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2015-09-09 VHC Agenda PacketCalifornia Public Records Act ("PRA"): In compliance with the PRA, the documents pertaining to agenda items, including attachments, which are presented to the Vernon Housing Commission in open session are available for public inspection. They may be inspected during regular business hours in the Office of the City Clerk at Vernon City Hall, 4305 Santa Fe Avenue, Vernon, California 90058, no prior appointment necessary, and on the City’s website at www.cityofvernon.org. Americans with Disabilities Act (“ADA”): In compliance with the ADA, if you need special assistance to participate in the meeting, please contact the Office of the City Clerk at (323) 583-8811. Notification of at least 24 hours prior to the meeting or time when services are needed will assist the City staff in assuring that reasonable arrangements can be made to provide accessibility to the meeting or service. Agenda Regular Meeting of the Vernon Housing Commission Wednesday, September 9, 2015, 6:00 p.m. Council Chamber 4305 Santa Fe Avenue Vernon, CA 90058 Michael Hughes, Chairperson Melissa Ybarra, Vice Chairperson Hector Garcia, Commissioner John Kriste, Commissioner Steven Froberg, Commissioner Kyle Cooper, Commissioner Steven Florman, Commissioner CALL TO ORDER & FLAG SALUTE CHANGES TO THE AGENDA PUBLIC COMMENT - At this time the public is encouraged to address the Vernon Housing Commission on any matter that is within the subject matter jurisdiction of the Commission. The public will also be given a chance to comment on matters which are on the posted agenda during Commission deliberation on those specific matters. INTRODUCTORY BUSINESS 1. Self-introduction of newly appointed Commissioners Steven Florman and Kyle Cooper (Business Representative Seats). MINUTES 2. Minutes of the Regular Vernon Housing Commission Meeting held June 10, 2015, to be received and filed. Vernon Housing Commission Meeting Agenda September 9, 2015 Page 2 of 3 NEW BUSINESS 3. Approval and Adoption of Proposed Guidelines Regarding Tenant and Landlord Responsibilities and Tenant Do’s and Don’ts. Recommendations: A. Find that approval and adoption of the proposed Guidelines Regarding Tenant and Landlord Responsibilities and Tenant Do’s and Don’ts are exempt under the California Environmental Quality Act (“CEQA”) because such is not a “project” as that term is defined in the CEQA Guidelines section 15378, and even if it were a project, it would still be exempt in accordance with Section 15061(b)(3), the general rule that CEQA only applies to projects that may have a significant effect on the environment; and B. Approve and adopt the proposed Guidelines Regarding Tenant and Landlord Responsibilities and Tenant Do’s and Don’ts. 4. Approval and Adoption of Proposed Procedures for Tenants under First Responder Priority. Recommendations: A. Find that approval and adoption of the proposed procedures for tenants under first responder priority is exempt under the California Environmental Quality Act (“CEQA”) because such is not a “project” as that term is defined in the CEQA Guidelines Section 15378, and even if it were a project, it would still be exempt in accordance with Section 15061(b)(3), the general rule that CEQA only applies to projects that may have an effect on the environment; and B. Approve and adopt the proposed procedures for tenants under first responder priority. DISCUSSION AND POSSIBLE DIRECTIVES TO STAFF 5. Preliminary Discussion Regarding Potential Market Rent for Units to be Remodeled in Fiscal Year 2015/2016. Recommendations A. Find that discussion of market rent is exempt under the California Environmental Quality Act (“CEQA”) because such is not a “project” as that term is defined in the CEQA Guidelines section 15378, and even if it were a project, it would still be exempt in accordance with Section 15061(b)(3), the general rule that CEQA only applies to projects that may have a significant effect on the environment; and B. Hold a preliminary discussion regarding potential market rent for units to be remodeled in fiscal year 2015/2016. Vernon Housing Commission Meeting Agenda September 9, 2015 Page 3 of 3 ORAL REPORTS, PRESENTATIONS & COMMENTS FROM STAFF AND COMMISSION MEMBERS 6. Update on the sale of three City-owned housing units in Huntington Park. 7. Quarterly housing report to be presented by the Director of Public Works, Water & Development Services. 8. Report on the completion and grand opening of Vernon Villages Park Apartments by the Director of Public Works, Water & Development Services. 9. Brief reports, announcements, or directives to staff from the Commissioners and Commission Officers. SECOND PUBLIC COMMENT - The public is encouraged to address the Vernon Housing Commission on any matter that is within the subject matter jurisdiction of the Commission. ADJOURNMENT I hereby certify under penalty of perjury under the laws of the State of California, that the foregoing agenda was posted on the bulletin board at the main entrance of the City of Vernon City Hall, located at 4305 Santa Fe Avenue, Vernon, California, and on the City’s website, not less than 72 hours prior to the meeting set forth on this agenda. Dated this 3rd day of September, 2015. By: ________________________________ Maria E. Ayala City Clerk MINUTES OF THE REGULAR VERNON HOUSING COMMISSION MEETING HELD WEDNESDAY JUNE 10, 2015, IN THE COUNCIL CHAMBER OF THE CITY HALL LOCATED AT 4305 SANTA FE AVENUE, VERNON, CALIFORNIA MEMBERS PRESENT: Michael Hughes, Melissa Ybarra, Henry Haskell, Hector Garcia, Steven Froberg, and John Kriste MEMBERS ABSENT: Eric Gustafson The meeting was called to order by Chair Hughes at 6 p.m. Commissioner Kriste led the flag salute. CHANGES TO THE AGENDA Maria Ayala, City Clerk, announced that a correction will be made to Agenda Item No. 1, no other changes to the agenda are necessary. PUBLIC COMMENT Chair Hughes announced that this was the time allotted for public comment and inquired whether anyone in the audience wished to address the Commission. The public will also be given a chance to comment on matters which are on the posted agenda during Commission deliberation on those specific matters. No public comment provided. MINUTES 1. Corrected Minutes of the Regular Vernon Housing Commission Meeting held March 11, 2015, to be received and filed. Ms. Ayala announced the correction to page 3 of 4 as follows: (2) It was moved by Haskell and seconded by Kriste (not “Kristen”)… It was moved by Haskell and seconded by Ybarra to approve the Corrected Minutes listed above. Motion carried, 4-0, with 1 Abstention (Froberg). INTRODUCTORY BUSINESS 2. Self-introduction of newly appointed Commissioner Steven Froberg (Non-Council Resident Seat). Mr. Froberg introduced himself to the Commission and audience. He is excited to assist in leading the City of Vernon in a positive direction. Regular Vernon Housing Commission Meeting Minutes June 10, 2015 Page 2 of 5 DISCUSSION AND POSSIBLE DIRECTIVES TO STAFF 3. Proposed Guidelines Regarding Tenant and Landlord Responsibilities. Recommendations A. Find that discussion of the proposed Guidelines Regarding Tenant and Landlord Responsibilities is exempt under the California Environmental Quality Act (“CEQA”) because such is not a “project” as that term is defined in the CEQA Guidelines section 15378, and even if it were a project, it would still be exempt in accordance with Section 15061(b)(3), the general rule that CEQA only applies to projects that may have a significant effect on the environment; and B. Hold a discussion on the proposed Guidelines Regarding Tenant and Landlord Responsibilities and provide direction to staff regarding any revisions to said document and any additional work or related activities requested or required. Deputy City Administrator Kristen Enomoto introduced the item and highlighted the areas to be edited in the Guidelines. Commissioner Garcia arrived at the meeting at 6:07 p.m. Considerable dialogue and discussion occurred over the guidelines. Ms. Enomoto, Director of Public Works, Water and Development Services Kevin Wilson, and Legal Counsel Stuart Leviton responded to questions regarding: placement and responsibility of smoke and carbon monoxide detectors; definition of “wear and tear”; clarity of guidelines for tenants; number of inspections; etc. Commission reached consensus for staff to incorporate comments and/or suggestions into a final draft to be presented to the Commission at its next meeting. Further consensus was reached that, once finalized, the new guidelines should be provided to the tenants as soon as possible as well as being made available online. 4. Results of March 2015 Tenant Satisfaction Survey. Recommendations: A. Find that the receipt of the results of the March 2015 Tenant Satisfaction Survey is exempt under the California Environmental Quality Act (“CEQA”) because such is not a “project” as that term is defined in the CEQA Guidelines section 15378, and even if it were a project, it would still be exempt in accordance with Section 15061(b)(3), the general rule that CEQA only applies to projects that may have a significant effect on the environment; and B. Receive and file the results of the March 2015 Tenant Satisfaction Survey. Regular Vernon Housing Commission Meeting Minutes June 10, 2015 Page 3 of 5 Ms. Enomoto introduced the item as informational. Ms. Enomoto responded to questions from the Commission regarding “property tax” to be paid by the tenants. Both Ms. Enomoto and Mr. Leviton responded that the tax is a possessory interest tax required by the County to be paid for by the tenant; and, the tenant may then be reimbursed by the City. The information is in the lease agreement and will be an item to be emphasized in the guidelines. It was moved by Froberg and seconded by Kriste to receive and file the results of the March 2015 Tenant Satisfaction Survey. Motion carried, 6-0. 5. First Responder Leasing Priority and Related Issues. Recommendations: A. Find that discussion regarding the first responder leasing priority and related issues is exempt under the California Environmental Quality Act (“CEQA”) because such is not a “project” as that term is defined in the CEQA Guidelines Section 15378, and even if it were a project, it would still be exempt in accordance with Section 15061(b)(3), the general rule that CEQA only applies to projects that may have an effect on the environment; and B. Hold a discussion to consider whether first responders should continue to receive a priority in leasing residential units and related issues, including among other things, the on-going verification of first responder status, implications of changes in first responder status during tenancy, and occupancy requirements for first responders, and provide direction to staff regarding proposed procedures or related documents or information that should be presented to the Commission at a future meeting. Ms. Enomoto introduced the item and informed the Commission that this would necessitate a change in the City ordinance to be approved by City Council. The Commission had considerable discussion on the topic of the first responder priority for housing. On a motion by Haskell and a second by Kriste, the Commission voted to recommend to the City Council that the Council discontinue the priority in leasing residential units to first responders. The motion passed, 4-2 (Froberg, Garcia). JUNE LOTTERY AND WAIT LIST 6. In accordance with Section 3, Random Selection of Potential New Leasees, of the Vernon Housing Commission Lease-Up Procedures for New Tenants, separate lottery drawings of all Expression of Interest Forms and Unit -to-Unit Transfer Request Forms received between 5:01 p.m. on December 9, 2014, and 5:00 p.m. on Regular Vernon Housing Commission Meeting Minutes June 10, 2015 Page 4 of 5 June 9, 2015, will be conducted to create a wait list for all units that become available June 10, 2015 or later. Ms. Ayala announced that only one Unit-to-Unit Transfer Request was received, thereby not requiring a “lottery” action. Ms. Enomoto explained the Unit-to-Unit Transfer process. The Commission conducted the lottery. Any vacancy that opens from this day forth will utilize the list created this day. LOTTERY FOR REMODEL ORDER OF VERNON UNITS 7. In response to a recommendation by the Commission, the City Council has authorized the remodel of the seven Vernon units that were not remodeled in 2007/2008. In order to determine the order in which the units will be remodeled, a lottery drawing will be conducted. Ms. Enomoto briefly explained the remodel process and need for the lottery. The lottery was conducted with the order of the remodel to occur on each property as follows by street address number: 4321, 4323, 4324, 4325, and 4328. ORAL REPORTS & COMMENTS FROM STAFF AND COMMISSION MEMBERS 8. Update on City Council’s response and actions related to the Commission’s recommendation that the City sell all five City-owned housing units in Huntington Park. 9. Update on City Council’s response and actions related to the Commission’s recommendation that the City remodel the remaining seven City-owned housing units in Vernon that were not remodeled as part of the 2007/2008 remodel project to the same standard utilized in 2007/2008. Ms. Enomoto provided an update on both Agenda Items 8 and 9. 10. Presentation of fiscal year 2015-2016 budget. Ms. Enomoto provided a PowerPoint presentation on the 2015-2016 budget. 11. Quarterly housing report to be presented by the Director of Public Works, Water & Development Services. Director of Public Works, Water and Development Services Kevin Wilson provided a PowerPoint presentation on the city’s housing. 12. Vernon Village Park progress report to be presented by the Director of Public Works, Water & Development Services. Regular Vernon Housing Commission Meeting Minutes June 10, 2015 Page 5 of 5 Mr. Wilson provided a PowerPoint presentation on the status Vernon Village Park. 13. Brief reports, announcements, or directives to staff from the Commissioners and Commission Officers. Commissioner Haskell announced that his term on the Commission will expire prior to the next meeting. He thanked the City Council for allowing him to serve on the Commis sion, and staff for educating him on government procedures. Ms. Enomoto explained that four of the seven Commission positions would expire in August. Notice of vacancies will be announced by various means, with potential applicants to be presented to council no later than August. SECOND PUBLIC COMMENT Chair Hughes announced that this was the time allotted for public comment and inquired whether anyone in the audience wished to address the Commission. No public comment provided. With no further business, at 8:10 p.m. it was moved by Haskell and seconded by Ybarra to adjourn the meeting. Motion carried, 6-0. ________________________ Michael Hughes Chairperson ATTEST: _________________________ Maria E. Ayala Secretary REC f,VE.D sEP 0 3 2015 CIY CLERKSOFIICE STAFF REPORT CITY ADMINISTRATION DATE: TO: FROM: RE: September 9, 2015 Honorable Vernon Housing Commission Mark C. Whitworth, City Administrator/Commission Directo Originator: Kristen Enomoto, Deputy City Administrator Approval and Adoption of Proposed Guidelines Regarding Tenant and Landlord Responsibilities and Tenant Do's and Don'ts Recommendations A. Find that approval and adoption of the proposed Guidelines Regarding Tenant and Landlord Responsibilities and Tenant Do's and Don'ts are exempt under the Califomia Environmental Quality Act C'CEQA) because such is not a "project" as that term is defined in the CEQA Guidelines section 15378, and even if it were a project, it would still be exempt in accordance with Section 15061(bX3), the general rule that CEQA only applies to projects that may have a significant effect on the environment; and B. Approve and adopt the proposed Guidelines Regarding Tenant and Landlord Responsibilities and Tenant Do's and Don'ts. Background At the March 11,2015 meeting, one of the Commissioners requested that staff draft a document outlining the responsibilities of tenants in comparison to the responsibilities of the Landlord. At the June 10, 2015 meeting, staff presented a preliminary draft ofproposed Guidelines Regarding Tenant and Landlord Responsibilities ("Guidelines") for review and discussion. Based on the feedback and direction provided by the Commission, staff has finalized the draft ofthe proposed Guidelines and is presenting it herewith for approval and adoption by the Commission. Additionally, as requested by the Commission, staff is simultaneously presenting a proposed Tenant Do's and Don'ts reference sheet for approval and adoption by the Commission. Upon adoption of each, copies will be provided to each existing tenant, as well as to new tenants upon lease-up and lease renewals. Page I of 2 Fiscal Imnact There is no known or anticipated fiscal impact associated with the actions proposed in this staff report, other than to help further ensure the City does not pay for repairs or work that is the responsibility of the tenant. Attachment(s) 1 . Proposed Guidelines Regarding Tenant and Landlord Responsibilities 2. Tenant Do's and Don'ts Page 2 of 2 ATTACHMENT 1 Vernon Housing Commission Guidelines Regarding Tenant and Landlord Responsibilities Proposed September 9, 2015 Consistent with the terms of the standard Residential Lease ("Lease") for rental of City of Vernon owned residential property and related policies and procedures adopted by the Vemon City Council and/or the Vemon Housing Commission, the following is intended to serve as a set of general guidelines regarding the main responsibilities of the Tenant and the Landlord as identified in the Residential Lease. To the extent any of the guidelines below conllict with any of the provisions of the Lease, the provisions of the Lease shall govem. If you have questions regarding your responsibilities as a Tenant, you should contact City Housing at housinq@ci.vemon.ca.us or (323) 826- I 472. Tenant Responsibilities Overview A Tenant must take reasonable care of and maintain in a good, safe condition a Tenant's rented property and any common areas, such has hallways near his/her unit, to which a Tenaat has access and the right to use. A Tenant also must repair or pay for repair of any and all damage that he/she causes, or that is caused by a Tenant's children, occupants, guests, invitees, or pets as outlined in the Lease and Califomia Civil Code Section 1941.2. Tenant responsibilities include : o Inspection of residence prior to moving in to verifu that all appliaaces, landscaping, and fixtures including smoke detectors and carbon monoxide detectors, are in good and operable condition. Should something not be operational, the Landlord must be immediately notified in order to take corrective action. Keep the premises clean and sanitary. Use and operate gas, electrical and plumbing fixtures properly. Examples of improper use include overloading electrical outlets, flushing large, foreign objects down the toilet, and allowing any gas, electrical or plumbing fixtures to become filthy. Dispose oftrash and garbage in a cleal and sanitary manner. Do not destroy, damage, or deface the premises, or allow anyone else to do so. Do not remove any part of the structure, dwelling unit, facilities, equipment or apputenances, or allow anyone else to do so. Immediately nodry Landlord of any damage to or non-working smoke detectors and carbon monoxide detectors. Vernon Housing Commission Guidelines Regarding Tenant and Landlord Responsibilities Proposed September 9, 20 I 5 . Noti& the Landlord when door locks, window locks, security devices, smoke detectors, carbon monoxide detectors, or other such security or safety devices are not operating properly. o Storage areas and garages must be kept free of flammable or explosive materials, such as gasoline and ammunition. o Replace light bulbs in all I ighting sources on premises, except security lighting. o Noti& the Landlord of al I necessary repairs or replacements. The Tenant will be responsible for repairs or replacements caused by the Tenant, the Tenant's children, occupants, guests, invitees, or pets, or licensees of Tenant, excluding normal wear and tear. Such repairs or replacements can be done by the Tenant, a licensed and insured contractor on behalf of the Tenant, or by the Landlord at the Tenant's expense. - Repairs caused by the Tenant may include, but are not limited to, a clogged drain due to excessive hair in the drain, or a broken garbage disposal. - Normal wear and tear may include, but are not limited to, a leaky pipe or faucet, or cracked or peeling paint. o Tenant will be charged for all damage to premises resulting from failure to report a problem in a timely manner. Landlord Responsibilities Overuiew The Landlord is required to maintain the habitable condition of its rental properties. During the term of any Lease, the Landlord is responsible for maintenance, repairs, and replacements that are the result of normal wear and tear and are necessary to keep the property habitable. The Landlord is NOT responsible for repairing damage caused by the Tenant or the Tenant's children, occupants, guests, invitees, or pets. Landlord responsibilities include: o Effective waterproofing and weather protection of the roof and exterior walls, including windows and doors. e Maintenance of plumbing facilities in a proper working order, including hot and cold running water, and connection to a sewage disposal system. . Maintenance ofelectric, gas, heating, and air conditioning systems in proper working order. Vernon Housing Commission Guidelines Regarding Tenant and Landlord Responsibilities Proposed September 9, 20 I 5 . Clean and sanitary buildings, grounds and appurtenances (for example, a garden or a detached garage), if any, which are free from debris, filth, rubbish, garbage, rodents and vermin (except that debris, filth, rubbish, or garbage caused by the Tenant shall be cleared at the Tenant's expense). r Adequate trash receptacles in good repair. o Floors, stairways and railings in good repair. o A working toilet, wash basin, and bathtub or shower. The toilet and bathtub/shower must be in a room that is vented (either by mechanical means or by an openable window), and that allows for privacy. . A kitchen with a sink, which is made from a nonabsorbent material such as cast iron, porcelain, or steel. o Natural lighting in every habitable room through windows or skylights. A window in each habitable room must be able to open unless there is a mechanical ventilation system provided. . Safe fire or emergency exits leading to a sfeet, hallway, parking lot or assembly area. Stairs, hallways and exits are to be kept litter free. o Operable locks on the main entry doors aad operable locks or security devices on the windows. . Replace light bulbs in all exterior security lighting sources on premises. o Ensure all smoke detectors and carbon monoxide detectors are in proper working order at time of move-in, and check said mechanisms annually to ensure continued operation, incl uding replacement ol baneries. ATTACHMENT 2 Forthcoming 9/8/15 RECEIVED sEP 0 3 2015 CITY CLERK'S OFFICE STAFF REPORT CITY ADMINISTRATION DATE: TO: FROM: RE:Approval and Adoption of Proposed Procedures for Tenants under First Responder Priority Recommendations A. Find that approval and adoption of the proposed procedures for tenants under first responder priority is exempt under the Califomia Environmental Quality Act C'CEQA) because such is not a "project" as that term is defined in the CEQA Guidelines Section 15378, and even if it were a project, it would still be exempt in accordance with Section 15061(bX3), the general rule that CEQA only applies to projects that may have an effect on the environment; and B. Approve and adopt the proposed procedures for tenants under first responder priority. Background At the June 10, 2015 meeting, the Commission voted to submit to City Council a recommendation to discontinue the first responder leasing priority. After much discussion over several meetings, the City Council voted on August 18, 2015, to maintain the first responder leasing priority as is. As discussed preliminarily at the last Commission meeting, with the continuation of the first responder leasing priority, the following issues/questions need to be ad&essed: 1. How should on-going first responder status be verifred? 2. What should happen ifthere is a change in first responder status during tenancy? 3. Should there be any specific occupancy requirements for first responders? Based on the discussion at the last meeting, and with the assistance and guidance of legal counsel, staff has drafted the proposed Procedures for Tenants under First Responder Priority for review and approval by the Commission. September 9, 2015 Honorable Vernon Housing Commission Mark C. Whitworth, City Administrator/Commission Director Originator: Kristen Enomoto, Deputy City Administrator Page I of2 Fiscal Imnact There is no known or anticipated fiscal impact associated with the adoption and implementation of the procedures proposed in this sta{T report. Attachment(s) 1 Procedures for Tenants under First Responder Priority Page 2 of 2 Vemon Housing Commission Procedures for Tenants under First Responder Priority Proposed September 9, 2015 Pursuant to Ordinance 1183, as amended, and the Vemon Rental Housing Policy C'VRHP), the Vemon Housing Commission ("VHC") hereby adopts the following procedures to address issues relating to leasees who benefited from a priority on the City housing waiting list because of their "first responder" status. Recitals A. The VHC is committed to managing its housing stock according to "best practices" for private, residential housing. The VRHP requires that all procedures be "neutral, fair and reasonable." B. Under the existing policies and procedures goveming the subject housing stock, certain "first responders" are given a priority on the City's housing waiting list solely because oftheir first responder stanls. C. Since the initial implementation ofthe first responder priority procedure, certain questions and concems have arisen with respect to this priority status that require clarification. D. The VHC desires to adopt additional procedures with respect to leasees who have benefrted from a first responder priority status that are "neutral, fair and reasonable." The VHC recognizes that there must be a balance between the public policy which supports the first responder priority status and the VHC's commitment to and obligation to all other leasees and prospective leasees. Procedures l. Certification and Annual Re-certification ofFirst Responder Status. a. Initial Certification. Before any prospective leasee is given a first responder priority status on the City's housing waiting list, the City must verifu that the prospective leasee is indeed a "first responder" as defined by VHC procedures. At least the following steps shall be undertaken to verifu the status ofa prospective leasee: i. Any prospective leasee desiring to benefit from a first responder priority shall promptly provide the City with all information reasonably requested by the City to verifr his/her status. ii. Thereafter, the City shall use all reasonable efforts to verify such status accurately and promptly. If the City is unable to veriff the status to the City's reasonable satisfaction, the City shall notifu the prospective leasee in writing ofthis fact, and if appropriate, request additional information to assist the City in verifuing the status. iii. If additional information is requested, the prospective leasee shall provide it promptly and the City shall evaluate it. This interactive process shall continue until either the City can veriff the first responder status, the prospective leasee fails to provide additional information, or the City concludes that the prospective leasee does not qualiry for first responder status. iv. At the end of this process, the City shall notifr the prospective leasee in writing as to its conclusion. v. The ultimate burden ofproducing suffrcient documentation and information to support a finding of first responder status shall remain with the prospective leasee. vi. Any communication required to be in writing may be communicated via email to the last known email address of the prospective leasee. b. Annual Re-Ce(ification: Because ofthe public policy behind providing first responders with a priority in obtaining City-owned housing, if a current leasee was given a first responder priority at any time and benefited from that priority in obtaining his/trer current housing unit, either directly (initial move-in into the unit) or indirectly (housing transfer), the leasee must certifu on an annual basis that the leasee remains a qualified first responder who is entitled to a continued priority. At least the following steps shall be undertaken to verifu the status of the leasee: i. At the time of lease renewal, if the leasee has a l2-month lease, or at least annually, the leasee shall provide the City with all information reasonably requested by the City to verifo his/her continued status as a first responder. ii. Thereafter, the City shall use all reasonable efforts to veriff such status accurately and promptly. If the City is unable to verift the status to the City's reasonable satisfaction, the City shall notifu the leasee in writing of this fact, and if appropriate, request additional information to assist the City in verifuing the status. iii. If additional information is requested, the leasee shall provide it promptly and the City shall evaluate it. This interactive process shall continue until either the City can verifu the first responder status, the leasee fails to provide additional information, or the City concludes that the leasee does not qualift for first responder status. iv. At the end of this process, the City shall notift the leasee in writing as to its conclusion. v. The ultimate burden of producing suffrcient documentation and information to support a finding of first responder status shall remain with the leasee. vi. Any communication required to be in writing may be communicated via emai I to the last known email address of the leasee. 2. Changes in First Responder Status. For any leasee who has benefited from a first responder priority, ifthere is a change in that status, the following procedures will apply depending on the reason for a change in status: a. Loss ofFirst Responder Status Due to Separation from Employment. Except as provided in Subsections (b) and (c) below, if a leasee was employed as a first responder and separates from his/her employment for any reason and, thereafter, is no longer employed as a qualifoing first responder, the leasee may remain in their housing unit until the end ofthe lease term, ifthey have a lease for a fixed period, or for up to six months following the loss of qualiffing first responder status, whichever is longer. The leasee shall notifr the City promptly following the loss of qualifring first responder status. The leasee will not be entitled to renew his/her lease for an additional 12-month period. At the end of this grace period, the leasee and all authorized occupants must vacate the housing unit unless either there are no prospective leasees on the then current housing waiting list, or any prospective leasees on the housing waiting list or any leasees on the transfer list do not want the unit that would be otherwise vacant.b. Death or Permanent Disability of First Responder. In the event a first responder leasee who qualified for a priority dies or becomes permaaently disabled in the line of duty, no one then residing in the housing unit shall be required to vacate the housing unit solely because of the death or permanent disability ofthe first responder.c. Temporarv Loss of First Resoonder Status. If an otherwise qualified first responder temporarily loses his/her qualifying first responder status, he/she shall not be required to vacate a housing unit so long as the qualifying first responder status is regained as specified herein. A "temporary" loss shall be for a period not to exceed three months and shall be as the result of a change in employment. If at the time ofan annual recertification, the leasee has temporarily lost his,4rer first responder status, the annual recertification shall be defened to afford the leasee an opportunity to regain qualifying first responder status. The length of the deferment shall be no longer than 90 days following the loss of qualifying first responder status. 3. A Oualiffinq First Responder's Use of the Housing Unit. If a leasee obtains a housing unit via a first responder priority, it is the expectation that the first responder will, in fact, reside in the housing unit for a meaningful amount of time. It shall not be permissible for a leasee to obtain a housing unit via a first responder priority and then not use the housing unit personally (only authorized occupants actually residing in the housing uniQ. No frxed standard shall be established by which to measure "meaningful." "Meaningful" may vary depending on a first responder's particular work schedule. Ifa question arises as to whether a leasee is meeting this requirement, the City shall give written notice to the leasee, who then shall provide reasonable documentation and information to the City to demonstrate compliance with this requirement. If a leasee fails to demonstrate that he/she is complying with this requirement, the city may terminate the leasee's lease, and the leasee and all authorized occupants will be required to vacate the subject housing unit. RECEIVED sEP 0 3 2015 CITY CLERl('S OFFICE STAFF REPORT CITY ADMINISTRATION DATE: TO: FROM: RE: September 9, 2015 Honorable Vernon Housing Commission Mark C. Whitworth, City Administrator/Commission Directorl Originator: Kristen Enomoto, Deputy City Administrator Preliminary Discussion Regarding Potential Market Rent Remodeled in Fiscal Year 201512016 Recommendations A. Find that discussion of market rent is exempt under the Califomia Environmental Quality Act ("CEQA") because such is not a "project" as that term is defined in the CEQA Guidelines section 15378, and even if it were a project, it would still be exempt in accordance with Section I 5061 (b)(3), the general rule that CEQA only applies to projects that may have a significant effect on the environment; and B. Hold a preliminary discussion regarding potential market rent for units to be remodeled in fiscal year 201512016. Backsround On March 11, 2015, the Commission voted to once again recommend that the City Council sell the five City-owned units in Huntinglon Park at fair market value based on a professional appraisal of each unit. The Commission also voted at that time to recommend to City Council that the seven units that were not remodeled in 200712008 be remodeled to the same standard applied in 2007 /2008. The proposed 201512016 remodel is expected to cost slightly over $100,000 per unit. On April 7,2015, the City Council directed staff to remodel the seven subject units (two at a time) applying the same standard utilized in 200712008, and voted to sell three of the five City- owned units in Huntington Park and retain the other two units for the temporary relocation of tenants affected by the remodel. Page 1 of3 On June 10, 2015, the Commission conducted a lottery to establish the order in which each unit would be remodeled. Since that time, a couple of tenants have expressed interest in deferring or opting out of the remodel. In order to be fair, staff recommended that the City Council provide all seven tenants a one-time, opt-out opportunity, which the Council authorized on August 4, 2015. In order to enable tenants to make a fully informed decision, staff believed an updated market rent survey was in order. As such, staff ordered an updated survey for the seven subject units that would provide the current market rent for each unit in its current condition, as well as the current market rent for each unit in its fully remodeled condition. The updated survey was provided by Gold Coast Appraisals, Inc., ("Gold Coast") which is the appraisal company the Commission selected through a competitive process for the initial market rent survey conducted in early 2012. Since it is entirely within the Commission's purview to set the rents for City-owned units, consistent with the market rent provisions of the Vernon Rental Housing Policy adopted by the City Council, staff would like to obtain some feedback and direction from the Commission on the results ofthe updated market rent survey before proceeding any further. The updated rent survey prepared by Gold Coast is attached herewith. The market rent implementation schedule currently in effect is also attached for historical reference and comparative purposes. The far right-hand column of the schedule labeled "3/1/2015 Year 4" reflects the market rent currently in effect for each unit as ofAugust 1,2015, and the highlighted rows indicate the seven units proposed to be remodeled in fiscal year 201512016. The remaining Vernon units were all remodeled in 200712008. The Vernon units on 50th Street are apartments, whereas the units on Vemon Avenue, Fruitland Avenue, and Furlong Place are all single family homes. The units located in Huntington Park are not applicable to this discussion as those units are in the process of being sold and utilized for relocation purposes during the proposed remodel project. Additionally, for the benefit of newer Commission members and to aid the discussion, staff will present a number of older rent-related documents at the meeting. The most conceming element for staff at this point is the marginal increase in monthly rent ($100) that $100,000 worth of remodel work would yield based on the updated rent survey. Notwithstanding market-driven future rent increases, these figures represent an 83-year payback for the City. This is the same concem staff had during the initial rent survey and rent setting process in 2012. As the market rent implementation schedule reflects, the biggest difference in monthly rent between a comparable remodeled unit and a non-remodeled unit is $71. Interestingly enough, it is in 2012 that one might expect to see the greater difference in monthly rent between remodeled and non-remodeled units given that the comparisons at that time were between units built in the 1940's and 1950's (and never significantly remodeled, although very well-maintained over the many decades) and units that were remodeled to nearly brand new levels in 2007 ar,d 2008. Whereas now, we are comparing 200712008 units to 2015/2016, with all work, materials, finishes, appliances, etc. being of equal standard. Dissimilar to the remodel adjustment, the updated rent survey indicates that the inclusion of upgraded appliances would yield a significant increase in monthly rent (S103) relative to the cost of providing the appliances (approximately $5,000 in total, notwithstanding ongoing maintenance and repair costs), which would represent a 4-year payback for the City. Page 2 of3 At a minimum, staff recommends exploring further the reasons the post-remodel increase appears very modest relative to the remodel cost, and assuming the post-remodel increase remains so limited, whether the contemplated level and associated cost of the proposed remodel is justified in light of current market conditions. Although any potential change in the scope of the remodel would be at the sole discretion and authority of the City Council, the Housing Commission's contemplated plans regarding updates to market rents would be a key factor for Council to consider in any such decision. Fiscal Imoact The fiscal impact is not known at this time. However, the important factor to consider at this time is the anticipated rate of retum the monthly rents will yield for any significant remodel investment. Attachment(s) 1 . Updated Rent Survey Prepared by Gold Coast Appraisals, Inc. 2. Market Rent Implementation Schedule Effective Ilul:le 12,2013 Page 3 of 3 ATTACHMENT 1 C}CA ( iol<l (ira*t .\pprai*a1.,, lnc. I m 15 Piroc.r Blvd. Sufu lt0 Satr Fc SFirF, CA 90670 P[oc (562) 65r-r058 FAX(562) 651-t05E cqp6a€toLd.ost{pr.irl..c@ August 21 , 2Ol5 Kristen Enomoto City of Vernon 4305 Santa Fe Ave. Vernon, CA 90058 Dear Ms. Enomoto, At your request, I compfeted my analysis of the monthl-y rentaf rates for the foflowing residential properties: lyPe 3 Bedroom 3 Bedroom 2 Bedroom 2 Bedroom 2 Bedroom 2 Bedroom 2 Bedroom Stleet Ad&ess 3361 Eruitfand Ave. 4 321 Furlong P1. 3365 Erultfand Ave. 4323 Furlong P1. 4324 Furlong Pl. 4325 Furfong Pf. 4328 Furlong P1 . City Location Vernon Vernon Vernon Vernon Vernon Vernon Vernon Regardless of who pays for the attached market renta.I report, it has been prepared for our cl.ient: the City of Vernon. As spec.ified by the cl-.ient, the purpose of the appraisal- is to estimate current fair market rental, rates and the fair market rental rates based on the provided remodef for the above mentloned properties. The c.Iient lntends to use this report in negotiating a renta.I rate for the tenants at these focatlons. I5012000N, RCS Vernon Prope! Lies The attached Sunmary Renta.I Report has been prepared in accordance with the reporting requj-rements of the Uniform Standards of Professional Appralsa.I Practice (USPAP) . This Rental Report may not be used or relied upon by anyone other than the above-mentioned cfient for any purpose whatsoever, without the express written consent of the appraiser. If the client provides anyone else with a copy of this report, such as a borrower etc., that person(s) may not be entitfed to rely upon its contents when making any decisions about the property. As such the following limiting condition applies: Neither all nor any part of the contents of thj-s report shal-f be conveyed to any person or entity, other than the appraiser's or firm's client, through advertising, so.Iicitation materiafs,public refations, new, sa.Ies, or other media without the wrj-tten consent and appeal of the author, particularly as to vafuation conclusions, the identity of the appraiser or firm with whlch the appraiser is connected, or any reference to the Appraisal Institute or the MAI, SRA designation. Furthermore, the appraiser or firm assumes no obligatlon, 1labi1ity, or accountabifity to any third party. If this report is placed in the hands of any one, but the client, the client shafl make such party(s) aware of all the assumptions and limiting conditions of the assignment. Shoufd you have any questions regarding the analysis conclusions found in the attached report, please contact me. Sincerely, .a{-Z- Z Hee K. Yi Certified General Appraiser AG 035644 Expires 1l/76/2A16 or 15032 000N, RCS vernon Properties falrle of Contents Table of Contents .... ..... .. 3 Cfient -.. -.. -. 4 Appraiser. .... .....,. 4 Effective Date the Assignment ...... 4 Date of Report . .... .. 4 Competency Provision. ..... .. 4 Confldentiality.... ....... .. 4 Summary Fair Rental Report ....... .. 5 Intended User.. ...... 5 Intended Use... ----,- 5 Reaf Estate Locatlons ....... 5 Overview of the Asslgnment ... ,... .. 5 Scope of the Assignment.... ........ 5 Definition of Market Rent.. .,...... 6 Neighborhood Description. ... .... ... 7 zonlng. ....... I Property Descriptions ....... 8 D6^l-.] l^al rrci e O Addendum. .... L4 Certlflcation. .... ...... . 15 Assumptions and Limltlng Condltions .... 71 Quafifrcations .... .....,. 20 Subject and Rental Photographs ....,.... 23 .t5012000N, FCS vernon Properties 3 CIient The City of Vernon 4305 Santa Fe Ave. Vernon, California 9005I Atr praiser Hee K. Yi Gold Coast Appraisafs Inc. 10015 Pioneer BIvd. Santa Fe Sprlngs, California 90670 Effective Date the AssigrlDent The effective date of this assignment is August 25, 2015. The buildings were inspected on August 25, 2075. The appraiser made exterior inspectlons of the properties. A11 properties were viewed from the street. Date of Report Hee K. Yi wrote this report August 21 , 2015. Coqretency Provision Hee K. Yl has the necessary educational background and fiefd experience to perform this asslgnment her qualiflcations are found in the addenda. She is a Cafifornia Certified General Appraiser (AG035644). Confidentia].ity The appraiser must be aware of, and comply with, al-] confidentiality and privacy faws and regulations applicable in an assignment. Discl-osure of confidentlal information ispermissible to professional peer review committees, except when such disclosure to a comm.ittee woufd viotate applicabfe faw or regulation. Confidential- Information means informat.ion that is either ldentified by the client as conf.ident.ia.I when providing it to an appraj-ser and that is not available from any other source; or classified as confidentia.I or private by appficabfe Iaw or regulation. I5012000N, RCS vernon Properries 4 Su--ary EaiE Rerrtal Report This Renta.l- Summary Report complies with the reporting requirements set forth under Un.iform Standards of Professional- Appraisal Practice (USPAP) as weff as those promu.Igated by the Appraisal Institute. As such, it presents a sunmary of the data, reasoning, and analyses that were used in the appraisa] process to develop an opinion of a current monthfy renta.L rate. Intended User The City of Vernon is the intended user of this report. IDtended use The City of Vernon intends to use this report in negotiating a monthfy rentaf rate for the houses that are owned by the City of Vernon. ReaI Estate locatiorts qpe 3 Bedroom 3 Bedroom 2 Bedroom 2 Bedroom 2 Bedroom 2 Bedroom 2 Bedroom Street Addless 3361 Eruitland Ave. 4 321 Furlong Pl . 3365 Eruitland Ave. 4323 Furlong P1 . 4324 Eurlong P1 . 4325 Eurlong P1 . 4328 Eurlong P1 . City Location Vernon Vernon Vernon Vernon Vernon Ve rnon Vernon Overvier of ttre AsEigrrDent Because nearly every house is owned by the City of Vernon, there are no rentaf properties within the Clty boundarles that can be surveyed to ascertaln a market rentaf rate. City enployees that need to be housed in proxlmlty to their work location can opt to obtain housing in the cities and communities that are adjacent to Vernon. Huntington Park, South Gate, MayHood, East Los Angel-es, Los Angel-es, BefI, Lynwood, and City of Cornmerce have housing stock that is s.im.i.Iar to the Vernon f ocated houses. Scope of ttre AssigurDent The appraiser performed the following tasks in order to ascertain the current market monthly rental rate as of August 25, 2015 and the market rental rate for each property based on 15032000N, Rcs vernon properties the provided remodel. The scope of work about the remodeJ-ing of the properties was provided by the client. GoId Coast Appraisafs conducted the prior rental survey as of Novernber L7, 20L1. The staff of Gold Coast Appraisa.Is inspected the interj-or andexterior of the properties on November 11 , 2OIl thus the interior informatlon of the properties was obtained from theprior report of rentaf survey. Viewed the exterior for the rental properties,' Viewed a]1 of the properties from the public thoroughfares; Reviewed the descriptions of City owned residential properties; Utifj-zed internet rentaf sltes and multiple listj-ng leasing informatlon to obtain rental rates; Selected leased or for lease properties that have physicaf characteristics that are similar to the subject properties,' Conducted an exterior inspectlon of each rent comparable; Reviewed aff the pertinent information avallabIe for each rental; Contacted owners and feasing agents to verify physj-caI characterlstics of the rentals; Analyzed the data making adjustments for the superior or inferior characterj-stics that impact renta.l- rates; Made positive or negatlve adjustments for those characteristics that impact rents; . Reconclfed the adjusted rents and reached a finaL rent concfusion for each focation, Definition of Market R€nt The most probable rent which a property wifl bring in a competitive and open market under af l- conditions requlsite to a fair rent, the owner and tenant, each acting prudentJ-y, knowledgeably and assuming the rental rate is not affected by undue stimufus whereby: Owner and tenant are typically motivated; Both parties are we.Il informed or wefl advj-sed, and actlng in what they consider their own best interest,. A reasonabfe tlme is allowed for exposure in the open market; 15032000N, RCS Vernon Properties 6 Payment is made in terms of cash financj-aI arrangements comparable Neighborhood Description U.S. doll-ars or in terms of thereto. xJ City of Vernon Locations Industrial and commercial properties dominate the property uses found in Vernon. Over the past severaf years most of the older structures have been replaced with modern concrete tift-up buildings des j-gned for fight and heavy manufacturing. Many cold storage facilitj-es have relocated to Vernon from the Centra.l- Business District of Los Ange.Ies. Many of the industrial- uses have access to raif road spur l-ines that are just a short dlstance from the main freight carrying rail fines. Vernon's residentj.al properties conslst of 18 single family homes and one apartment building a]]- of which are owned by the City and occup.ied by City empfoyees. These properties are .Iocated adjacent to City owned facilj,tj-es and are surrounded by privateJ-y owned industrial uses. 15032000N, Rcs vernon properties 7 Because Vernon lacks the infrastructure to service locaI resldents, they must utilize fac.ilities found in the surrounding Citi-es of Maywood, East Los Angeles, Huntington Park, Bell and City of Commerce. Access to these adjacent citles is v-ia Atfantic B1vd., Slauson Ave., Bandini Blvd., Soto St., Alameda St., Santa Ee Ave. and Washington Blvd. Vernon is also conveniently .Iocated to the Long Beach and Santa Ana freeways whlch provide resldents and business access not on]y to the surrounding communities but to the Central Business Dlstrict of Los Angefes and the Ports of Los Ange.Ies and Long Beach. Zoning The propertles that reside in the City of Vernon are zoned for manufacturing uses. Property Descriptions Eurlong Pface Hous es The five homes have no kitchen appliances and have tile counter tops, The bathrooms have a tub with an overhead shower, vanity, and tile wainscotlng surrounding the tub. The rooms have hardwood or vinyl flooring. Each home has a hot water tank, central heating and air conditioning. The houses have a laundry room, The houses have access to individuaf storage spaces that are focated in ther-r fenced rear yards. Each house has an assigned street parking stal-f but they can al-so utifj-ze the adjacent city parking areas. The tenants pay for aIl utilities and trash plck-up. unit # 4327 4323 4324 4325 4328 Eruitfand Ave Houses Two one story houses are in the City of Vernon. have the same physica.I 15032 00 0N. RCS vernon Properties Sq. Ft. 1,258 7,061 1,061 1,019 1,061 located at 3351 and 3365 Fruitland Ave. The houses were constructed 1957. They characteristics as the Eur.Long P1. BedlooEs Baths Three One Two One Two Two Two One One One properties. One of the houses has a 2 car garage and another has a one car garage. The tenants pay for all utilities and trash pick-up. Uait * Bedrooms Baths Sq. Ft. 33 61 Three One 1,305 3365 Two One 931 The appraiser assumed that alf of the properties were in rent ready condition and that they did not suffer from any major deferred malntenance or any significant code violations. 1503200 0N. Rcs vernon properties 9 Rental Analysis 2 bedroom (before remodeling) Renl Comparubility Gtid Y:Yes; N:No Estimrt€d Mrrlet RenL/ Sq. Ft 15032000N, A.CS Vernon properries 10 3 bedroom (before remodeling) Refi Comparubility Grid Eftetive Renl & Ren/ Sq. Eltituled M.rk€r Rena/ Sq. Ft 15032000N, B.CS vernon properties 11 Rental ConcLusion Addr65 Street Bedrpoms/ Bathroollrs 311 211 311 211 211 211 MXEttlelrb $te Gree (x) 5 25 u2) 3 EflddiB didneit $m5m $lm 5ffi$m$m $lm 3351 3365 4321 4323 4324 4315 4328 Fruitland Ave. Fruitland A're. FurlorE Pl. FudorgPl. FudorE Pl. FurlorB Pl. Fudorg PI. Vernon Vernon Vernon Vefipn Vemon Vernon Vermn Morthly S{, FL B€dma Reit 1105 s 1,850 931 s 1,58s 1258 $ 1,850 1067 5 1,s8s 1057 $ 1,585 1079 s 1,585 1057 $ 1,s85 c!ffent Monthly Martet Rent ReflDdeled Ma et Rent 2,053 l,T9 2,041 1,788 1,788 1,i91 1,788 1"850 t5i6 1,838 1,585 1,585 1,588 1,585 Miances 103 103 103 103 103 103 103 Ad,ustment to th B€rchmark Rent Ste adjusun€d Gar4e Adjunment Remo&liry Adjustments Applinnces Refrigerdtor Stove Disluashr Micrc{avE Street address 16040 Leffingwell Rd #18 16040 Leffingwell Rd #22 10330 DowneyAve. 11000 Woodruff Ave. As shown above, $50 to 5125. The s{8 52s to s10 0.25 per sq. ft. $50 for 2 Qrs and 525 for I Gr $lm City Bedroom/bath Living size Remodeled Rent Difference whittier 2bed/2bath 960 Yes 51,700 whittier 2bedl2bath 960 No s1,575 s125 Downey 3bed/3bath 1540 Yes Downey 3bed/3bath 1541 No the difference of rental rate for remodeling is conc.Iuded adjustment for remodeling is $100, Remodellng Adj ustment The fouoring 1= "" example of the difference before and after remodeling. Based on our research, livlng s.ize does not significantly impact the dlfference of rentaf rates for remodel-ing but rather it is a total dollar difference. The information is derived from MLS. s2,2@s2,1s0 sso Adjustments of kltchen appfiances Based on the website (rentafridge . com) , the range of monthly rentaf rates for 10-14 Cu.ft refrigerators is S23.99 to 526.99. The concfuded adjustment for refrigerator is $25.00. This amount is applied to only the main grid because most of refrigerators provided by owners are standard types (10-14 cu.ft). However, the city of Vernon provides more expensive refr.igerators based on the remodeling budget, so the hlgher adjustment of $48 is 15012000N, RCS Vernon Properties l2 appfied to the rental conclusion. According to the website, the rentaf rate per month for the refrigerator whj-ch have similar price of the refr.igerator which is provided by the City of Vernon is $48. Since there is not enough data for rental rates of other appliances, the concluded adjustments of stove, dishwasher, and microwave are derived from the rental rate of refri-gerator based on their prices which are provided by the client. The above chart represents the each property. As mentioned adjusted for any di fferences benchmark conclusion. market rental- rate appficable to earlier, a bench mark rent is between each property and the Photographs of several of the sublect properties afong with photographs of the rent comparables are found in the addendum of this report. If you have any questions regarding this analysis please contact me. S incere 1y, ,.a{-Z^ f Hee K. Yi Certified General Appraiser AG 035644 Expires 71/76/2016 I5012000N. BCS Ve r non Proper-ies 13 Addendum .t 5032000N, RCS vernon P!operties 74 CeEtification 15032 000N, RCS vernon Properties 15 Certification I, certify that to the best of my knowledqe and belief: 1. The statements of fact contained in this report are true and correct. 2. The reported analyses, opinions, and conclusions are limited only by the reported assumptions and liniting conditions, and is my personal, impartiaL, and unbiased professional analyses, opinions and concfusions. 3. I have no present or prospectlve interest in the property that j-s the subject of this report, and no personal- interest with respect to the parties involved. 4. T have no bias with respect to the property that is the subject of this report or to the partles involved viith this assignment. 5. My engagement in thls assignment was not contingent upon devefoping or reporting predetermined results. 6. My compensation for completing this assignment is not contingent upon the development or reporting of a predetermined value or direction in value that favors the cause of the cfient, the amount of the value opinion and the attainment of a stipufated result, or the occurrence of a subsequent event directly related to the intended use of this applaisaI. '1 . My analysis, opinions, and conclusions were developed, and this report has been prepared, in conformity with the Uniform Standards of Professional Practice. B. T made an exterior inspection of the property that is the subject of this report. 9. No one else provided professional assistance to the person signing this report . 10. I am competent to compfete this report in accordance with the competencyprovision of USPAP. raaz- f Hee K. Yi Certif ied ceneral Appraiser AG 035644 Expires 17/16/2a16 15032000N, RCS vernon Properties l6 Assuryrxions and Lieixinq Condixions 15032000N, RCS vernon Prope.ties l1 ASSIn'{PTTONS A}ID IIMITING COIIDITIONS As aqreed upon with the client prior to the preparation of this appralsal, this is a Narrative Report. This is a Sunmary Narrative Report, which is intended to compfy with the reporting requirements set forth under standard Rule 2- 2la) of the Uniform Standards of Professional Appraisal Practice for a Sununary Appraisal Report. ?he information contained in this report is specific to the needs of the cfient and for the intended use stated in this report. The appraiser is not responsibfe for unauthorized use of this report. No responsibility is assr.med for leqal or title considerations. Title to the property is assumed to be good and marketable unfess otherwise stated in this report. The property is appraised free and clear of any or aff liens and encumbrances unless othernise stated in this report, Responsible ownership and competent property management are assllmed unless otherwise stated in this leport. The information furnished by others is believed to be refiable. However, no warranty is given for its accuracy. AIf engineering is assumed to be correct. Any plot plans and illustrative material in this report are included onLy to assist the reader in vlsuafizing the property. It is assr.med that there are no hidden or unapparent conditions of the property, subsoil, or structures that render it more or less valuable. No responsibility is assr.med for such conditions or for arranging for engineering studies that may be required to discover them. Tt is assumed that there is fufl compfiance with all appficable federal, state, and loca1 environmental regufations and faws unless oLherwise srated in Lhis .repor!. 1. 2. 3. 4. 5. 6. -l . B. 10.It is assumed that all applicable zoning and use regufations and restrictlons have been complied with, unless non-conformity has been stated, defined, and considered j-n this appraisal report. t5032000N, RCS vernon Properties 18 11. Any sketch in this report may show approximate dimensions and is included to assist the reader in visualizing the property, Maps and exhibits found in this report are provided for reader reference purposes only. No guarantee as to accuracy is expressed or implied unfess otherwise stated in this report. No survey has been made for the purpose of this report. 12- 13. t4. It is assumed that the utllizatlon of the land and intelim use improvements are !^/ithin the boundaries or property fines of the property described and that there is no encroachment or trespass unless otherwise stated in this report. The appraiser is not qualified to detect hazardous waste and/or toxic materials. Any cornment by the appraiser that might suggest the possibility of the presence of hazardous waste and/or toxic materials nould require investigation by a qualified expert in the fiefd of environnental assessment. The presence of substances such as asbestos, urea- formaldehyde foam insufation or other potentially hazardous materials may affect the value of the property. The appraiserrs value estimate is predicated on the assunption that there is no such material on or in the property that woufd cause a foss in vafue unless otherwise stated in this report. No responsibility is assumed for any environmental conditions or for any expertise or engineering knowfedge required to discover them. The appraiser's descriptions and resulting conments are the result of the routine observations made during the appraisal process. The distribution, 1f any, of the total valuation in this report between fand and improvements applies only under the stated program of utili,zation. The separate allocations for land and buildings must not be used in conjunction vrith any other appraisaf and are invalid if so used. Neither all nor any part of the contents of this report (especiafly any concfusions, the identity of the appraiser, or the flrm lrith which the appraiser is connected) shalf be disseminated to the pubfic th:rough advertising, pubfic relations, news sales, or other media i./ithout prior written consent and approval of the appraiser. 15, Possession of this report, or a copy thereof, does not carry with it the right of publication. It may not be used for any purpose by any person other than the party to whom it is addressed without the written consent of the appraiser, and in any event, only with proper written gualification and only in its entirety. 16. 15032000N, RCS vernon Properties 19 Qualifications 15032000N, RCS vernon Properties 20 Hee K. Yi 10016 Pioneer Blvd. Suite 1 10 Santa Fe Springs, CA 90670 (714) 329-8336 e-mail:corporate@goldcoastappraisals.com Qualifications . Ten years experience in commercial real estate appraisal industry in the Southern California region; consultation, rental survey and analysis, feasibility studies, desk review and report writing.. Assesses properties and all real estate value types for purchase and refinance lending purposes as well as claims, tax re-assessments, liquidation and foreclosure, probate cases, new constructions, and renovations.. Exceptional ability to simultaneously manage complex appraisal projects while meeting rigorous performance standards and demanding schedules.. Excellent project management, business, and interpersonal skills with the experience required to remain highly focused and exceptionally productive in faslpaced settings.. Possesses intricate experiences and knowledge of Asian-American Community and its banking and lending industries in the Southern California region. Fluent in Korean language and culture. Kev Achievements . Appraised large hotels and motels in the following cities: Pasadena, Escondido, Cathedral City Bakersfield and various small motels in the cities of Los Angeles and Long Beach.. Appraised an industrial land in Riverside with Eminent Domain lssues.. Valued Commercial land for the city of Long Beach.. Analyzed and appraised special use purpose (church) and office/retail mixed uses in Los Angeles County.. Appraised small and large mufti-family properties in Los Angeles, Orange, Riverside and San Bernardino Counties.. Performed valuations for property settlement in divorce proceedings-. Completed fair rental valuations for tenants' rights attorneys.. Completed Fair Market Rental reports for HUD and private parties.. Appraised foreclosure and problem loan properties.. Appraised all types of properties for Federal Estate Tax Returns.. Appraised 12 medical buildings of Alta Med Health Services Corp. in Los Angeles County.. Low income housing for Restore Neighborhood Rehabilitation (City of Los Angeles).. Low income housing for City of Santa Ana. Professional Exoerience Gold Coast Appraisals, lnc. JM United Appraisals lnc. 2005 to Present 2004 - 2005 15032000N, RCS vernon Properties 27 Areas of SDecial Competence !ndustrial Land rcommercial Land Besidential Land Endustrial Construction $ommercial Construction Besidential Construction Besidences fAoartments (1-4) TApartments (5-100) rcooperatives $ondominiums EL.ow Income Hous:ng EOffice s Dingle Tenant lndustrial E\/ulti-Tenant lndustrial fFhopping Centers f,Auto Service Centers Dpecial Purpose Properties Education Colleoe Deoree BA Kyung Hee University, Seoul Korea Aporaisal Courses and Seminars 2005 Fundamental of Real Estate Appraisals 2005 Legal Consideration 2005 USPAP Courses 2005 Math & Regulations for Appraisal 2006 USPAP Update 2007 lncome Approach 2007 Sales Approach 2007 Residential lncome 201 0 Capitalization Rate 2008 USPAP Update 2010 USPAP Update 201 1 Highest and Best Use 2012 2-4 unit multi-family dwelling 2012 Expert Witness 2012 FHAA/A Appraising 2012 Advanced Residential Applications & Case Studies License Certified General Real Estate Appraiser, License #AG035644, Expires 11l16/2016 Verification Call: OREA (916) 322-2500 15032000N, RCS vernon Properries 22 Subject Photographs 15032000N, RCS Ver:non Properties 23 33 61 Eruitland Ave, vernon 3365 Eruitland Ave, Vernon 15032000N. RCS Vernon Properties 24 Eruitland Ave, Street Scene 15032 000N, RCS vernon Properties 25 4 321 Eurlong P1ace, Vernon 4323 Euilong P1ace, Vernon .t5032000N, FCS vernon Properties 26 432 4 Furlong Place, Vernon 4325 Eurlong Place, Vernon 15032 000N, Rcs vernon Properties 2l 4328 Eurlong P1ace, Vernon Eurlong Place, Street Scene 15032000N, RCS Vernon Properties 28 Rental Photographs 15032 000N, RCS Vernon Properties 29 2923 LaDreL PI, South cate 4721 E 67"r St, Huntington Park 120 E 43'd PI, l,os Angeles 3677 louise St, Lynwood 15032000N, RCS Vernon Properties 30 24'7 E g)r}, St, Los Angeles 10715 Mona Blvd, Los Angefes 8106 Lou Di11on Ave, ],os Angeles 5130 Duncan Way, South Gate 15032 000N, RCS vernon Properties 31 ATTACHMENT 2 z z z z z z (D (,G o t- Eq 3SoF-OE rLg E @ SE e -o to9Eo o63E! 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