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AHSC Resolution, Density Bonus Agreement, and Mitigated Negative Declaration February 5, 2019 Page 2 PLANNING COMMISSION ACTION At its regular meeting on January 14, 2019, the Planning Commission considered draft Mitigated Negative Declaration No. 2018-134 and recommended approval of the Density Bonus Agreement No. 2018-01 by City Council as conditioned by a vote of 5:2 (Commissioner Nguyen and Cano opposed). On January 15, 2019 City Council authorized the City Manager and Clerk of the Council to execute a pre -loan commitment letter with National Community Renaissance of California ("National CORE") with Mercy House Living Centers ("Mercy House") as the service provider for $3,170,547 in Inclusionary Housing Funds for the development of the Santa Ana United Methodist Church affordable housing project located at 609 N Spurgeon Street, Santa Ana ("Legacy Square"). The Housing Authority also approved an award of eight (8) project -based vouchers and authorized the Executive Director of the Housing Authority and the Recording Secretary to execute an Agreement to enter into a Project -Based Vouchers Housing Assistance Payments Contract with National CORE for the development of the project. In order for National CORE to develop Legacy Square, the developer will need a Resolution authorizing them to pursue grant funds from the State of California; a Density Bonus Agreement authorizing them to build the number of units that they are proposing; and a Resolution adopting the required California Environmental Quality Act (CEQA) documents. A general introduction for each action is provided below with more detail thereafter. In regards to the project financing, National CORE estimates the total development costs for the project to be $46,729,000. A large portion of National CORE's financing for the project includes applying for up to $20,000,000 in Affordable Housing and Sustainable Communities ("AHSC") funds made available through the State of California Department of Housing and Community Development (HCD). Administered by the Strategic Growth Council and implemented by HCD, the AHSC Program funds land -use, affordable housing, transportation, and land preservation projects to support infill and compact development that reduce greenhouse gas ("GHG") emissions. The deadline for the application is February 11, 2019. A resolution of the City Council supporting the submittal of the application for funding and, if awarded, authorizing the City to enter into an agreement with the developer for the use of the funds is included as Exhibit 1. The AHSC Implementation Agreement is included as Exhibit 2. Additional details on this Resolution and Implementation Agreement are provided below. In regards to land use, Santa Ana Municipal Code Section 41-1607 requires that the Planning Commission review a Density Bonus Agreement when a waiver or modification from local development standards are requested pursuant to the state density bonus law. On January 14, 2019, the Planning Commission recommended approval of a resolution by a vote of 5:2 approving Density Bonus Application No. 2018-01 as conditioned. A Density Bonus Agreement is required for the project to be fully entitled. The development will be 100% affordable to households earning less than 60 -percent Area Median Income or approximately $52,470 for a family of four. The approval of Density Bonus Agreement Application No. 2019-01 as conditioned will accomplish the goal of providing affordable housing opportunities in the City consistent with the purpose of the underlying zone and applicable designation in the General Plan land use element. The approval of the Density Bonus Agreement does not bind the City in any form to provide future funding for 75A-2