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File #: 22-4201    Name:
Type: Consent Item Status: Agenda Ready
File created: 5/13/2022 In control: City Council
On agenda: 5/17/2022 Final action:
Title: APPROVE AN AMENDMENT TO THE AFFORDABILITY AGREEMENTS FOR THE HERITAGE POINTE SENIOR APARTMENTS PROJECT APPROVE AN AFFORDABLE UNIT OVERCHARGE AGREEMENT FOR THE HERITAGE POINTE SENIOR APARTMENTS PROJECT
Attachments: 1. Administrative Report, 2. Heritage Pointe Amendment 051722 revised f, 3. Heritage Overcharge Agreement 051722 revised f, 4. March 11, 2022 KMA Heritage Pointe: Affordable Housing Covenants Analysis
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To: MAYOR AND CITY COUNCIL
From: CAMERON HARDING, COMMUNITY SERVICES DIRECTOR

TITLE
title
APPROVE AN AMENDMENT TO THE AFFORDABILITY AGREEMENTS FOR THE HERITAGE POINTE SENIOR APARTMENTS PROJECT

APPROVE AN AFFORDABLE UNIT OVERCHARGE AGREEMENT FOR THE HERITAGE POINTE SENIOR APARTMENTS PROJECT
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EXECUTIVE SUMMARY
The Heritage Pointe Senior Apartments project is a 135-unit senior rental housing project located at 1801 Aviation Way ("Project"). The Project is currently subject to three incongruous income and affordability agreements.

The Project was purchased by Redondo Senior Partners LP, a Delaware limited partnership ("Current Owner") in August 2018. Since that time the City and the Current Owner have been attempting to resolve conflicting issues in the affordability agreements related to housing cost requirements, the allowable use of Section 8 vouchers in the project, the covenant period expiration date, and the quantification and repayment of any excess rents collected.

The City engaged Keyser Marston Associates, Inc. ("KMA") to assist in evaluating the identified issues and to provide recommendations for inclusion to replace the agreements and unify applicable standards. Based on the results of the KMA analysis, and legal interpretations provided by the City Attorney's Office and Richards Watson & Gershon ("RWG"), the City recommends approval of an amendment to the affordability agreements and an overcharge agreement to simplify the ongoing administration of income and affordability requirements at the property.

BACKGROUND
The 135-unit Heritage Pointe Senior Apartments project commenced operation in 1991. The Project includes 66 unrestricted market rate units and 69 units that are subject to long-term income and affordability restrictions. The following income and affordable housing agreements have been executed over time:
1. In 1988 the City and the original Project owner entered into the Declaration Agreement, which provided a density ...

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