,600 50,600 50,600 25,000 12,500
Total -Acquisition, Disposition, and Development Coordination $ 22,944,235 $ 10,540,185 $ 11,002,040 $ 502,035 $ 640,939 $ 259,036
2 Public Improvements and Facilities
General Oversight 4,691,283 413,510 1,461,475 1,264,070 1,052,228 500,000
Tustin Ranch Road 1,106,191 1,106,191 - - - -
Valencia/Armstrong 25,000 25,000 - - - -
The DistrictatTustin Legatylnfrastructure 30,000,000 10,000,000 20,000,000 - - -
Red Hill Avenue Median Improvements 2,500,000 2,500,000 - - - -
TustinLegacyPark-24acre Community Park 1,557,765 - 1,557,765 - - -
Total -Public Improvements and Facilities $ 39,880,239 $ 14,044,701 $ 23,019,240 $ 1,264,070 $ 1,052,228 $ 500,000
3 Demdition/Site Clearance
Site Preparation and Demolition 380,000 180,000 50,000 50,000 50,000 50,000
Total -Community Facilities $ 380,000 $ 180,000 $ 50,000 $ 50,000 $ 50,000 $ 50,000
4 Economic Development
Business Attraction, Growth and Retention Program 639,600 127,920 127,920 127,920 127,920 127,920
LAMBRA Promotion and Monitoring Program 250,000 50,000 50,000 50,000 50,000 50,000
Total -Community Facilities $ 889,600 $ 177,920 $ 177,920 $ 177,920 $ 177,920 $ 177,920
5 Environmental Remediation
Special Studies and Monitoring 150,000 30,000 30,000 30,000 30,000 30,000
Legal Services 125,000 25,000 25,000 25,000 25,000 25,000
Total -Environmental $ 275,000 $ 55,000 $ 55,000 $ 55,000 $ 55,000 $ 55,000
6 Administrative Program & Indirect Costs n
Administrative Program Costs 6,250,000 $ 750,000 $ 1,000,000 $ 1,250,000 $ 1,500,000 $ 1,750,000
Overhead/Indirect Costs 4,745,000 $ 645,000 $ 800,000 $ 1,000,000 $ 1,100,000 $ 1,200,000
Total - Admin Program & Indirects $ 10,995,000 $ 1,395,000 $ 1,800,000 $ 2,250,000 $ 2,600,000 $ 2,950,000
TOTAL NON-HOUSING PROGRAMS $ 75,364,074 $ 26,392,806 $ 36,104,200 $ 4,299,025 $ 4,576,087 $ 3,991,956
Notes: This budget will be modified on an annual basis to accommodate changes in the mitigation of blight conditions, changes in revenues, and changes in market
conditions. The sub-categories listed under the six programs/activities listed above are representative of programs that will be addressed under this Plan; these
projects and programs are subject to change.
' Newport Extension- mayinclude public improvements
~ approximately 5.0%of project costs
3 Administratvie Program & Indirect Costs include the reimbursements to the City's General Fund for work completed by the City's operating departments,
Redevelopment Agency staff, and supporting consulting services. This also includes overhead associated withCity and Agency staff.
Tustin Community Redevelopment Agency Page ~ 31
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
Section III
Five-Year Implementation Plan
for
Housing Redevelopment Activities
Tustin Community Redevelopment Agency Page ~ 32
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
HOUSING ACTIVITIES
III.1 Introduction
The Housing Section is a major component of the Implementation Plan. The Plan represents
the Agency's explanation of how specific goals and objectives and proposed projects,
programs and expenditures will implement the low and moderate income housing
requirements mandated by law, including the following:
1. An annual housing program for the five year Implementation Plan term that provides
sufficient detail to measure performance of the Low and Moderate Income Housing
Fund Requirements.
2. An estimate of the number of new, rehabilitation, assisted, price restricted and
destroyed housing units during the term of the respective redevelopment plan.
3. An outline of the Agency's plan in using the Housing Set Aside Funds including annual
deposits, transfers of funds, or accruals for special projects.
4. An identification of programs and projects that will result in the destruction or
removal of existing affordable housing, if any, and the proposed locations for
replacement housing.
5. The Agency's ten year housing affordability compliance plan as required by California
Community Redevelopment Law (CRL) Sections 33413(b)(4) and 33490(a)(2).
111.2 Background
In addition to CRL requirements, the Agency's affordable housing efforts are guided by the
Regional Housing Needs Assessment (RHNA) produced by the Southern California Association
of Governments (SCAG), and the City's Housing Element and Comprehensive Affordable
Housing Strategy. In June 2008, the City and the Community Redevelopment Agency adopted
the 2008/09 - 2017/18 Comprehensive Affordable Housing Strategy (CANS) to direct and
focus the City's and Agency's efforts to produce and maintain affordable housing within the
community. The CARS is largely the basis which the Second Five-Year Implementation Plan
has been formulated. While the 2000/01 - 2009/10 Comprehensive Affordable Housing
Strategy had not expired, significant changes in the housing market led the Agency to prepare
an updated CARS Strategy for the 2008/2009 to 2017/2018 period, to be coordinated with
the City's required S year update of its Housing Element. The updated CANS will further the
Agency's affordable housing efforts while taking into account the changing market and
ensuring consistency between Agency activities and the Housing Element.
The housing component of the Second Five-Year Implementation Plan is also guided by the
numerous provisions of the Community Redevelopment Law that regulate low and moderate-
income housing activities. As a result, the Housing Section of the Implementation Plan is
Tustin Community Redevelopment Agency Page 133
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
more comprehensive than the section for non-housing redevelopment activities. Along with
outlining the programs including the activities and expenditures, the housing component also
evaluates the Agency's compliance with the laws and regulations governing the Low and
Moderate-Income Housing Set-Aside Fund and Housing Production in a Redevelopment
Project Area. More particularly, the report reviews the Agency's major housing
responsibilities which generally fall under four broad categories including: 1) the set-aside of
20% of gross tax increment for low and moderate income housing (Sections 33334.2 and
33334.6 of CRL); 2) the creation of housing affordable to low and moderate income persons
and families based on the production of all new or substantially rehabilitated dwelling units
(Section 33413(b) of CRL); 3) the replacement of low and moderate income dwelling units
removed as result of Agency activity (Section 33413(a) of CRL); and 4) the proportional
expenditure from the 20% Set Aside fund on housing for low and very low income persons
based on community need (Section 33334.4(a)).
The goals of the Housing Program are to increase the quantity and improve the quality of
housing stock in Tustin by providing new and rehabilitated affordable housing opportunities
throughout the community. To accomplish the goals and objectives of the Housing Program,
the Agency adopted a Finding of Benefit on June 2, 2003, as allowed under the law, which
determined the use of Housing Set-Aside Funds outside of designated Redevelopment Project
Areas and throughout the City that would be of direct benefit to the MCAS Tustin
Redevelopment Project Area.
Under the California Health and Safety Code Section 33413, at least 15% of all new and
substantially rehabilitated dwelling units developed within a project area are required to be
made available at an affordable housing cost to and occupied by person and families of low-
or moderate-income. Not less than 40% of the total required affordable dwelling units are to
be made available to very low income households. The ten year production and expenditure
requirements under the CRL put a high financial burden on the Agency's new MCAS Tustin
Redevelopment Project Area. Insufficient tax increment revenue in the MCAS Tustin
Redevelopment Project Area's early years limited the Agency's ability to directly subsidize
affordable housing.
In order to assist the Agency in meeting its affordable housing obligations within the MCAS
Tustin Redevelopment Project Area, the City entered into agreements, either as a condition
of developing a larger project or developments that sold City-owned properties within the
MCAS Tustin Project Area at a discount to the market value accounting for the affordability
gap associated with the development of affordable units. On June 5, 2007, the City Council
approved the "Reimbursement Agreement Between the City of Tustin and Tustin Community
Redevelopment Agency Related to Affordable Housing Responsibilities to be Assumed by the
Agency ("Reimbursement Agreement")".
Tustin Community Redevelopment Agency Page 134
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
Under the Reimbursement Agreement, the Agency is reimbursing the City for its financial
assistance in carrying out the Agency's Redevelopment Plan objectives including the
production of affordable housing units. The reimbursement may come from 80% Tax
Increment/Non-Housing Funds and from 20% Tax Increment/Housing Set-Aside Funds.
Reimbursement sources are not limited to the MCAS Tustin Project Area but may also come
from 80% Tax Increment/Non-Housing Funds and Housing Set-Aside Funds from the Town
Center and South Central Project Areas.
111.3 Recent Legislation Affecting Housing Activities
Recently enacted legislation, Assembly Bill (AB) 987, effective January 1, 2008, requires
redevelopment agencies to compile and maintain a database of existing, new and
substantially rehabilitated housing units developed or otherwise assisted with monies from
the Low and Moderate Income Housing Fund. The database must be available to the public
on the Internet, and be updated on an annual basis. The Agency's database consists of two
lists, one for affordable owner-occupied housing units and the other for affordable rental
housing projects. The list can be found on the City of Tustin website, www.tustinca.org,
under Housing. In addition, AB 987 requires the recordation of a separate document, called
"Notice of Affordability Restrictions on Transfer of Property," for all new or substantially
rehabilitated units developed or otherwise assisted with moneys from the Low and Moderate
Income Housing Fund on or after January 1, 2008.
111.4 The Low and Moderate Income Housing Funds Available
Section 33334.2 of the CRL requires, for every redevelopment plan adopted or amended to
add territory on or after January 1, 1977, no less than 20 percent of the tax increment
received by the Agency from a Redevelopment Project Area be set aside for increasing,
improving and preserving the community's supply of low and moderate income housing. The
revenues may be expended inside or outside of a project area. If expended outside the
Project Area, a resolution must be adopted stating that outside expenditures are of benefit to
the Project Area. As discussed earlier, the Redevelopment Agency adopted Resolution No.
RDA 03-10 on June 2, 2003, stating that outside expenditures benefitted the Project Area.
Figure III-1 identifies the amount of housing set-aside funds available in the Low and
Moderate Income Housing Fund and the estimated amounts which will be deposited in the
Low and Moderate Income Housing Fund during each of the next five years. While the
projected set-aside tax increment revenues shown are based on projected development
activity within the Project Area, the actual housing set-aside deposits could be more or less
than the amounts shown based on actual development phasing.
_- ---
Tustin Community Redevelopment Agency Page 135
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
.•
~~• ~• ~
Estimated
Beginning
MCAS Tustin Fund Balance
Project Area (7/1/2008) 2008/09 2009/10 2010/11 2011/12 2012/1
Estimated Tax
Increment
Depositsl $3,306,096 $4,897,544 $5,525,186 $6,699,892 $7,316,224
Interest EarningsZ $45,135 $46,159 $75,051 $115,432 $177,077
Total Revenue $3,351,231 $4,943,703 $5,600,237 $6,815,324 $7,493,301
Debt Obligations
Reimbursement
Agreement3 $3,292,743 $3,292,743 $3,292,743 $3,292,743 $3,292,743
Amended
Reimbursement to
City° TBD TBD TBD TBD TBD
Total Funds
Availables $2,579,162 $2,637,650 $4,288,610 $6,596,104 $10,118,685 $14,319,243
1 Housing Set-Aside taxincrement is 20`Y°ofthe total taxincrement generated in the MCASTustin Project Area. The estimated tax
increment deposits is based on calculations from Taussig & Associates, Inc.; adjusted to reflect a 1 year delay in the Implementation
Plan schedule.
z The Interest Earnings is estimated at 3.5°~, based on 50%ofthe outstanding balance from the previous year.
' The City loan payment of $3,292,743 is shown against the MCAS Tustin Redevelopment Project Area Housing Set-Aside Funds but the
payment can be distributed amongallthree Project Areas'80%Non-Housingand 20~ Housing Set-Aside Funds. The reimbursement to
the City has been modified from the June-adopted 2008 Comprehensive Affordable Housing Strategy. In addition, these payments are
assigned to pay for specific CIP projects. CIP priorities and costs can change annually as could the projected reimbursement payment
amounts by year as determined by the Finance Director. The encumberance will result in no surplus determination.
'The Agency may amend the Reimbursement Agreement with the City in the projected amount of $62 million; this phase ofaffordable
housing is not anticipated to coming online until 2011-12. The terms and conditions of the Reimbursement Agreement are anticipated
to be similar to the first reimbursement attreement. Annual pavments are to be determined (TBD1.
s Total Funds Available is the sum ofthe previous year's Funds Available and current year's Total Revenue, less Reimbursement to the
Cit .
The total amount of available funds for the five year period (FY 2008/09 to FY 2012/13) is
estimated to be $14,319,243. In addition to these funds being used for the production and
rehabilitation of affordable housing over the next five years, these funds will also reimburse
the City for its financial assistance to the Agency in the production of affordable housing units
during the Initial Five-Year Implementation Plan for the MCAS Tustin Project Area. Under the
Reimbursement Agreement, the Agency incurred a $46,407,736 obligation (debt) to the City.
Tustin Community Redevelopment Agency Page 136
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
111.5 Housing Programs, Projects and Expenditures
A description of the projects and program expenditures comprising the Agency's housing
activities during the next five and ten year periods are provided below.
1. Tustin Legacy -Ownership Multi-Family New Construction (322 units, $39,753,509)
-t is anticipated that 322 affordable ownership units will be created in the next five
years. The 322 units are distributed as follows: 40 units for very low income
households, 116 units for low income households, and 166 units for moderate income
households as shown by location in Figure III-3. While no Agency direct funding will
be provided by the Agency for the affordable units in the Villages of Columbus, units
will be developed as a result of the City providing density bonus incentives including
variances of certain development standards as a financial incentive towards the
developer's provision of affordable housing.
The unit count in Neighborhood D and G represents Phase 1 of the Tustin Legacy
Community Partners LLC (TLCP) Master Planned development; the subsidy
requirement by the Agency is unknown at this time but we can assume that the
average subsidy will be consistent with at least current affordability gaps of providing
affordable ownership units by household type currently at the Tustin Legacy project.
The initial subsidy will be borne by the City as an off-set against land sale value with
the cost being transferred to the Agency under the terms and conditions of the
existing Reimbursement Agreement, as may be amended.
Depending on Financing Markets and also other market conditions, the Agency will
need to maintain the flexibility to reduce its affordability gap in producing these units
by changing out affordable ownership units for affordable multi-family apartments.
2. Tustin Legacy -Multi-Family Rental, New Construction (253 units, $35,445,300)
The City's Disposition and Development Agreement with TLCP calls for the
development of 253 new affordable rental units, including 126 units for very low
income households, 64 units for low income households, and 63 units for moderate
income households. The TLCP unit count represents projected Phase 1 development;
the subsidy requirement is currently estimated at approximately $35,445,300. David
Rosen & Associates' affordability gap calculation of $140,100 per unit found in Table 4
of the 2008/09 - 2017/18 Comprehensive Affordable Housing Strategy was used to
calculate the estimated subsidy. The subsidy will be borne by the City as an off-set
against land sale value with the cost being transferred to the Agency under the terms
and conditions of the existing Reimbursement Agreement, as may be amended.
Tustin Community Redevelopment Agency Page 137
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
3. First Time Homebuyer Assistance and/or Foreclosure Negotiated Purchase
(30 units, $2,400,000)
The City's First-Time Homebuyer Program provides down payment and second
mortgage assistance to low and moderate income buyers to assist them to purchase
an existing home in the City. The recent mortgage credit crises have resulted in
increasing foreclosure rates throughout many parts of California. The City has
allocated $2.4 million to assist new first-time homebuyers in purchasing a home. This
may also include negotiated purchase of homes in foreclosure, which may represent a
lower cost buying opportunity for first-time homebuyers. The City anticipates
assisting 30 buyers with these funds and projects two purchases occurring in the
MCAS Tustin Project Area.
4. Homeless Assistance and Supportive Services (non-local resource)
The City has allocated $60,000 in CDBG funds to continue its financial support of
homeless assistance and supportive services in the City. The City's goal for this
program is to assist 200 homeless individuals per year during the Second Five-Year
Implementation Plan.
5. Administrative Support Expenditures ($1,439,579)
Administrative Support costs incurred and directly related to implementing the
housing program include salaries, overhead, consultant and legal expenses, supplies,
etc. The Agency's administrative program support expenditures from Housing Set-
Aside Funds must be determined each year and found to be necessary to implement
the housing program (CRL Section 33334.3(d)).
Figure III-2 provides an illustrative example of how the combined housing programs could be
financed on an annual basis over a five year period. Actual timing and specific amounts may
be adjusted over time and specific decisions are made as part of the Agency's annual budget
process. The CRL identifies that beginning fund balances in any year which exceed the higher
of $1 million or the sum of the prior 4 year deposits and which are funds which have not been
contractually encumbered are considered "Excess Surplus" and such funds must be expended
within one year.
Tustin Community Redevelopment Agency Page 138
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
Beginning Fund
Balance $2 579 162 $2,449,851 $3,746,439 $5,752,124 $8,862,715
MCASTustin Housing
Set-Aside Fund
De osits $3,306,096 $4,897,544 $5,525,186 $6,699,892 $7,316,224 $27,744,942
Investment Interest $45 135 $46 159 $75 051 $115 432 $177 077 $458 854
Community
Development Block
Grant $50 000
Estimated Total
Resources $5 940 393 $7 403 554 $9 356 676 $12 577 448 $16 366 016 $28 253 796
Tustin Legacy-
Ownershi 1 UNK UNK UNK UNK UNK UNK
Tustin Legacy -
RentalZ UNK UNK UNK UNK UNK UNK
First Time Homebuyer
and/or Foreclosure
Ne otiated Purchase $0 $80,000 $0 $80,000 $0 $160,000
Homeless Assistance
& Supportive
Services3 $10,000 $10,000 $10,000 $10,000 $10,000 $50,000
Reimbursement
reement $3,292,743 $3,292,743 $3,292,743 $3,292,743 $3,292,743 $16,463,715
men e
Rei mbursement to
Ci a TBD TBD TBD TBD TBD TBD
Administrative &
Indirect Ex ensess $187 799 $274 372 $301 809 $331 990 $343 609 $1 439 579
Estimated Total
Ex endftures $18113,294
Balance Available $2 449 851 $3 746 439 $5 752 124 $8 862,715 $12 719 664
The projected obligation to develop 130 affordable ownership housingunits at Tustin Legacy is $39,753,509. The initial subsidy
will be borne by the City with the cost beingtransferred tothe Agency underthe terms and conditions ofthe existing
Reimbursement Agreement. While development is projected to begin in 2011-12, the annual expenditures are UNKNOWN at this
1 The projected obligation to develop 253 affordable rental housingunits at Tustin legacy is $35,445,300. The initial subsidywill
be borne by the Citywith the cost beingtransferred tothe Agency underthe terms and conditions ofthe existing Reimbursement
Agreement. While development is projected to begin in 2011-12, the annual expenditures are UNKNOWN at this time.
' Homeless Assistance & Supportive Services is funded by Community Development BlockGrant Funds
The Agency may amend the Reimbursement Agreement with the City in an additional projected amount up to $62 million; this
phase ofaffordable housing is not anticipated to comingonline until 2011-12. The terms and conditions ofthe Reimbursement
Agreement are anticipated to be similarto the first reimbursement agreement. Annual payments are to be determined (TBDj.
'Administrative Support Expenditures are projected togrow 3.5%annually. The exception is 2009/10 when Support Expenditures
increase an additional $320,000 as a result ofexpenses previouslyassigned to the Tustin Legacy Enterprise Fund. The Enterprise
Fund closes at the end of 2008/09 and the additional expenses will be allocated to the MCAS Tustin Expenditure Accounts.
Tustin Community Redevelopment Agency Page ~ 39
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
Given the successful implementation of the Housing Program, projects and expenditures
noted above, the annual distribution of the units for each major program category is provided
below:
111.6 Proportional Expenditure of Housing Funds
Section 33334.4(a) of the CRL requires expenditures in the Low and Moderate Income
Housing Fund during a 10-year period to assist very low and low income households in at
least the same proportion as the total number of units needed within the community. The
proportion of very low, low and moderate income units is determined for each community on
the basis of the unmet need for housing amount certain income group categories as reflected
in the City's share of the regional housing needs identified pursuant to Section 65584 of the
California Government Code (the Regional Housing Needs Assessment (RHNA). In addition
CRL 33490(a)(2)(C)(i) requires the Agency to identify the number of housing units needed for
very low, low and moderate income persons as each of those needs have been identified in
the most recent determination pursuant to Section 65584. "Figure III-4 - 2006-2014 RHNA
Adjusted Affordable Housing Expenditure Goal" identifies the number of affordable housing
units the City is to produce under the current RHNA. The number of housing units was
Tustin Community Redevelopment Agency Page 140
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
produced by the Southern California Association of Governments (SCAG) and has been in
effect since January 1, 2006 and was included in the newly adopted Housing Element of the
General Plan.
Total
Description Very Low 1 Low Moderate Above Moderate Affordables
SCAG Produced RHNA
Goals (2006) 512 410 468 991 1390
Original RHNA
Proportional
Expenditure
Requirementz 37% 29% 34%
Non-Agency Assisted
Affordable
Households To Date
(Jan. 1, 2006 -duly 16, 2008) 225 40 43 649 308
Modified Adjusted
Proportionate Goal
piny 17, zoos -dune 30, zola) 287 370 425 342 1082
Modified Adjusted
Proportionate
Expenditure
Requirement2 27% 34% 39%
Future Projected Non-
Agency Assisted
Affordable
Households3(~~lyi~, 40 85 67 192
Revised RHNA Goals
tan. 1, zoos -July ls, 2013 247 285 358 890
Revised Proportional
Expenditure
Re uirement4 28% 32% 40%
' Actual production duringthe Initial Five-Year Implementation Plan includes the Village ofHope, a 192-bed transitional
facility. Columbus Square and Columbus Grove in Figure III-7 are non-Agency assisted affordable housing developments.
' Percentages may not total 100%due to rounding.
' Adetailed breakout ofAffordable Households to be built and assisted duringthe Second Five-Year Implementation Plan can
be found in Figure III-7. Columbus Square is non-Agencyassisted affordable housing.
The E~enditure Requirement is forthe term of the Second Five-Year Implementation Plan unless actual non Agency
Assisted Households increases in which the RHNAgoals could still adjust. Percentages may not total 100%due to rounding.
Tustin Community Redevelopment Agency Page 141
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
The Agency's original RHNA proportional expenditure requirements are 37% for very low
income households, 29% for low income households, and 34% for moderate income
households. Pursuant to CRL 33334.4(a), the Agency may adjust the proportion by
subtracting from the need identified for each income category, the number of units for
persons of that income category that are newly constructed over the duration of the
implementation plan with other locally controlled assistance and without agency assistance.
The City initiated the development of additional very low, low and moderate income housing
in the MCAS Tustin Project Area through density bonus incentives. Therefore, the Agency is
permitted to adjust the proportional expenditure requirements accordingly as shown in
Figure III-4. In addition, MCAS Housing Set-Aside funds can be used outside of the Project
Area based upon an adopted benefit resolution and the Agency will insure funds used as such
will assist the Agency's efforts to comply with the ten-year requirement.
Based on the above, as adjusted pursuant to Section 33334.4(a) of CRL, the Agency will
spend, at minimum, 28% of Housing Set-Aside Funds for very low income households, 32% for
low income households and 40% for moderate income households. Figure III-4 identifies the
projected allocation of households assisted during the Second Five-Year Implementation Plan.
The target is intended over the life of the redevelopment project and not strictly on an annual
basis and the goal will be adjusted in conjunction with any further locally assisted projects not
funded by the Agency.
In addition, as of January 1, 2003, according to CRL Section 33334.4(b), each redevelopment
agency shall expend, over the duration of each redevelopment Implementation Plan, funds
for all persons regardless of age in at least the same proportion as the number of low-income
households with a member under age 65 years as compared to the total number of low-
income households of the community as reported in the most recent census of the United
States Census Bureau. According to the 2000 U.S. Census, 87 percent of low-income
households in Tustin included a member under the age of 65. Therefore, it is the Agency's
goal to spend approximately 87% of the moneys in the Housing Fund for non-senior
affordable housing activities to reflect this proportion of persons under 65 years of age in the
community. All of the units produced to date are for family housing and no expenditures
have been made for senior housing units. Coventry Court, the Lennar Homes senior housing
development projected to open in FY 2008/09, is building 153 affordable units in the
development as a result of City density bonus incentives.
Figure III-5 reports the Agency's first five year of expenditures and projects the next five years
for aten-year picture of expenditures in relation to compliance with Section 33334.4(a). As
noted in Figure III-4, the Agency's proportional expenditure goal of 28% for very low income
households and 32% for low income households requires at least 60% of the Agency's
Housing Set-Aside Funds are to be spent on very low and low income households. Figure III-5
Tustin Community Redevelopment Agency Page 142
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
demonstrates the Agency will actually spend 63% of Housing Set-Aside Funds on very low and
low income households, 38% for very low income households and 25% for low income
households. The allocation of funds was based on the projected number of households
developed under each income category multiplied by the average gap funding provided by
the Agency for each income category. The projections do not show the Amended
Reimbursement to the City's distribution of funds across the income categories. Based upon
the average gap funding for each income category and the number of units funded in each
income category, the Agency projects to spend at least 67% of the Housing Set-Aside funds
on very low and low income households when the Amended Reimbursement to the City
funds are applied to the Figure III-5 calculations. The Agency will insure Housing Set-Aside
funds are expended in proportional compliance with Section 33334.4(a).
Tustin Community Redevelopment Agency Page 143
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
.... .-
Expenditures -
Housing Programs
First five Years
2008/09
2009/10
2010/11
2011/12
2012/13 Ten Year
2003 - 2008 TOTAL
Reimbursement $2,500,000 $3,292,743 $3,292,743 $3,292,743 $3,292,743 $3,292,743 $18,963,715
reement'
Very Low $2,500,000 $954,895 $954,895 $954,895 $954,895 $954,895 $7,274,477
100% 29% 29% 29% 29% 29% 38%
Low $0 $921,968 $921,968 $921,968 $921,968 $921,968 $4,609,840
0% 28% 28% 28% 28% 28% 24%
Moderate $0 $1,415,879 $1,415,879 $1,415,879 $1,415,879 $1,415,879 $7,079,397
0% 43% 43% 43% 43% 43% 37%
First Time $0 $0 $80,000 $0 $80,000 $0 $160,000
Homebuyer and/or
Foreclosure
Very Low $0 $0 $0 $0 $0 $0 $0
0% 0.0% 0.0% 0.0% 0.0% 0.0%
Low $0 $0 $80,000 $0 $80,000 $0 $160,000
0.0% 100.0% 0.0% 100.0% 0.0% 100.0%
Moderate $0 $0 $0 $0 $0 $0 $0
0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Amended $0 TBD TBD TBD TBD TBD TBD
Reimbursement to
Ci
TOTAL $2,500,000 $3,292,743 $3,372,743 $3,292,743 $3,372,743 $3,292,743 $19,123,715
Very low $2,500,000 $954,895 $954,895 $954,895 $954,895 $954,895 $7,274,477
100% 29% 28% 29% 28% 29% 38%
Low $0 $921,968 $1,001,968 $921,968 $1,001,968 $921,968 $4,769,840
0% 28% 30% 28% 30% 28% 25%
Moderate $0 $1,415,879 $1,415,879 $1,415,879 $1,415,879 $1,415,879 $7,079,397
0% 43% 42% 43% 42% 43% 37%
' The initial payment tothe Cityduringthe Initial Five-Year Implementation Plan was assigned tothe verylow income
e~enditure category. The reimbursement to the City has been modified from the June-adopted 2008 Comprehensive
Affordable Housing Strategy. The allocation offunds across the income categories was based on the percentage of promissory
notes incurred for each income category.
l The Amended Reimbursement Agreement is projected to total $62 million. This phase of affordable housing is not anticipated
to comingonline until 2011-12. The projected payment is To Be Determined (TBD) and the payments can be modified on an
annual basis. The allocation offunds across income categories will be based on the projected percentage of promissory notes
[o be assi ned for each income cafe or .
As discussed earlier in Section I, the Agency has a $46,407,736 obligation to the City as
described in the June S, 2007 Reimbursement Agreement between the City and the Agency.
This payment schedule can be modified pursuant to the Reimbursement Agreement and in
conjunction with the adoption of the annual Agency Budget as determined necessary by the
Agency's finance director and executive director. An Amendment to the Reimbursement
Agreement or a new Agreement to reimburse the City by the Agency for up to an additional
Tustin Community Redevelopment Agency Page 144
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
$62 million is anticipated with the Master Developer's footprint to accommodate the
progress laid out in Figure III-3.
111.7 Affordable Housing Compliance Plan
1. Housing Production
The MCAS Tustin Project Area was adopted in 2003, and as a result is subject to housing
requirements contained in Section 33413 of CRL. These requirements mandate that certain
percentages of all housing developed in the project area be affordable to low to moderate
income households.
~ At least 15% of the units developed or substantially rehabilitated in the project area
(there are currently only new units being developed) by public or private entities
other than the Agency (including such entities receiving agency assistance) must be
available at an affordable housing cost to, and occupied by persons and families of
low to moderate income. Of these units, not less than 40% must be affordable to
very low income households. This translates to a very low income requirement of 6%
of the total units developed in the project area.
• Although rehabilitation and construction activities are not currently envisioned for the
Agency directly by the Implementation Plan, at least 30% of the housing developed or
substantially rehabilitated by the Agency itself within a project area must be available
at affordable housing cost, and occupied by persons or families of low to moderate
income. Of these units, 50% must be affordable to very low income households. This
translates to a very low income requirement of 15% of the total project area units
developed or substantially rehabilitated by the Agency. This requirement applies only
to units directly developed by the Agency and would not apply to units developed by
housing developers pursuant to agreements with or assistance from the Agency.
Per Section 33413(b)(2)(A)(iii) of the CRL, substantially rehabilitated dwelling units means all
units substantially rehabilitated with Agency assistance. Section 33413(b)(2)(A)(iv) of the CRL
also defines substantial rehabilitation as "rehabilitation, the value of which constitutes 25
percent of the after rehabilitation value of the dwelling, inclusive of land value.
Effective January, 2004, long term affordability covenants must be recorded on dwelling units
produced pursuant to Section 33413 of the CRL, requiring that the units be maintained at an
affordable housing cost to, and occupied by persons and families of low to moderate income,
for the longest feasible time but not less than 55 years for rental units and 45 years for owner
occupied units. The affordability controls on such units must be made enforceable by
recorded covenants or restrictions in the same manner as required for units assisted by the
Tustin Community Redevelopment Agency Page 145
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
Agency's 20% Housing Set Aside Fund if they are to count towards meeting production
requirements,.
Section 33413(b)(4) of the CRL also requires that the Agency's Implementation Plan for
housing activities must be consistent with the community's housing element and the
Agency's housing production requirement must be met every ten years. If more than the
required number of low and moderate income units are developed in the ten year period, the
affordable units in excess of the required number may be counted towards the agency's
requirements for the next ten year period. If fewer than the required number of units are
developed at the end of the ten year period, the agency must meet its production goals on an
annual basis until the requirements for the ten year period are met. The Agency may cause
the required inclusionary housing units to be produced inside or outside the redevelopment
project area, but all units developed or substantially rehabilitated by the private sector,
require two units outside the project area for each unit that otherwise would have had to be
available inside the project area.
2. Past Production of Affordable Units in the Project Area
"Figure III-6 - Project Area Inclusionary Housing Production" identifies the number of
affordable units that have been developed to meet the Agency's production requirements to
date. The MCAS Tustin Specific Plan has authorized the development of 4,210 housing units,
of which 4,076 units are proposed within the MCAS Tustin Redevelopment Project Area.
Approximately 21% of the housing is projected to be available at an affordable housing cost
to low and moderate income households. It is not projected during the Term of the
Implementation Plan that the Agency would develop or substantially rehabilitate dwelling
units within the Project Area.
Based on the information shown below, the Agency is exceeding the housing production
requirements for low and moderate income units and 14 units behind on the very low income
unit requirement. Appendix A has a detailed summary by project location of the number of
units produced and actual affordable covenant restricted very low, low and moderate income
units.
Tustin Community Redevelopment Agency Page 146
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
. - ~ . . ..
~~
• ~~:
Total Project •
.
Very Low .
Low Income Moderate
Above
Total
Area Income Units Units Income Units Moderate Affordables in
Construction Income Units Project Area
(Unrestricted)
Total Units Produced in
l 1338 1104
Project Area
Affordable Units
80 121 201
Re wired
Affordable Units by
Project
John Laing 447
Tustin Field I 22 12 44 78
Tustin Field II 11 11 18 40
Columbus Square 410
Cambridge Lane 13 23 0 36
Camden Place 8 17 13 38
Columbus Grove 224
Clarendon 12 0 30 42
Total Affordable
66 168 234
Housing Production
of Tota I
4.9% 5% 7.8% 17%
Construction
Unit Surplus / (Deficit)
Z -14 47
The number for above moderate income units was developed from Community Development's Tustin Legacy Monitoring Report
as ofJune 3, 2008 while the affordable production numbers were developed from the Redevelopment Agency's Affordable Housing
database. A portion of the Villages of Columbus' Cantara (27) and Westbourne (16) developments a total of 43 units - is in the
MCAS Tustin Specific Plan but not in the MCAS Tustin Redevelopment Project Area. These units were reduced from the total
number of units in calculating the Total Units Produced in the Project Area.
~ Phasing for development resulted in a lag in very low income unit production but all affordable obligations under statute have
been conditioned in the entitlement approvals.
* Reflects the combined low and moderate income category (Section 33413(b)(2)
3. Housing Units to be Developed (Future Production).
The successful implementation of projects, programs, and expenditures identified previously
in the housing portion of the Implementation Plan, would be anticipated to create new price
restricted units over the next five year period as shown in Figure III-7. Based on the proposed
projects, programs and expenditures, the Agency does not anticipate any problem in meeting
its required housing affordability obligations under State Law.
Tustin Community Redevelopment Agency Page 147
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
~~: ~
..
Total Project Very Low Low Income Moderate Above Total
Area Income Units Units Income Units Moderate Affordables
Construction Inwme Units in Project
(Unrestricted) Area
Estimated Production 2225 1650
Estimated Affordable
Housing Production 134 200 334
Requirement
Estimated Affordable
Housing Production
Ownership Units
Columbus Squa rel 40 85 67 423 192
Columbus Grovel 0 0 0 49 0
Neighborhood Gz 0 0 33 444 33
Neighborhood DZ 0 31 66 671 97
TotalOwnership 40 116 166 1587 322
Rental Units
Neighborhood GZ 73 42 39 38 154
Neighborhood Dz 53 22 24 24 99
Total Rental 126 64 63 62 253
Total Estimated
Affordable Housing 166 409 575
Production
Second Five-Year
Implementation Plan 32 209 241
Unit Sur lus Deficit
Initial Implementation
Plan Surplus/(Deficit) -14 47 33
Total Sur lus Deficit 18 256
The Columbus Square and Columbus Grove above moderate income production numbers were developed from Community
Development's Tustin legacy Monitoring Report as ofJune 3, 2008 while the affordable production numbers were developed from the
Redevelopment Agency's Affordable Housing data base. While theAinsleyParkdevelopment-a total of 84 units-is in theMCASTustin
Specific Plan, 83 ofthe 84 units are not in the MCAS Tustin Redevelopment Project Area and these units were reduced from Community
Development's estimated production numbers.
' Neighborhood G & D production numbers were based on TLCP Phase 1 development projections in the current DDA.
Tustin Community Redevelopment Agency Page ~ 48
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
Figure III-7 reflects the anticipated development of the 2,225 housing units during the Second
Five-Year Implementation Plan. The development of 575 affordable units includes
construction of 253 rental units. As discussed earlier, the MCAS Tustin Specific Plan has
authorized a total of 4,076 units in the Project Area, 879 (21%) are affordable. During the
initial Five-Year Implementation Plan, 1,338 housing units were built, of which 234 are
affordable. There is a Specific Plan-approved balance of 513 housing units, 70 affordable, left
to be developed beyond July 16, 2013, the end of the Second Five-Year Implementation Plan.
111.8 Replacement Housing Obligations
Section 33413(a) of the CRL requires that whenever dwelling units housing low or moderate
income households are destroyed or removed from the low and moderate income housing
market as part of a redevelopment project that is subject to a written agreement with the
Agency or where financial assistance has been provided by the Agency, the Agency shall,
within four years of the destruction or removal, rehabilitate, develop, or construct, or cause
to be rehabilitated, developed, or constructed, an equal number of replacement dwelling
units which have an equal or greater number of bedrooms as those removed or destroyed at
affordable housing costs within the jurisdiction of the Agency. The replacement housing
units shall be available at affordable housing cost to persons in the same or a lower income
category (low, very low, or moderate), as the persons displaced from those destroyed or
removed units. The MCAS Tustin Redevelopment Plan and Second Five-Year Implementation
Plan have determined that no replacement housing unit obligations would occur.
Tustin Community Redevelopment Agency Page 149
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
IV. RELATIONSHIP TO BLIGHT
The CRL requires an explanation of the relationship between proposed projects, programs
and expenditures to the elimination of blight with the project area during the period of the
Plan. At the time the MCAS Tustin Redevelopment Plan was adopted, the plan spoke to
health and safety conditions of buildings, and the factors that characterize economic
dislocation, deterioration or disuse. Briefly, a blighted area is one that contains specific
conditions and factors resulting in the lack of proper utilization of the area that constituted a
serious burden on the community and that could not be alleviated by private enterprise
acting alone.
Eliminating blight conditions are addressed through the adopted five-year programs outlined
in this Plan. Specifically, the Implementation Plan Goals and Objectives will assist in
attracting, retaining and growing businesses that are high job generators; assist in the
planning, design, and installation of public improvements that were non-existent prior to the
adoption of the Plan; assist in developing community facilities that address community needs;
and, assist in correcting environmental problems that will allow property throughout the
Project Area to be developed.
During the initial five years of the Implementation Plan, the Agency assisted and private
sector redevelopment activities have made major contributions in transforming the Project
from a former military base into a mixed use project comprising both public and private uses
that address the needs of the community in housing, commercial development, job creation,
and public facilities. Although significant progress toward addressing many of the blighting
conditions have been completed or are in the process of being completed, major blight
conditions remain. Many of the blight remediation conditions will be addressed under the
Second Implementation Plan.
Figure IV-1 illustrates the relationship between goals & objectives, projects & programs, and
blight elimination. This table ties the Agency's programs, described in Section II, to the
project and activities during the term of the Second Implementation Plan. The following is a
list of major blighting characteristics identified in the MCAS Tustin Redevelopment Plan and
how the proposed Agency programs during the next five-year period will eliminate or prevent
the spread of these blighting conditions within the Project Area:
• Unsafe/Unhealthy Buildings. The former MCAS Tustin base contains buildings and
structures used by its former occupant, the Marine Corps. Many of these buildings
contain materials that are no longer considered suitable for human occupancy. In
addition, most of the buildings are special purpose military buildings including
hangars used in the upkeep and maintenance of helicopters. Many of the buildings
date back to the 1940's and 1950's, none of the buildings have been seriously
Tustin Community Redevelopment Agency Page I SO
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
maintained since the early 1990's. Most of the buildings not removed during the
term of the initial Implementation Plan will be removed during the term of the
Second Implementation Plan.
• Factors that Hinder Economic Viability Use. Inadequate and obsolete infrastructure,
inadequate and obsolete buildings, and hazardous waste are factors that hinder
economically viable uses. During the term of the Second Implementation Plan
existing infrastructure will be removed, existing buildings will be removed, and
identified hazardous waste from the former occupant will be removed and/or
treated.
• Adjacent/Nearby Incompatible Uses. The former Marine base contained military uses
that are not compatible with the uses adopted under the Reuse/Specific Plan and the
MCAS Tustin Redevelopment Plan.
• Buildings on Land That When Subdivided would not meet Local Regulations. The
former Marine base contains buildings are not compatible with the City's zoning code.
The buildings occupying the former base were built for military functions and were
exempt from local regulations as a Federal facility. None of the buildings on the
former base were found suitable for occupancy. In addition, much of the land in the
Project Area contains aircraft-related facilities, runways, taxiways and aprons, and
other specialized military uses.
• Inadequate Infrastructure & Public Improvements. Existing infrastructure serving the
former MCAS Tustin base is antiquated having deteriorated over time. Additionally,
the infrastructure did not have the capacity to adequately serve the proposed uses
under the Reuse/Specific Plan. Infrastructure necessary to serve the uses under the
Reuse/Specific Plan was installed during the term of the initial Implementation Plan
by the private sector under various financing mechanisms. Not all of the necessary
infrastructure can be installed by the private sector without financial assistance from
the Agency. Under the Second Implementation Plan appropriate public infrastructure
will be installed to allow for the development of the Tustin Legacy project.
• Buildings that did not Conform to Codes Effective when Built. The closure of the
Marine Corps base resulted in the abandonment of buildings and the creation of
vacant lots.
• Facilities that must be Removed to Allow Development. Buildings on the former
military base will be demolished that are unsafe or unhealthy. All of the former
military buildings are in various stages of decay due to lack of maintenance after the
base was abandoned by the Marine Corps in the early 1990's. Removal of existing
buildings, facilities, and infrastructure will eliminate incompatible adjacent or nearby
Tustin Community Redevelopment Agency Page 151
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
uses such as the presence or military or aircraft-related uses that are now obsolete,
but would facilitate the effective reuse and development of non-military uses in the
Project Area.
• Hazardous Waste. The programs proposed are intended to eliminate or alleviate
hazardous waste conditions and encourage private investment in the Project Area.
During the term initial term of the Implementation Plan, the Agency worked with
local, regional, state, and federal agencies in clean-up activities resulting from military
operations.
Figure IV-1 is a table that shows the relationship between the Goals & Objectives, Projects
& Programs, and Blight Elimination.
Tustin Community Redevelopment Agency Page ~ 52
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
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V. SUMMARY AND CONCLUSION
Combined redevelopment activities by the City, Agency and private sector have contributed
to reducing the blighting conditions in the Project Area during the initial five years of the
Implementation Plan. Substantial progress towards achieving the Redevelopment Plan's
goals and objectives will continue during the Second Implementation Plan period; however,
financial resources are expected to be insufficient to complete all implementation activities
within the five-year time period.
During the initial Five-Year Implementation Plan the Agency's actions coupled with favorable
economic conditions served to stimulate development within the Project Area. The projects
identified in this Implementation Plan have substantially increased tax increment over the
estimates provided in the initial Implementation Plan.
The Project Area experienced considerable housing and non-housing activity during the initial
Implementation Plan period as a result of property disposition activity, demolition/clearance
activity, and site preparation work in the Project Area. Combined public and private
investments in the Project Area have made significant contributions toward eliminating
blighting conditions and stimulating new development and economic revitalization.
A number of large-scale public improvement projects are in progress and more of these
projects are in the planning and engineering stages. These activities are typically longer-term
and require considerably more money and financial participation than individual
development projects. The construction start dates for these public improvement projects
are subject to project funding availability, agreements with developers, and entitlement
conditions.
The projects, programs and expenditures to be implemented over the next five years will
depend on the level of financial resources available to the Agency. Available financial
resources will include tax increment, after the Agency's 20% deposit to the low and moderate
income housing set-aside fund, and revenue from bond proceeds, land sales, prior loan
repayments, interest earnings, and new loans to the Agency.
Tustin Community Redevelopment Agency Page 154
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
APPENDIX A
AFFORDABLE HOUSING TABULATIONS
Tustin Community Redevelopment Agency Page ~ 55
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
fiscal Year 2008-2009 through 2012-2013
APPENDIX A
MCAS Tustin Redevelopment Project Area
Housing Units Constructed/Restricted Units
July 17, 2003 to July 16, 2008
Totol
Development Very Low Low Moderate Market TOTAL Affordables
John Laing
Tustin Field I 22 12 44 62 140 78
Lindy Crossing 0 0 0 52 52 0
Wright's Landing 0 0 0 58 58 0
Corrigan 0 0 0 126 126 0
Ellyson Pointe 0 0 0 77 77 0
eennett's Place 0 0 0 61 61 0
Tustin Field 11 11 11 18 11 51 40
John Laing Totals 33 23 62 447 565 118
Villages of Columbus
Columbus Square
The Gables 0 0 0 68 68 0
Astoria 0 0 0 38 38 0
Verandas 0 0 0 44 44 0
Coventry Court 0 0 0 9 9 0
Cambridge Lane 13 23 0 64 100 36
Camden Place 8 17 13 100 138 38
Meriwether 0 0 0 87 87 0
Columbus Square Totals 21 40 13 410 484 74
Columbus Grove
Ciara 0 0 0 59 59 0
Westbourne 1 0 0 0 43 43 0
Cantara2 0 0 0 41 41 0
Madison 0 0 0 44 44 0
Clarendon 12 0 30 60 102 42
Columbus Grove Totals 12 0 30 247 289 42
TOTAL DEVELOPMENT 66 63 105 1104 1338 234
' There were an additional 16 units built at Westbourne that are outside of the MCAS Tustin Redevelopment Project Area.
" There were an additional 27 units built at Cantara that are outside of the MCAS Tustin Redevelopment Project Area.
Tustin Community Redevelopment Agency Page ~ 56
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
APPENDIX B
PUBLIC INFRASTRUCTURE AND COMMUNITY FACILTIES
Tustin Community Redevelopment Agency Page ~ 57
Second Five-Year Implementation Plan, MCAS Tustin Redevelopment Project Area
Fiscal Year 2008-2009 through 2012-2013
nurid Tatrs.ri~ encl.-lssocicrtes, lnc.
PuRe.ll-2
TUSTIN LEGACY FAIR SHARE ANALYSIS
PUBLIC INFRASTRUCTURE NEEDS LIST THROUGH auu rxti it
p n c~
Z
E
Description aoa
; ~ n ~
y 70_<~0
Bv.A~~b
Roadwa / Brid a Im rovements
1 Ksns+ on Park eat Connector - Incur ed into Item 7 Reach 102
2
Valence N. Valencia L -Red Htll to Armatron Inver ate0 into Item 7 Reach 102 _
3 Valends N. Valence Loo - Armstro to Kenai on Park West Connector - Into eted into Item 7
R
4 ,
Larladowns Incur rated iMO Item 7 Reach 102
S Edi er - 1400 Ft East d Redhill To East Connector Non-Backbone
6 Armat - Barranca to blamer
7
Armatro - Vaienda N. Vntenda L to Wamsr Inducted Item 1 2 3 8 4 3,433 878
20 825 803
8 Bri a -Tustin Ranch - Vabnda N. Valencra Loo to North end d Brid mdudm Ram 23
582 062
9 Tustin Ranch Road -North end d B ' e to Walnut In rated into Item 8
Reach 140 .
9A .
Tustin Ranch Road / Walnul North East C
m
Wid
i
10 o
er
en
n
Save ns Road 1,150,142
11
Valenaa N. Valerlaa L - Kensi on Park to Tustin Ranch 731,412
12
East Connector - Valencia N Valencia L to West end d Bri 1,137.113
13
BrW East Connector over Santa Ana Santa Fe Channel to Edi r 2 810 154
14
Moffett - North L to West end d Bri a 2 132 ?92
15
Brad -Moffett over Peters Can Channel 2.323.341
16
Moffett East end d over Channel to Harvard and Bike Path 3.693 373
17
Sweat Shade Marble Mourttain - Irnne CFD Fair Share i 824 052
18
Vabnda N. V1lienua L -Tustin Ranch to Moffett 341 888
19
North L - Monett to Jamboree Ram I ed iMO Item 18 Reads 114 122 5.795.629
20 Park North Lao -Wormer North to Jamboree Ram Into ated into Item 21 Reach 151
21 Park South L -Wamsr North to Tustin Ranch
22
Warner - RedNll to Armstron I ed into Item 23 Reach 148 15888 098
23
Wamsr - Arrnsir to Tustin Ranch d.5114,954
24
Wormer -Tustin Ranch to Jamboree Indudm Ri M d Wa A uisition 5.687.480
25
Twtin Ranch - Warner North to Banana 5 148 182
26
Warner -Jamboree to Harvard Irvine CFD Fair Share 8.538.706
27
Redhitl / er Intersection Im ovemments 704 663
28 Tustin Ranch -Valencia N. Valence Loo to Wormer North I rated into Item B Reach 140
29 South Loo • Tustin Ranch to Armstron 4 Lanes
30
Jambons Ram - Jamboroe to Park 2.a37.685
31
Barranca -Tustin Ranch Rd to Redhill 522 588
32
Banana - Jamboree to Tustin Ranch Indudl Ri ht d Wa A usrtion 2.595,704
33
SCE Banana ?20kv Tnnamiaaion Pde Relocations Deleted 8907 138
34 East Side Redhill - Barranca to Warner
35
East Side Redhilt -Wormer to Valenaa Loo 2.070.525
35A
Eest Side Redhill • Valencia Loo to 1000' Nonh Incur rated into Item 35
Reach 162 491,684
35B ,
SHIPPO Stud -
35C Sound Miti ation -Warner from Harvard to Culver 133.500
1.494,002
TOTAL
126.965.715
Traffic Si nals
38 Ed er I Kenai tors Park West Connector New In ed into Item 7 Reach 102'
37 Edi er I East Connector U reds
38
Harvard ! Wamsr U rode -Irvine CFD Fairahare 166.250
39
Jamboree / Barranca U rode 245 400
40
Banana I Mldikan New 2811 238
Ii Banana / Tustin Ranch New 413 074
42 Barranca / Armstr U reds 807,079
43 Redhill / f3arranca U reds - CA d Ivne CIP Pr ect 166.250
44 Deleted
45 Radhill !Wormer -
48 Redhill / Vabnda New Into rated mto Item 7 Reach 102 166.250
47 Vabr>cia ; Armstron New t rated into Item 7 Reach 102
48 Wormer / Armstro New
49 Armstr /South L New 332.500
SO blamer/Area E Street New -Note: TBD r TLCP Land Plan 332.500
51 Deleted 332.500
52 Tustin Ranch !Park South Loo New
53
Tustin Rand1 /Warner South New 301 250
54
Tustin Ranch /Warner North New 465.500
54A
Tustin Ranch /Warner North Nsw) 265.100
55
Tustin Ranch / Moffett New 172 500
56 Tustin Ranch I Valerlda New 332.500
57 blamer North /Park North L 332.500
58 Perk North L f Jamboree SB Ram New 301.250
59 Vabnds / Kenai on Park West Conrlsdor 241.000
60 Moffett / North L (New 183 087
299.250
l~as~ic/ l uussfg anal. Lssnciu/es. Mc.
Pale . f !-3
61 Moffett ! Harvard U rode Incor orated into Item 16, Reach 139
62
63
64
65 Tustin Ranch /Ram New
Tustin Ranch / Walnut U rade
Edin er /Ram New
Sweet Shade Marbb Mountain /Harvard Incor rated into Item 17 Reach 158 332,500
166 250
465,500
65 S' nal Interconnect S tem Into rated into Item 7 Reach 102
65
65
65
65 East Connector /North Loo New
S nal Interconnect S stem Note costs are into rated into the various traffic si nal bud ets
Si nal Controller Note costs are ~n rated into the various traffic si nal bud ets
S nal Controller Note costs are into ated into the various traffic si nal bud ets 299 250
_
TOTAL 57,2o7,a7s
Traffic Miti ation -Santa Ana / Irvine A reements
66
67
68
89
70
71
72
73
74
75
76
77
78 N rt /Edin er - Fi ure 19 -Tustin ATMS Fee Pa ent
Redhill /Edin er - Fi ure 19 -Tustin ATMS Fee Pa ent
Tustin Ranch /Walnut - F' ure 19 -Tustin Addition to Items 8 ~ 9 Irvine Contribution
Redhill /Main - F' ure 22 -Irvine
Michelson / Von Karman - Fi ure 23 -Irvine
Jamboree / Alton - Fi uro 24 -Irvine
Harvard / Atton - F ure 25 -Irvine
Culver /Warner - Fi uro 28 -Irvine
Barranca / Von Karman Su bmental Im ovements Into orated into Item 32. Reach 152
Barranca /Jamboree Intersection Im rovements Potensial TSIA
Redhill !Wamer Santa Ana
Grand / r -Santa Ana ustin Share = 29%
Grand /Edin ar -Santa Ana Tustin Share = 56% 81 196
81 196
195,000
1 787 861
1 816 625
2 775,854
594.051
594 051
139,505
4 482 005
2 185 220
1 659 061
7 623 919
TOTAL 23,795,343
Draina a Im rovements
79
80
81
82 Peters Can on Channel from Railroad Track to Edin er
Peters Can on Channel from Edin er to Ci Limit Incor orated into Item 79, Reach 504
Peters Can on Channel from Ci Limit to Barranca Irvine CFD Fair Share
Backbone Storm Drain Overall al
n
i
A 21,310,215
8,700,900
82
82
83 e
c
a
rmstron
Backbone Storm Drain Overall Includi Interim Storm Drain Connection at Warner b RSCCD
Backbone Storm Drain Overall Barranca Channel. Tustin Ranch, Park & Warner
Gradin Modification to eliminate Pum St
ti 7,210,593
25,783,307
26.488 109
84 a
on
Deleted 14,283,000
85 Deleted -
86
87
88 Barranca Channel Detention Basin / S orts Fiekls at Redhill /Wamer
Barranca Channel - Redhill to south of Tustin Ranch Not include Irvine CIP Pro ect
Santa Ana Santa Fe Channel Embankment Into orated into Item 13, Reach 204 1,059,432
6,788,566
_
TOTAL 111,62x,122
Water Quali /Mitt ation Im movements
89 Selenium Treatment Facil' Phase 1 B
kb
89
90 ac
one Facilit
Selenium Treatment Facil Phase 2 Backbone Facili
Water Quali Treatment S stems Ph
1 B 4,284,900
2,856,600
90 ase
ackbone Facili
Water Qual' Treatment S stems Ph
2 B 2,285,280
91 ase
ackbone Facili
Resources A enc Miti anon Im roveme
t
P 571,320
92 n
s -
eters Can on /Railroad to Edin er
Resources A en Miti ation Im ro
t
P 370,033
93 vemen
s -
eters Can on /Edin er to Ci Limit
Resource A en Mif anon Im rovem
t
P 4,627,222
94 en
s -
eters Can on / Cit Limit to Barranca
Resources A en Miti anon Im rovement
M
93A s -
aster Develo r
Resource A en Miti ation Im rovements -Peters Can on I Ci Limit to Barranca 1 194 342
_
TOTAL 16
189
697
,
.
D Utilities
Electric
95 Backbone Phase 1 Backbone + Cont
t
C
96 rac
or
har es -Refunds
Backbone Phase 1 Backbone + Contr
t
Ch _
97 ac
or
ar es -Refunds
Backbone Phase 1 Backbone + Contractor Cha es -Refunds _
98
Backbone Phase 1 Backbone + Contr
t
Ch _
ac
or
ar es -Refunds
nuti~id Turrssig encl. l.rsrx iules, /nc.
l'u~>e .11-4
Gas
99 8adkbone PMSe t Backbone • Conuaaor CAa es -Refunds
100 Backbone Phase 1 Backbone + Contractor CAar s -Refunds
101
Backbone Phase 1 Backbone + Contractor CAar s -Refunds _
102 Backbone Phase 1 Backbone + Contractor Char s -Refunds
Tal hone
103 Backbone Phase 1 Backbone + Contractor Char s -Refunds
104 Backbone Phase 1 Backbone + Contractor Cnar es -Refunds
105 Backbone Phase 1 Backbone + Contractor Cna es -Refunds
106 Backbone Phase 1 Backbone * Contractor Char s -Refunds
Cable TV
107 Backbone Phase 1 Backbone + Contractor CAar es -Refunds
108 Backbone Phase 1 Backbone * Contractor Char es -Refunds
109
Badkbone Phase t BadkDone + Contractor Ch c - Refunda _
110
Backbone Phase 1 Backbone + Contractor Char s -Relunds _
Telecomunlcatlons
111 Backbone Phess 1 Backbone + Contractor Ch s - RNunds
112
Backbone Phase 1 Backbone + Contractor Char s -Refunds _
113
Backbone PASSe t Backbone + Contndor CAST es - Refunds _
114
Badkborle Phase 1 Backbone + Contractor Char s -Refunds _
e PMss /Backbone + Contractor Ch es Tots) All Uturttec
Backbone PASSe 1 Backbone + Contractor Chx ss Total AM Utilities
Util Backbone All Phases AN UtlGbes 2902 080
S 853 343
t t 284 280
TOTAL 19.s39.7o3
Parks and Commun Facilities
115 N - boyhood Park: Master Deveb r Area G Park 01
116
117
118
119
120
121 N boAlood park. Masfer Deve Area G Park 02
Communi Park, Master bevel Area 46 Acres
vatic Center in Master Deve) Commurn Parts
Tenors Center m Master De Communi Park
Tustin L Park: Ci Area 24.5 Akxea
Linear Park; Master Develo r Area G inUudin waterwa , nds 4,408.203
t8 211 264
6,23L607
3.565.603
5.738.889
122
123
124 Linear Park. Master Davel er Area D inUudin watervra . nds
Linear Park; Master Develo r Area E mcudin waterwa , onds
Other Public-owned O S ace Maslen Deve Area G 6.969 666
125
Other Pudkc•owned O n S ace Master Deveb r Area D _
126
127
126
129
130 Other Publioowned O n ce Master Deveb r Area E
Pedestrian Brill - blamer I Linear Park
Pedestrian Brill - ArmsVon I Linear Park
Bn a Tustin Ranch over Linear Park Pedestrian Crossm
L Arch Structures in Linear Park 3.742.009
t 1.818.152
4,830.000
6.210.000
131
132
133
133
120A
1208
120C
132A O CF A. Fire Station - Edi er r Kensin on Park 2-B 8000 SF
Cr of Tustin Libra ;Tustin Civic Center
Ci of Irvine Publk Park Marble Mountain
Communi Ent S a e
Tustin L Parts CI Area 24.5 Acres
Tustin L Park Ci Aroa 24.5 Acres
Tustln L Park C Arse 24.5 Auss - Contin n
C' of Tustln L Tustin Civic Center 5,486.855
7,953.900
2600 000
1.325,287
2.321.080
4 998 480
288 044
1328
1326
t 33A
81A
C o! Tustln L Tustin Civrc Center
C' kH Tustln Li Tustln Clvk Center
Commu En Sa na e - Vakttaa / RetlMll - S n Onl
Peters Can /Trail Im ovements t 000 000
t Oat 000
2 854 000
225.000
TOTAL 248 858
102.156.e7a
GRAND TOTALS 407,478.930
votes:
1 Items in blue were provided by City Staff
2 Items No. 1. 2, 3, 4, 7, 36, 46 8 47 are based on actual contracted construction costs.
3 Items No. 20. 21, 24, 25, 30, 32, 33, 39, 40, 41, 52, 54, 57 & 58 are based upon actual construction
costs as identified in Exhibit A of Infrastructure Construcfion and Purchase Agreement with
Vestar/Kimco, Tustin, L.P.
4 MCAS Tustin Settlement Agreements with Cities of Irvine, Santa Ana and actual ENR
Cost Index.
5 Items No. 77 & 78 are based upon March 2007 estimates from City of Santa Ana pursuant to
Settlement Agreements
6 Item No. 133 A based upon actual contracted construction costs.
7 Items highlighted in yellow are the latest changes.