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Joint Public Hearing - <br />DDA with RSI Development LLC <br />January 5, 2009 <br />Page 2 <br />Development Agreement between the Community Redevelopment Agency and RSI <br />Development LLC for the development of two affordable, detached single- <br />family homes at 1112 and 1118 S. Orange, and which should include <br />collaboration between the developer and the Eastside Neighborhood <br />Association to develop home designs compatible with the historical <br />integrity of the neighborhood. <br />DISCUSSION <br />A key objective of the Redevelopment Agency (Agency) is to expand and <br />preserve affordable housing. To that end, the Agency staff has been <br />working to develop Agency-owned property at 1112 and 1118 S. Orange <br />Avenue (Exhibit 1) which was acquired as part of the McFadden <br />Realignment project. <br />Ronald M. Simon (RSI Development, LLC) has proposed a model project for <br />this site consisting of two single-family homes (Exhibit 2). Mr. Simon <br />has been recognized for his success in transforming the manufacturing <br />process of bathroom and kitchen cabinetry by streamlining the supply <br />chain and business process. The proposed model project will duplicate a <br />similar precision manufacturing model. The construction process is <br />controlled to enhance productivity and reduce waste of building <br />materials. The houses are designed to match building product <br />dimensions, thereby minimizing waste and utilizing wall panels and <br />precut structural components to reduce building time. These homes will <br />also meet Energy Star rating. <br />Although the home designs have been created taking into consideration <br />neighborhood compatibility, RSI will continue to work with Eastside <br />Neighborhood Association representatives to ensure that the new homes <br />support the historical integrity of the neighborhood. <br />The terms of the Disposition and Development Agreement (DDA) with RSI <br />provide for: 1) transfer of 1112 and 1118 S. Orange to RSI, at no cost; <br />and, 2) Agency funded construction financing, including soft costs, in <br />the amount of $225,000. The homes will have three and four bedrooms, <br />with 1,621 and 1,968 square feet, respectively. They will be sold to <br />low-income households earning no more than 80o Area Median Income (AMI), <br />for a sale price of $160,700 and $171,700, respectively. <br />The homebuyers will be responsible for securing the financing for the <br />First Trust Deed and will execute a zero-interest promissory note and <br />trust deed (silent second) with the Community Redevelopment Agency. The <br />-2 <br />