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West Davis Active Adult Community (Wdaac) Includes Massive Developer Give-Aways, Part 2

WestdavisMay Actually Cost the City Money on an Annual Basis, and The Development Agreement Is Non-Binding and Weak

by Alan Pryor and Nancy Price

Part 2

Forward: The Davis City Council has approved a sprawling senior housing development project located in West Davis along Covell. Voters will have a chance to approve or reject the project in this year’s November election. The project is called West Davis Active Adult Community (WDAAC).

On Tuesday, 8/28, Part 1 of this article was published in the Davisite, which discussed the massive reductions in Development Fees given away by the City to the Developer. This is Part 2 of the article.

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  1. The City Projects a Positive Annual Return to City Coffers as a Result of Build-Out of this Project. However, this Estimate is Based on Accounting Methods that Assume Unsubstantiated Reduced Costs on a Per Resident Basis for Providing Basic City Services such as Public Safety and Transportation.

The City’s Finance and Budget Commission analyzed the potential financial impacts to the City and made a number of projections about the project’s financial viability with respect to income or loss to the City. Their report to the City Council on February 12, 2018 can be found at www.cityofdavis.org/home/showdocument?id=9199:

The conclusions reached by 4 of the Commissioners (with two dissenting votes) made the following observations (with emphasis added):

  1. At the time of this analysis, the commission did not have available to it a development agreement with the city for the project. Therefore, any conclusions we have reached should be considered preliminary and subject to change….
  2. We recommend that the commission, or if necessary an FBC subcommittee, be provided a timely opportunity to review and comment on the fiscal provisions of the proposed development agreement before its presentation to City Council for approval.

Surprisingly, the Finance and Budget Commission never did again review the Development Agreement before it went to Council.  But nevertheless, City Staff assumed when otherwise calculating the project’s positive return to City coffers that the City’s average cost for providing services to the residents of WDAAC were only going to be 75% of the City's otherwise calculated average costs. Staff made this assumption without any quantitative explanation as to how they derived that 75% figure.

In fact, an alternate set of financial projections was proposed by Finance and Budget Commissioner Ray Solomon that specifically refutes the rosy projections by Staff. In this alternate analysis, Commissioner Solomon assumed that the current cost of providing City services to each resident will be, on average, reflected by the City’s current average costs for such services on a per resident basis.

When calculated in that manner, the average return to the City becomes a negative $150,000 to $200,00 annually.

Note: The estimates of income to and expenses by the City as a result of the WDAAC project that were prepared by Finance and Budget Commissioner Ray Solomon are contained in Appendix B.

  1. 2. There are No Guarantees This Project will ever be built as Proposed Because the Baseline Features are Vague and Imprecise and the Development Agreement is Exceedingly Weak.
  2. Building of Housing Types: Although the project proponent touts the range of sizes of homes which prospective seniors may purchase, there are absolutely no guarantees that any of the smaller housing units will ever be built.

It is critically important to note that the number of each different type and size of units to be built is not guaranteed in the Baseline Features or in the Development Agreement. It is entirely possible that the number of smaller cottages, bungalows, and condos will be severely reduced or even eliminated, and, alarmingly, this would still be consistent with the Baseline Features and Development Agreement.

This is because the language in the Baseline Features and Development Agreement specifying sizes and types of units is very vague, such as: “It is expected to include...” or “It will likely include...”. Because the precise numbers of different size units (or even a minimum number of the smaller units) is not specified in either the Baseline Features or in the Development Agreement, this developer is actually free to build whatever he wants, as long as the Council agrees. Does anybody honestly believe that will not happen?

In fact, the Council has already agreed with the developer that any changes they might make in the Development Agreement in the future will automatically be considered to be compliant with the Measure R Baseline Features because those Baseline Features are so poorly written.

The Development Agreement states (with emphasis added):

“West Davis Active Adult Community is required to develop in accordance with the Baseline Features stated above subject to mandatory compliance with state and federal laws. Project implementation may include further entitlements from the City of Davis, including but not limited to, Large Lot Subdivision Map, Final Planned Development, Tentative Subdivision Map, and Design Guidelines. Any changes to the attached baseline exhibit which are necessitated by compliance with legal, engineering, environmental and/or conditions on subsequent project approvals shall be deemed consistent (sic with) Baseline Features, and City of Davis Ordinances governing Measure J/R “(sic inserted by these authors)

So what exactly does the Baseline Features tell us about how many types of different units and sizes will be built?...Absolutely nothing!

The Baseline Features state (with emphasis added):

“A maximum of 560 primary housing units, including affordable, market rate rental and market rate for-sale housing units.

Offer a mix of housing types which may include single family homes, cottages, bungalows, multistory stacked flats, senior apartments, continuing care and affordable housing.

In an effort to provide a variety of housing options that are intended to meet a wide range of needs, the target home sizes are as follows:

o Greenway Homes – 1,200, 1,400 & 1,800 sf

o Senior Affordable apartments – 600 sf

o Cottages – 900 sf

o Bungalows – 1,100 sf

o Stacked flats/Condos/rental housing – mixture of home sizes from 600- 1,600 sf

Alarmingly, there are no guarantees to the voters that anything other than the largest Greenway Homes will ever be built. This simple truth is that the Development Agreement between the City and the developer can and will be amended and this agreement expressly states that these changes to the Development agreement will be deemed consistent with the Baseline features (see above).

This type of ambiguity is regrettably completely inconsistent with the provisions of Measure J/R which state:

“(2) Any application for an amendment or modification of the Land Use Map that proposes changing the Land Use Map land use designation shall require:

(a) Establishment of baseline project features and requirements such as recreation facilities,, public facilities, significant project design features, sequencing or phasing, or similar features and requirements as shown on project exhibits and plans submitted for voter approval, which cannot be eliminated, significantly modified or reduced without subsequent voter approval. “

Additionally, other equally ambiguous language in the Baseline Features specify that the development:

“Include a mixed-use Activity and Wellness Center that is available to the general public….an approximately 4.3-acre mixed use area, which would likely consist of a health club, restaurant, clubhouse, and up to 48 attached, age-restricted units; dog exercise area and tot lot;...” (Emphasis added)

  1. Activity and Wellness Center: The Development Agreement does not give much more guidance as to what exactly the Activity and Wellness Center will include except to say,

“The activity and wellness center shall include: limited office and retail space, including a privately owned and operated health club with shared access to the community owned swimming pool. Additionally, the center will contain community meeting space for various activities including classes and seminars. The facility will further include a clubhouse for the use and enjoyment of the neighborhood association”.

But there are NO specific features or sizes mentioned in either the Baseline Feature or the Development Agreement informing the voters what they can expect. Further, even new buyers of homes in the project will probably not know what the Activity and Wellness Center looks like because it does not have to even be constructed until after 301 of the 410 non-affordable housing units have been built.

And the Development Agreement gives no further guidance here. Although the Development Agreement states:

“This Agreement will eliminate uncertainty in planning for and securing orderly development of the Project,...”, the Development Agreement, in fact, has a huge number of uncertainties and is so vague that the Planning Commission did not even accept Staff’s request that the Planning Commission recommend to the Council to approve the Development Agreement. As a result City Council made the highly irregular decision to approve the project’s Development Agreement without the specific recommendation of the Planning Commission to do so.

The Development Agreement also has other glaring uncertainties besides the number and size of the buildings. For instance, the Development Agreement states:(5) Architectural Diversity. The General Plan includes goals and policies that promote design standards for new single family residential development that create variability of lot sizes, floor area ratios, setbacks, building height floor plans, and architectural styles/treatments within each new development area. The Project would be consistent with these General Plan goals and policies. The Project shall include a diversity of housing types, densities, and diverse architectural treatments.

Unfortunately, there are absolutely no provisions in the Development Agreement that actually specify which different designs are acceptable. In fact, almost all Greenway homes will look almost the same placed on almost identical row-like rectangular blocks of land.

Another stipulation of the Development Agreement regarding the Agricultural Buffer is equally unenforceable and vague and, essentially allows the developer to do anything he wants.

  1. Agricultural Buffer:The Project shall include approximately 7.2 acres of agricultural buffer area that will be managed and maintained by Developer and its successors and assigns. This buffer shall be comprised of an external 100-foot-wide section with features that generally exclude public activity, and an internal 50-foot-wide section that is designed to be interactive. The 100-foot external section will include a drainage corridor and predominantly use a native and drought tolerant plant palette. The 50-foot segment located proximate to the residences will include a trail, habitat nodes and other pedestrian-oriented amenities. If and where feasible, the 50-foot segment may also include community gardens and orchards to foster mental health and a healthy diet.”(Emphasis added)

How can the developer possibly fit in community gardens and orchards in a 50 ft buffer that must also include a trail and habitat nodes. It is almost a physical impossibility, thus virtually guaranteeing that these gardens and orchards will never be planted because they will be deemed to be “not feasible” and there are otherwise no legally binding fixed requirement for their planting.

As mentioned before, the City is legally precluded from imposing any more specific conditions on the sizes or designs or other amenities and features selected by the developer because in the Development  Agreement the City agreed not to do so, as follow.

“C. Subsequent Discretionary Approvals. The Developers' vested right to develop pursuant to this Agreement may be subject to subsequent discretionary approvals for portions of the Project. In reviewing and acting upon these subsequent discretionary approvals, and except as set forth in this Agreement, the City shall not impose any conditions that preclude the development of the Project for the uses or the density and intensity of use set forth in this Agreement. (Emphasis added)

In other words, because unenforceable and arbitrary standards are not more specific and are unresolved in the Baseline Features and Development Agreement, the developer can functionally do anything he wants and the City can do little about it. This is no way to entitle a massive project of this size and it sets a very bad precedent for any future development.

______________________________________________________________________

  APPENDIX B - WDAAC Financial Model

Comments

Merry Draffan

Where do seniors want to live? As I am not competent to evaluate the financial aspects of this development, I will leave that to others. However, I am a senior, and when I need to downsize my home, yard and garden, I would like a smaller yard and garden, definitely not a 4 story apartment unit. I also do not want to live downtown, It's easy to forget in the summer that downtown Davis becomes a late night bar scene during the school year. This is not conducive to a senior's sleep schedule! Seniors need some buffer from 25,000 plus students! Also, although there are some wonderful small markets downtown, there is no grocery store within walking distance. I had the pleasure of hearing David Taormino speak to a group about this project. It definitely sounded like a place I would love to live. The age group of "over 50" allows aging in place, with medical facilities very close by for older seniors, as well as a planned onsite medical office with tele-medical communication. The whole project is very "green" and environmentally forward looking. Meanwhile, we need housing now, not when there is a plan for the whole NW quadrant of Davis. This includes the larger homes that would be sold, as well as the adult community homes. I do not see that this project opens up anything else being built. As for transportation: certainly our public transit will have to expand to include the Cannery and any other new developments. This seems an obvious addition to any growth of a city, and not insurmountable. I suggest contacting Dave Taormino's office to hear a presentation about this project. WestDavisActive.com or 530-231-5519

Alan Pryor

I hope Merry Dreffen is a millionaire because that is the only way she will ever be able to afford to live at West Davis Active Adult Community.

The problem with this project is that it is really a luxury development for wealthy seniors...great if you're a millionaire or sitting on a huge amount of home equity and you can buy the high cost homes....not so great if your just a normal senior of moderate means. Do the math...1,800 sq. ft. (the standard proposed size for a single-story "Greenway" home) x $400/sq. ft. (minimum new home construction costs with the promised amenities) = $720,000. This is way beyond the means of most seniors meaning the development will be populated by only the most well-to-do.

On the other end of the spectrum, if you're a qualified low-income senior living on poverty social security levels, you MAY be able to get one of the promised subsidized low-income apartements (that is, if they ever actually get built - there are no guarantees). This will be around 600 sq.ft or less.

But if you a normal senior of moderate means, you are going to be completely out-of-luck because there is probably nothing in this development for you. The small "cottages" (for which there are no guarantees even these will be built) are still up to 1,200 sq.ft with an even higher price per sq.ft meaning they will probably cost in excess of $500,000.

This is a sprawling project which will yield the maximum profits for the developer but result in very few housing options for all but the richest seniors among us. Davis deserves a development that is inclusive and affordable to seniors and working families of moderate incomes not a sprawling luxury enclave for the well-to-do.

We do not need an exclusionary Del Webb-like community in Davis that caters only to the wealthy and which may or may not ever see the promised low-income housing get built.

For more information, please go to www.NoOnWDAAC.org

David J Thompson

Alan Pryor wrote recently,

“The point I was making was that this is fundamentally different than every other large development in town in the past 10 years where the developer contributed not only the land but also built the low income housing…

We have pointed out before that this statement is factually not true. Alan please do not keep repeating untruths. We don’t mind having a debate but when it comes to building needed housing for low income seniors lies become costly to those most in need in our community.

With the waiting lists for affordable housing being as long as they are with no affordable senior housing on the horizon Davis seniors are being forced to leave town.

The developers in the same category are the following over nearly a 30 year history. The donation of land to be set aside for affordable housing is the most valuable mechanism used by the city. The value of the land contributed to a non profit allows that land to be leveraged through state and federal programs to provide the highest subsidies and the lowest apartment rents. This category has provided more affordable housing apartments than any other during this past nearly 30 years.

The accusation you make is incorrect. Almost every major development in this same category since the policy began in recent years is listed below.
Almost all the developments over the past nearly 30 years are in the same category as WDAAC. They donated land for 570 affordable apartment units available to Davis residents and did not provide any funds for any affordable units. We are proud of the affordable housing that has been built in Davis and proud that low income members of our community can have a safe and affordable apartment.

Windmere 1 and 2 106 units land donated no other developer funds

Fox Creek 36 units land donated no other developer funds

Heather Glen 62 units land donated no other developer funds

Homestead 16 units land donated no other developer funds

Tuscany Villas 30 units land donated no other developer funds

Walnut Terrace 31 units land donated no other developer funds

Twin Pines Community 36 units land donated no other developer funds

Owendale Community 45 units land donated no other developer funds

Tremont Green 36 units land donated no other developer funds

Moore Village 59 units land donated no other developer funds

Cesar Chavez Plaza 53 units land donated no other developer funds

Eleanor Roosevelt Circle 60 units land donated no other developer funds

Please vote yes on Measure L to add another 150 affordable senior apartments to meet the needs of the 441 already on the waiting lists in Davis.

For the sake of the reader and the citizen voter, sensible planning and meeting internal need citizens deserve truth.

In an attempt at providing factual information to the Davis resident and voter.

We are, Neighborhood Partners, LLC www.npllc.org

Alan Pryor

First of all, as David Thompson readily knows (but is choosing to ignore), a vote for Measure L is not a vote for 150 low-income apartments. It is a vote for 71 acres of expensive, sprawling homes unaffordable to the vast majority of seniors and a "donation" of 4 .25 acres of raw land on which 150 low-income apartments MAY be built. But there are NO GUARANTEES that the money will ever be raised to put in these apartments. If Neighborhood Partners can't raise the money then the property reverts to the City and the City has to try to find the financing to build them. If David Thompson says there are guarantees to build it, he is being , let’s kindly say, less than truthful. Look at the Development Agreement with the City yourself which states,

"Developer shall work in good faith to identify an appropriate affordable housing developer which will demonstrate, to the satisfaction of the Director of Community Development and Sustainability, its ability to develop and manage senior affordable housing of a quality expected by the City of Davis. City commits to consider in good faith requests from the affordable housing developer that will help to facilitate or secure outside project financing. If building permits for a minimum of sixty (60) units on the affordable housing site have not been issued within three years of recordation of the final map creating the parcel, the affordable housing site will be transferred to the City."

The fact that there are no guarantees to build it is because the developer is not putting any cash into the low-income housing but only donating the raw land. Now if the developer had instead said, "If Neighborhood Partners can't raise the money then I will fund the construction myself" and put that in writing, then I would shut up and not continually harp on this issue. But they haven't and Neighborhood Partners is NOT similarly GUARANTEEING the apartments would be built by otherwise putting up a construction bond.

I am simply not willing to support a venture where 71 acres of farmland is used to put in a sea of expensive single-story homes on large expansive lots with the HOPE (and that is all it is) that Neighborhood Partners can raise the money to actually build the low-income apartments on 4.25 acres of land. If Neighborhood Partners can't raise the money, then the low-income apartments won't be built and the land reverts to the City who have already stated they have no money to even contribute to a small percentage of the required construction costs.

With regard to our claim that just donating the land is not enough in today's reality and our demand that the developer should pony up substantial funds or guarantees so we KNOW FOR CERTAIN that the low-income housing will be built, David Thompson gives a long list of succesful projects by Neighborhood Partners (or others) where only land was donated by a developer. These projects go back decades and the developers managed to otherwise get the construction financing elsewhere - noting that on some of the projects the development partner was actually Mutual Housing of California and Neighborhood Partners was only a "project consultant". But that was in another financial era where the City was doling out millions of dollars each year in Redevlopment Agency money from the state to fuel construction of low-income housing. But those sources of funds are now completely gone.

Again, I point to RECENT HISTORY (not 10-30 years ago), and stand by my statement that every "recent" major development approved in Davis either built (or are required to build) the low income housing on their own nickel and land (Cannery/Lincoln40/DavisLive/Nishi) or, in the case of Sterling Apartments, donated the land AND put $53,289 per apartment into the low income housing construction. On can see this clearly in the Development Agreement between the City and Sterling,

The proposed Affordable Housing Plan is contained in the Development Agreement. It requires provision of 38 affordable rental units and a $2,025,000 contribution to help with development of the affordable project. No City subsidy is anticipated. The site will be developed by Mutual Housing California, an affordable housing developer chosen by the applicant for this project.”

A $2,025,000 contribution / 38 apts. = $53,289/Apt

If the same per apartment contribution to actually build the low-income housing was made by WDAAC as was made by Sterling, WDAAC would be providing over $3,000,000 in additional funding to the low income housing construction.

60 units x $53,289 per unit = $3,197,340

The amount of money actually provided by the WDAAC developer for CONSTRUCTION of his low income housing obligation at WDAAC is $0.

I’ll note also that I disagree with the City’s calculations that only 60 units of low-income housing is required. According to David Thompson of Neighborhood Partners at a Planning Commission hearing on the project on November 8, 2017, the actual low income housing requirement for the WDAAC project is 76 units. I am not sure how Taormino negotiated this down to 60 untits because the calculation is not provided in the City’s Development Agreement with Taormino
But that aside, if Taormino similarly donates the land AND puts $3,197,340 into the construction of the apartmensts, I will also shut up. But that hasn’t happened so I will continue to insist that there are NO GUARANTEES that the low-income housing will ever be built.

All of this information is also documented on our website at www.NoOnWDAAC.org then click on the No Guaranteed Affordable Housing tab.

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