REPORT TO THE CITY COUNCIL June 8, 2017 FROM: JENNIFER K. CLARK, Director Development and Resource Management Department THROUGH: KELLI FURTADO, Assistant Director Development and Resource Management Department BY: THOMAS MORGAN, Manager Housing and Community Development Division CORRINA NUNEZ, Project Manager Housing and Community Development Division SUBJECT ..Title Approve Habitat for Humanity's extension to the Exclusive Negotiation Agreement for the disposition and development of City-owned property located at Willow Avenue and Byrd Avenue (Council District 5) ..Body RECOMMENDATION Staff recommends the City Council approve Habitat for Humanity's request to extend the Exclusive Negotiation Agreement (ENA), attached as Exhibit "A", from June 15, 2017 to November 24, 2017 for the disposition and development of City-owned property located at Willow Avenue and Byrd Avenue, and authorize the City Manager to execute implementing documents approved as to form by the City Attorney. EXECUTIVE SUMMARY On May 22, 2017, Habitat for Humanity (Habitat) requested an extension to its ENA, attached as Exhibit "B", to allow more time to rectify setback requirements, seek complete financing of the project, and work on the site plans and specifications. BACKGROUND On December 15, 2016, the City Council approved an ENA with Habitat for Humanity. The ENA provided Habitat with timelines of accomplishments leading up to execution of a Disposition and Development Agreement (DDA). Since entering into the ENA, Habitat has encountered some delays and is therefore requesting an extension to the ENA from June 15, 2017 to November 24, 2017. In accordance with the ENA Performance Schedule, Habitat has completed the following: Establishment of a 501(c)3 - The formation of a Community Land Trust was the necessary vehicle that allows the property to remain affordable in perpetuity. During this period of negotiation, Habitat sought formation of a 501(c)3 (EIN 35-2585880) for the Land Trust which is now a legally recognized entity called the Central California Land Trust (CCLT). Planning - Robin Goldbeck of Goldbeck and Associates and David Phillips of DLP Associates have worked together on behalf of the CCLT with City staff to craft a site plan that both aligns with the general plan, maximizes use, and creates space for over 70 attached and detached single family homes. During this exclusive negotiation period, multiple meetings with the DRC have occurred in an effort to finalize the plan and specifications. Appraisal - On April 8, 2017, James G. Palmer Appraisals, Inc. determined the fair market value of the property to be $824,000.00. Cost Analysis - During this ENA period, Matthew Grundy, Executive Director of the CCLT, has built a well thought out pro-forma and reviewed the details with City staff on April 5, 2017. An essential component to project's viability was the calculation of infrastructure cost. Mr. Grundy has worked with David Horn, Principal of Yamabe & Horn to ascertain the detail. In addition, Habitat had established bi-weekly steering committee meetings for the purpose of navigating the development of the project. The steering committee, which was comprised of two attorneys, two architects, a developer, a CCLT consultant, and a fund developer, has now passed the CCLT's operational duties to its newly formed Board of Directors. The CCLT Board members include those who bring a diverse level of expertise and collectively will help maximize community, public, private, for- and not-for profit benefit. Since Habitat has made and continues to make a good faith effort in the creation of the Disposition and Development Agreement for the property, staff is recommending approval of the extension to November 24, 2017. ENVIRONMENTAL FINDINGS This is not a project for the purposes of the California Environmental Quality Act (CEQA), pursuant to CEQA guidelines Section 15378. LOCAL PREFERENCE Local preference was not considered because the ENA does not include a bid or award of a construction or services contract. FISCAL IMPACT Not applicable APPENDICES: Exhibit A - Extension Request Exhibit B - Exclusive Negotiation Agreement