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HomeMy WebLinkAboutR-89-0965J-89-1006 10/26/89 RESOLUTION NO. A9'9W51 A RESOLUTION, WITH ATTACHMENTS, CONDITIONALLY DESIGNATING CODEC, INC., A NOT FOR PROFIT CORPORATION, TO UNDERTAKE, ON THE MELROSE NURSERY SITE, A LOW -DENSITY HOMEOWNERSHIP PROJECT AFFORDABLE TO FAMILIES AND INDIVIDUALS OF LOW AND MODERATE INCOME; ESTABLISHING SEVEN HUNDRED FIFTY THOUSAND DOLLARS ($750,000) AS REIMBURSEMENT TO THE CITY FOR THE MELROSE NURSERY SITE BY CODEC, INC.; APPROVING IN PRINCIPLE, USE OF $1,500,000 IN CITY ASSISTED SECOND MORTGAGE FUNDS BY PROJECT SPONSOR AS AN INTERIM CONSTRUCTION LOAN IN CONNECTION WITH THE LOW DENSITY AFFORDABLE SALES HOUSING DEVELOPMENT PLANNED; DIRECTING THE CITY MANAGER TO REQUEST METROPOLITAN DADE COUNTY TO CONVEY TITLE TO SAID SITE TO THE DESIGNATED SPONSOR/DEVELOPER SUBJECT TO CERTAIN TERMS AND CONDITIONS; AND RESCINDING PRIOR CITY COMMISSION LEGISLATIVE ACTIONS WHICH GRANTED DEVELOPMENT RIGHTS TO MELROSE TOWNHOME DEVELOPMENT, INC. AND THE ALLAPATTAH BUSINESS DEVELOPMENT AUTHORITY FOR DEVELOPMENT OF THE AFOREMENTIONED PARCEL. WHEREAS, there exists, in the City of Miami, a severe shortage of homes within the affordability range of families and individuals of low and moderate income; and WHEREAS, the City Commission recognizes that participation of both the public and private sector is necessary to foster the development of sales housing within the affordability limits and purchasing power of families and individuals of low and moderate income; and WHEREAS, on February 3, 1976, the City Commission passed and adopted Ordinance NO. 8515, which provided for the holding of a special bond election on March 9, 1976, for submitting to the qualified electors of the City the following questions: "Shall bonds of the City of Miami in an amount not exceeding $25,000,000 be issued under Ordinance No. 8514, to provide housing in the City of Miami for families and persons of low or moderate income qualifying therefor j ��jj �;v TS 4�rr F,' f W k',In its 1 r{ n l;9 f MW CITY COMMISSION MEETING OF OCT ' 1989c SOLUTION No.���5 EMARKS: under the then applicable law, by using the proceeds of the bonds to assist Dade County in financing such housing in the City of Miami, or to increase the security of any Dade County obligations issued for such housing in the City of Miami, such bonds to mature in annual installments not exceeding thirty (30) years from their respective dates, to bear interest at a rate or rates not exceeding the maximum lawful rate, at the time of sale, and to be payable from ad valorem taxes?"; and WHEREAS, on March 25, 1976, the City Commission canvassed the returns of said special bond election, passed Resolution No. 76-339, which declared that a majority of the votes cast in such election were in favor of issuance of said bonds; and WHEREAS, the foregoing bond issue has been authorized and approved by law, and these bonds have been duly validated, issued and sold; and WHEREAS, pursuant to the foregoing laws, the City and Metropolitan Dade County, have subsequently entered into various agreements to provide City assistance and involvement to Dade County, for the provision of housing for low or moderate income families and persons; and z WHEREAS, pursuant to the above referenced laws and ` agreements, Dade County filed a Petition in County Eminent Domain y7 proceedings, more particularly identified as Circuit Court Case No. 84-2738 (CA-14), instituted and maintained in the Circuit Court in and for Dade County, by which title to the Melrose 'i f Nursery Site as particularly described therein, was vested in the petitioner Dade County; and WHEREAS, the City Commission has determined that the publicly owned Melrose Nursery Site is locationally suited for development of sales housing; and -2- Q9"9r, A WHEREAS, at the September 14, 1989 City Commission meeting, a resolution was presented for City Commission's ratification which would, if approved, designate the development of a 150 unit townhome project on the publicly -owned Melrose Nursery Site as a Category "B" Project; and WHEREAS, through Motion No. 89-802, the City Commission directed the Administration to solicit proposals from private sector developers and not -for -profit community based corporations in connection with the development of affordable housing on the aforementioned parcel; and WHEREAS, in response to the City's .request for Statements of Qualifications from interested proposers, one proposal was received by the City from CODEC, Inc., a not -for -profit corporation; and WHEREAS, CODEC, Inc. has presented a development proposal most consistent with the City's development objectives for the site, as reflected in the attached memorandum from the City Manager; and WHEREAS, pursuant to applicable laws and agreements, Metropolitan Dade County holds legal title to the Melrose Nursery Site; and WHEREAS, 125.38, Florida Statutes, provides, in part, that any real or personal property owned by a county may be conveyed by the Board of County Commissioners to a corporation or organization not -for -profit upon any terms and conditions set by the Board of County Commissioners, which foster and promote the community interest and welfare; NOW, THEREFORE, BE IT RESOLVED BY THE COMMISSION OF THE CITY OF MIAMI, FLORIDA: Section 1. CODEC, Inc., a not -for -profit corporation, is hereby selected to sponsor the development of a low density, affordable townhome development on the Melrose Nursery Site subject to CODEC, Inc. providing evidence acceptable to the City of a firm construction financing commitment and conditional commitments for home purchase financing within the affordability limits of qualified low and moderate income families. -3- +R9_965. Section 2. CODEC, Inc. is hereby directed to prepare and finalize project plans and specifications, construction and home purchase financing, unit prices, construction schedules and marketing plans which shall be submitted within one -hundred and eighty (180) days of the date of this action for final consideration and approval by the City Commission. i/ Section 3. Subject to receipt by the City of an affirmative opinion from bond counsel for the bonds issued, pursuant to Ordinance No. 8514, Brown, Wood, Ivey, Mitchell and Petty; and, further subject to compliance with Section 1, 2 and 3 herein, the City Manager is directed to request Metropolitan Dade County to convey the Melrose Nursery Site in fee simple to the herein selected sponsor subject to certain terms and conditions, as set forth herein and as set forth in the attached City Manager's memorandum and as prescribed by the Metropolitan Dade County Board of County Commissioners. 2/ Section 4. The City Commission hereby approves and establishes $750,000 as the recoverable value to the City for the Melrose Nursery Site in connection with the affordable residential sales housing project to be undertaken by CODEC, Inc. on the above mentioned parcel. Section 5. The City Commission hereby reaffirms the City's second mortgage commitment to the Melrose Nursery project in the amount of $1,500,000, further authorizing the use of said funds as a interim construction loan to the project sponsor, subject to receipt by the City of an affirmative opinion from bond counsel for the bonds issued, pursuant to Ordinance No. 8514. Section 6. The City Commission hereby reaffirms and adopts Motion No. 88-182 (Attachment I), which approved the disposition and land reimbursement schedule (Attachment II), following Said presentation shall be in the form of a written agreement to be approved by the City Commission prior to execution thereof. The legal description of said site is set forth in the attachment and such request by the City Manager shall not be made until City Commission approval of the agreement referred to in Section 2 of this Resolution. -4- F19- 965. repayment to the City for value assigned the Melrose Nursery Site by the City Commission to be made in the form of a third mortgage. Section 7. Resolution No. 87-82 adopted on January 22, 1987, which granted development rights to Melrose Townhome Development, Inc., and previous City Commission expressions of recognition of the Allapattah Business Development Authority as project sponsor of affordable housing on the City - owned Melrose Nursery Site are hereby rescinded. Section 8. This Resolution shall become effective immediately upon its adoption. PASSED AND ADOPTED this 26th day of oqeo-bez�_( ,\1989. ER L . SUP4REZ , $AYOR ATTFST MA TY HIRAI, CITY CLERK PREPARED AND APPROVED BY: J2R?F�Ass AXWELL C IISTANT C TY ATTORNEY APPROVED AS TO FORM AND CORRECTNESS: i L.-FERNIkNDEZ CIT ATTORNEY JH/JEM/db/bss/M1253 41P1 w ATTACHMENT I = r Februar 25, i98R A MOTION OF THE CITY OF MIAMI COMMISSION M A8-IA2 STIPULA7ING THAT, IN- CONNECTION WITH THE CITY'S MOVED: DE YURti INTENDED DISPOSITION OF THREE PARCELS FNr4Lt MERICAN UNANIMOUS PUBLICLY OWNED PROPERTY TO (a) (b) FINANCIAL CORPORATION INTERNATIONAL, INC. CODEC, INC., AND (c) ST. JOHN COMMUNITY DEVELOPMENT CORPORATION FOR THE CONSTRUCTION OF AFFORDABLE HOUSING PROJECTS, THE ADMINISTRATION IS DIRECTED TO PRESENT A REAL PROPERTY - REIMBURSEMENT SCHEDULE TO BE FOLLOWED BY DEVELOPERS WHICH BASICALLY CAN BE SUMMARIZED AS FOLLOWS: 1) DEVELOPER SHALL PAY BACK TO THE CITY $25 PER MONTH FOR THE FIRST TEN YEARS TOWARD PRINCIPAL. AT NO INTEREST DURING SAID TINE; — ?) STARTING WITH THE ELEVENTH YEAR, DEVELOPERS WOULD BEGIN TO AMORTIZE THE REMAINING PRINCIPAL PLUS INTEREST AT 62 OVER THE PERIOD OF 20 YEARS. 3) IN NO EVENT WOULD MORTGAGE BE ASSUMABLE; 4) IF THERE WERE TO BE A CONVEYANCE' OF TITLE. THE ENTIRE MORTGAGE WOULD BE PAYABLE; 5) IN ORDER TO ASCERTAIN RECOVERABLE VALUE TO t THE CITY. AN APPRAISAL SHALL BE MADE OF THE PROPERTY IN QUESTION AND THE CITY SHALL TAKE THE LESSER AMOUNT BETWEEN THIS APPRAISAL AND THE ORIGINAL COST PAID AT TIME OF PURCHASE; AND 6) THERE SHALL BE NO PREPAYMENT PENALTY. 10 t MEUROSE NURSERY SITE REIMBURSEMENT SCHEDULF. ATTACHMENT 11 On February 25, 1988, the City Commission adopted Motion No. 88- 102, approving the disposition and land reimbursement schedule for the publicly -owned Melrose Nursery Site, Civic Cnnter Site and two parcels (sites 10 and 11) located in the Overtown neighborhood in connection with the development of three affordable sales housing projects planned in the City by Melrose — Townhome Development,. inc., CODEC, Inc. and St. John Community Development Corporation. Pursuant to Motion No. 88-182, the real property reimbursement schedule for the aforementioned publicly -owned parcels shall be as follows; 1) In order to ascertain recoverable value to the City of Miami for its land acquisition cost, the City Administration shall ' secure an appraisal of each of the subject properties and the City shall accept the lesser amount between the said appraisal and the original cost paid at the time of rorchase . 2) Reimbursement for said land cost by the project sponsor shall be in the form of a third mortgage placed on each individual housing unit and payments shall be made to the City of Miami at $25.00 Per month for the first ten (10) years and shall be applied to the principle only. No interest shall be applied during the aforementioned period. 3) Commencing with the eleventh year, the said third mortgacp shall be amortized over the remaining twenty (20Y years at six percent (6%) and shall include principle and interest J payments to the City. 4) In no event will the said third mortgage be assumable. 5) In the event of transfer of ownership and/or sale of the housing unit, full payment of the City's third mortgage, including principle and interest shall come due. 7 CITY OF MIAMI, FLORIDA INTER -OFFICE MEMORANDUM TO: Honorable Mayor and Members of the City Commission FROM :Cesar H. Odio City Manager RECOMMENDATIODT: DATE : M CT 19 1989 FILE . Recommendation on SU6JECT Selection of Sponsor for Melrose Nursery Affordable Housing Development REFERENCES City Commission Agenda Item: October 26, 1989 ENCLOSURES: It is respectfully recommended that the City Commission adopt the attached resolution conditionally designating CODEC, Inc., a not - for -profit corporation, to undertake the development, marketing and sale of a one hundred fifty (150) unit residential project affordable to low and moderate income families and individuals on the publicly -owned Melrose Nursery Site, predicated upon submission within 180 calendar days from the date of this conditional award for the Administration's verification and the City Commission's review and approval: 1) A final site plan addressing, to the extent feasible within the City's objectives for development of the Melrose Nursery Site. 2) Final project/unit plans and specifications. 3) A project development cost analysis. 4) A firm project development and marketing schedule, including a plan for insuring that all ethnic groups in Miami have equal access to information on the availability of, -and the opportunity to, make application for the homes to be developed. 5) Verifiable evidence of firm commitment(s) for construction, and first and second mortgage home purchase financing in order to undertake the development and marketing of the proposed project. It is further recommended that upon final approval by the City Commission of the foregoing, and subject to agreement between the City of Miami and CODEC, Inc., on selling price and terms of conveyance, as ratified by the City Commission, Metropolitan Dade County be instructed to convey the Melrose Nursery Site to CODEC, Inc. 89 -965 Lit Recommendation on Selection of Sponsor for Melrose Nursery Affordable Housing Development Page - 2 - BACKGROUND; On September 14, 1989, the City Commission was asked to approve a resolution designating as a Category "B" Project, the development of a one hundred fifty (150) unit affordable townhome development on the 8.5 acre publicly -owned Melrose Nursery Site. City Commission ratification of said resolution would have designated the City as the developer, along with providing the Administration authorization to proceed in the selection and retention of an architectural firm for the purpose of planning and designing an affordable housing project to be developed on the subject parcel. Following a discussion by the City Commission, through Motion No. 89-802, the City Commission directed the Administration to request proposals from both private sector and not -for -profit developers interested in developing affordable housing on the Melrose Nursery Site and to report back at the October 12, 1989 City Commission meeting. In response to the City's request for Statements of Qualifications from private sector and not -for -profit developers in connection with the development of affordable housing on the Melrose Nursery Site, only CODEC, Inc., a community wide not -for -profit housing developer submitted a complete proposal outlining the proposer's interest in developing the site. A letter of interest was submitted by Allied Minority Contractors Association (Black* organization) which essentially expressed the organization's interest in actively participating as subcontractors with the selected sponsor in undertaking this development. GENERAL DEVELOPMENT CONCEPT: The preliminary proposal submitted by CODEC, Inc. calls for the development of 150 townhomes consisting of both two (2) and three (3) bedroom dwelling units. The anticipated selling prices of the homes to be developed and marketed by CODEC, Inc. are estimated to cost between $50,000- $60,000 for the two (2) and three (3) bedroom units. 89-!965 Recommendation on Selection of Sponsor for Melrose Nursery Affordable Housing Development Page - 3 - The CODEC, Inc. proposal addresses the housing affordability factor by proposing tandem home purchase mortgage financing assistance to the homebuyers, with first mortgages to be provided through Homes for South Florida (consortium of local private lenders), and second and third mortgage assistance to be provided through the Metropolitan Dade County Documentary Surtax Program and the City of Miami. Using this tandem mortgage home purchase financing method, CODEC, Inc. will be able to offer affordable homeownership opportunities to families and individuals earning less than 80% of median income, well within low and moderate income guidelines. PROJECT FINANCING: To date, CODEC, Inc. has essentially secured a letter of intent for project construction and first mortgage home purchase financing in the amount of $6.5 million from Homes for South Florida for the proposed development. In June of 1988, through Resolution No. 88-529, the City Commission approved the establishment of a second mortgage home purchase financing loan pool in the amount of $1.5 million from the 1976 Housing General Obligation Bond fund, for the purpose of providing second mortgage loan financing for qualified low and moderate income purchasers of the townhomes previously proposed for development on the Melrose Nursery Site by Melrose Townhome Development, Inc. CODEC, Inc., in order to undertake the development of the Melrose Nursery Site, is requesting that the $1.5 million in City assisted second mortgage financing commitments be also earmarked for the prospective homebuyers of the proposed project. The project sponsor is further requesting usage of the above mentioned City funds on an interim basis, as a construction loan during the construction of the project. Upon completion and subsequent closing of each individual dwelling unit, the interim construction loan would be converted to a second or third mortgage loan held by the City. R9-. !75 3 Page - 4 - In order to insure that the housing units planned on the Melrose Nursery Site will be affordable to low and moderate income families and individuals, CODEC, Inc. is also requesting that the City establishes a value of $750,000 or $5,000 per unit as the reimbursement amount to the City for its cost of site acquisition. This amount represents fifty percent (50%) of the most recent reuse appraisal report secured by the City in April of 1988. The reuse appraisal report prepared by Appraisal First, Inc. which was based on the development of a 150 townhome project on the Melrose Nursery Site, assigned a value of $1,530,000 for the site. Should the City Commission approve the granting of development rights of the Melrose Nursery Site to CODEC, Inc., it will be necessary that the City Commission establishes the recoverable value to the City for conveyance of the subject parcel. This action is necessary in order to allow the project sponsor to proceed in securing construction and first mortgage financing from Homes for South Florida. The value assigned to the land by the City Commission is further necessary in order to enable CODEC, Inc., if selected by the City Commission, to submit a proposal for Surtax funding in the amount of $1,000,000 for second mortgage home purchase financing for the prospective homebuyers through the Dade County Documentary Surtax Program. At present, title to the Melrose Nursery is vested in the name of Metropolitan Dade County. Should the City Commission approve the designation of CODEC, Inc. as project sponsor to undertake the development, marketing, and sale of the housing units which are being proposed, it will be necessary that the City Commission direct the Administration to request Metropolitan Dade County to transfer title to the Melrose Nursery Site to CODEC, Inc., in fee simple subject to certain terms and conditions as previously enumerated. In an effort to facilitate the construction of the proposed 150 unit affordable housing project which is being proposed by CODEC, Inc. on the Melrose Nursery Site, it is recommended that the City Commission approve the attached resolution. L/