HomeMy WebLinkAboutQuestions/Answers on Agenda Item #9 From: West, Matt
To: West. Matt
Cc: David E. Kendia; Bernard. Nicole;Yasuda. Erica
Subject: Questions/Answers on Agenda Item#9
Date: Tuesday,August 17,20212:46:45 PM
Good Afternoon Mayor, Mayor Pro Tem, and Council Members,
The following questions were submitted by a Council Member to staff regarding item #9 on
tonight's agenda. Staff has prepared the following responses. In accordance with the Brown
Act, materials (such as this) provided to the majority of the Council within 72 hours of a
Council meeting are required to be made available to the public with the agenda materials.
1. The agenda references 140 market rate units. Can you confirm that these are all
Vintage? If not, please provide a breakdown. Also, please confirm whether Vintage
began its entitlement/development process prior to the finalization of the Inclusionary
Housing Ordinance, it appears this process occurred in or around 2016.
Yes, all 140 units are at Vintage. While the Vintage project was approved before the
adoption of the Ordinance, the Developer approached the City with a request to
rezone the property from Industrial to Residential at the same time staff were working
on the Ordinance. The Developer opted to voluntarily remit an In-Lieu Fee similar to
what was initially proposed with the Ordinance. As is the case with commercial
property owners adding residential units to their property under the Ordinance, the
Developer realized a significant increase in the value of the land when the City
approved the conversion from Industrial to Residential.
Tustin does not have an Inclusionary Housing Ordinance. Inclusionary Housing
Ordinances mandate that affordable housing be included in new developments
without an offsetting benefit to the developer. Tustin's ordinance is a Voluntary
Workforce Housing Incentive Program. It is only applicable within the Downtown
Commercial Core Plan and Red Hill Specific Plans, and only goes into effect if a
commercial property owner requests to develop a residential project on their
property. Such a property owner may request an allocation of residential housing units
beyond what their property is otherwise entitled under the existing zoning applicable
to their property. In exchange for receiving the benefit of the allocation of the
residential units from the City, the developer agrees to devote some of the units to
affordable (workforce) housing, or to contribute an In-Lieu Fee instead.
2. Of the $1,979,600 collected, how much has been spent and how has it been spent.
Please confirm the number of new affordable units that this money has funded the
creation of in the form of"gap financing".
To date, none of the funds have been spent yet. The Vintage project began making In-
Lieu payments April 2018 and the final payment was made in February 2020, bringing
the total to $1,979,600. In the 1 year the City has had the funds, there have not been
any new 100% affordable housing developments built or proposed. Typical gap
financing required for an affordable unit is $80,000 -$100,000/unit, with most 100%
affordable housing developments containing at least 50 units.
3. With regards to the units that the City has noted are pending, please confirm these are
the Red Hill project (also on the agenda tomorrow). If so, please confirm whether this
project owner began their entitlement/development process prior to the adoption of
the Housing Ordinance. I have heard he has been working on this for years, but not sure
of the actual timeline.
Correct, the pending units are proposed as part of the Red Hill project. And yes, the
owner of the Redhill project had a prior application pending when the Ordinance was
drafted. At that time, in consideration of the pending application, the City Council
offered a provision (discounted rate) for projects submitted prior to the adoption of
the Ordinance. However, the owner ultimately withdrew that application and later
submitted a different application; thus, the discounted rate is no longer applicable to
the project that is currently before the City Council.
Matthew S. West
City Manager
City of Tustin I www.Tustinca.org
300 Centennial Way I Tustin, CA 92780
0.714.573.30121 F.714.838.1602