HomeMy WebLinkAbout069-97 RESOLUTION NO. 69-97
AMENDMENT OF THE AFFORDABLE HOUSING AGREEMENT FOR 32 CEDAR
HOLLOW DRIVE (JOHN AND DEBORAH PIETKIEWICZ)
WHEREAS, on August 3, 1993 the Danville Town Council adopted Resolution No. 87-93
approving PUD 93-03 (Braddock & Logan Group); and
WHEREAS, the 18-unit residential development located along West E1 Pintado, opposite Ilo Lane,
was conditioned to provide two affordable units; and
WHEREAS, the Council subsequently adopted Town Council Resolution No. 77-95, authorizing
the execution of the project's Affordable Housing Agreement ("Agreement"), which formalized the
project's obligation to have two units designated, set aside and retained as moderate income units;
and
WHEREAS, the Council subsequently authorized an amendment to the Agreement, at the request
of Braddock & Logan Group, removing provisions in the agreement that gave the Town the first right
of refusal to purchase the units upon resale (provided for under Town Council Resolution No. 52-96);
and
WHEREAS, the units were subsequently completed and sold to qualifying households, as provided
for by the Agreement; and
WHEREAS, one of the two units is identified as 32 Cedar Hollow Drive, which was purchased by
John and Deorah Pietkiewicz just over one year ago; and
WHEREAS, the initial purchase price of the unit was within the allowable sales price provided for
under the Agreement;
WHEREAS, the Agreement runs with the property for a period of twenty years and establishes
parameters that serve to control the maximum allowable resale price of the unit and which stipulate
that buyers of the unit must qualify as moderate income households; and
WHEREAS, the Agreement stipulates that the unit may not be rented out by the owners of the
property; and
WHEREAS, as indicated in two letters submitted to the Town (letters of April 30, 1997 and May
4, 1997), the Pietkiewiczs are requesting that the Agreement be terminated to allow them to sell the
unit without controls on the resale price nor any controls pertaining to the household income level
of prospective purchasers of the property; and
WHEREAS, the Pietkiewiczs have also requested, should the Town choose not to allow a
termination of the Agreement, to have the Agreement modified to allow them to rent the unit (i.e.,
to modify the provisions outlined in Section 3(b) of the agreement; and
WHEREAS, a staff report was submitted to the Town Council which provided background
information regarding the matter and which recommended that the request to terminate the
Agreement not be approved and that the request to allow the unit to be rented be conditionally
approved; and
WHEREAS, the staff recommended that an amendment to the Agreement be authorized to allow
the Pietkiewiczs to rent the property to a household with an annual household income not in excess
of that of a four-person household earning 120% of the published median income for the
Alameda/Contra Costa County area and that the rental rate not exceed $1,982.75 a month; and
WHEREAS, staff indicated that the amendment to the Agreement would allow the intent of the
Agreement to be met (i.e., provision of affordable housing) without placing an undue financial burden
on the Pietkiewiczs; and
WHEREAS, there are unique circumstances involving the original purchase price, the size of the unit
and the resultant size of the down payment made by the original purchasers that complicate the resale
process and narrow down the pool of possible qualifying households that could purchase the unit; and
WHEREAS, given the above considerations, an amendment to the original agreement to allow the
unit to be rented on a temporary basis can not be construed as setting a precedent for other affordable
units subject to resale restrictions; now, therefore, be it
RESOLVED, that the Danville Town Council hereby finds that amendment of the Agreement to
allow short term rental of the unit to qualifying households by the current owners is consistent with
the goals and policies of the Town's Housing Element and is consistent with the intent of the
Agreement; and, be it further
RESOLVED, that the Danville Town Council hereby authorizes the Town Manager to execute an
amendment to the Affordable Housing Resale Agreement for 32 Cedar Hollow Drive reflecting the
changes authorized in this resolution and as substantially consistent with Exhibit 1 to this Resolution.
APPROVED by the Danville Town Council at a Regular Meeting held on May 20, 1997 by the
following vote:
AYES: Doyle, Waldo, Greenberg
NOES: Arnerich, Shimansky
ABSTAIN: None ~_~~ ~.~ ~~
ABSENT: None '~
MAYOR
APPROVED AS TO FORM: ATTEST:
CITY ATTORNEY CITY CLERK
PAGE 2 OF RESOLUTION NO. 69-97
Amendment to the existing resale restriction agreement for 32 Cedar Hollow Drive:
Temporary release from the no-rent provisions of the agreement (i.e., Section 3(b)), allowing
the Owner to rent the unit for a maximum period of three years. This temporary release is
subject to the following parameters:
A. Renting household's annual gross income shall not exceed the maximum
qualifying income for a moderate income, four-person household, as annually
established by HUD. For the calendar year of 1997, the renting household's
annual household income shall not exceed $72,100, as verified through a copy
of the W-2 form(s) for the income earners of the renting household or by a
letter from employer(s)) of the income earners of the renting household.
Upward changes to the maximum qualifying income level may occur to
coincide with upward changes to published area income levels.
B. Renting household shall pay a monthly rental rate that does not exceed 33% of
the maximum gross income for a four-person, moderate income household (i.e.,
$1,982.75/month for the calendar year of 1997). Upward changes to the
maximum allowable rental rate may occur to coincide with upward changes to
published area income levels.
C. Renting households shall be prohibited from subleasing the residence.
D. At the conclusion of the three year period, the Owner shall either re-establish
an owner-occupant status for the unit or shall sell the unit pursuant to the
provisions within the current resale restriction agreement. (Note: Either event
may occur prior to the completion of the three year period.)
E. Based upon submittal of information from the Owner that documents (to the
Town's satisfaction) that a diligent effort has been made for a minimum period
of six weeks to find a qualifying rental household meeting the above-stated
household income limitations, the Town shall release the Owner from the
requirements that the rental household have an annual household income that
does not exceed $72,100.
EXHIBIT 1