Item I4
LAND AUTHORITY GOVERNING BOARD
AGENDA ITEM SUMMARY
Meeting Date: November 18. 2009
Division: Land Authoritv
Bulk Item: Yes No...x..
Contact / Phone #: Mark Rosch / 295-5180
Agenda Item Wording: Approval of a resolution authorizing amendments to the affordable housing
deed restrictions for Habitat Landing on Big Pine Key.
Item Background: Habitat Landing is a 15-unit homeownership affordable housing development
located on bayside of Big Pine Key on Avenue B. In 2001 the Land Authority purchased the site,
imposed deed restrictions, and transferred title to Habitat for Humanity of Key West and Lower Florida
Keys, Inc. (HFH). In 2004 HFH completed construction, imposed additional deed restrictions, and
began selling the 15 houses.
HFH plans to convert the Habitat Landing development to the land trust model of affordable housing.
To do this HFH will exercise its right of first refusal and gradually buy back each house in the
development. The properties subsequently resold by HFH will be encumbered with ground leases
rather than silent mortgages.
HFH proposes to amend the Land Authority deed restrictions to establish a resale formula based on an
annual increase of 1.5% per year instead of the existing formula based on 25% of the appreciated
value. The amendments would also clarify that the resale price will not be adjusted for improvements,
additions or maintenance and will not be based on any forgiven or released silent mortgages. In
addition to these changes, the Land Authority Advisory Committee recommends extending the term of
the deed restrictions from 50 years to perpetuity and specifying that HFH's initial sales price shall not
exceed 90% of the sales price of current comparable new HFH homes.
Advisory Committee Action: On October 27, 2009 the Committee voted 5/0 to approve this
resolution.
Previous Governing Board Action: The Board approved purchasing the property in 2000 and
conveying the property to H FH with deed restrictions in 2001.
Contract/Agreement Changes: Described above.
Staff Recommendation: Approval.
Total Cost: $ 750.00
Indirect Cost: $
Budgeted: Yes ~ No
Cost to Land Authority: $ 750.00
Source of Funds: Land Authoritv
(Tourist Impact Tax and State Park Surcharge)
Approved By: Attorney ~ County Land Steward _'
Documentation: Included: ~
To Follow:
Not Required:
Disposition:
Agenda Item
RESOLUTION NO.
A RESOLUTION OF THE MONROE COUNTY
COMPREHENSIVE PLAN LAND AUTHORITY AUTHORIZING
AMENDMENTS TO THE AFFORDABLE HOUSING DEED
RESTRICTIONS FOR HABITAT LANDING.
WHEREAS, section 380.0666(3), Florida Statutes and section 2-396, Monroe County Code
empower the Monroe County Comprehensive Plan Land Authority (hereinafter "Land Authority")
to acquire and dispose of interests in real property in order to provide affordable housing; and
WH EREAS, the Land Authority acquired Block 1, Lots 1-15, Palm Villa subdivision (PB 1-89) as
an affordable housing site (hereinafter "subject property"); and
WHEREAS, the Land Authority conveyed the subject property via deed recorded in Official
Records Book 1690, Page 379 to Habitat for Humanity of Key West and Lower Florida Keys,
Inc. (hereinafter HFH) for development with affordable housing known as Habitat Landing; and
WHEREAS, HFH requests the Land Authority to amend the affordable housing deed restrictions
in said deed; and
WHEREAS, the Land Authority Advisory Committee considered this resolution at a meeting held
on October 27,2009 and voted 5/0 to recommend approval; NOW, THEREFORE,
BE IT RESOLVED BY THE MONROE COUNTY COMPREHENSIVE PLAN LAND AUTHORITY:
Section 1. The Chairman of the Land Authority Governing Board is hereby authorized to sign
legal documents necessary to amend the affordable housing deed restrictions in the deed
recorded in Official Records Book 1690, Pages 379-81 in accordance with the revisions shown
in Attachment A.
Section 2. The amendments contained in Attachment A shall be applicable only to those
properties in Habitat Landing that HFH has acquired or will acquire in the future, and shall be
recorded contemporaneously with a deed to HFH; provided that until such acquisition by HFH
occurs, the existing affordable housing deed restrictions shall remain in place.
PASSED AND ADOPTED by the Monroe County Comprehensive Plan Land Authority at a
regular meeting on this day of 2009.
(Seal)
ATTEST:
MONROE COUNTY COMPREHENSIVE
PLAN LAND AUTHORITY
Mark J. Rosch
Executive Director
Kim Wigington
Chairman
Approved as to Legal Form
Larry R. Erskine
ATTACHMENT A
AM EN OED AFFORDABI L1TY COVENANTS
1. Affordability Period. These affordability requirements shall run with the property for a period
of fifty (50) years. These affordability covenants are perpetual. run with the land in favor of
the Monroe County Comprehensive Plan Land Authority, and are bindinQ on all present and
subsequent owners and mortQaQees.
2. Income Limits, Use and Transfer Restrictions. Habitat for Humanity of Key West and the
Lower Florida Keys, Inc. (hereinafter HFH) shall develop the subject property and make
same available as ownership housing in accordance with the conditions specified below.
3. Use and Occupancy. The subject property shall be owner occupied and used as the
homeowner's primary residence and such other uses incidental to residential use as may be
permitted by local zoning and land use regulations.
4. Income Qualified Buyers. Ownership shall be restricted to households earning less than or
equal to 100% of the Monroe County median income adjusted for household size at the time
of conveyance.
5. Affordability. Monthly housing costs, defined as principal, interest, taxes, insurance (PITI),
and homeowner association fees [if any] shall not exceed the annual adjusted gross
household income multiplied by 0.30 and divided by 12, all in accordance with s420.0004,
Florida Statutes.
6. Initial Sales Price Limits. In the event HFH acquires title to a parcel of real property located
in Habitat LandinQ, the sales price shall not exceed 90% of the sales price of current
comparable new HFH homes. If no comparable new homes have been sold by HFH in the
prior 18 months, then the resale price shall not exceed 90% of the most recent comparable
new HFH home plus 1.5% for each complete year followinQ the most recent sale.
7. Resale Price Limits. The property and the improvements located thereon may be
transferred, subject to the provisions of Paragraphs '1 and 5 above, provided the transfer
price does not exceed the sum of the price the current O'A'ner paid plus 25% of the amount
by 'A'hich the unrestricted market value of the property may have appreciated during the
current owner's period of o'Nnership. The sales price for subsequent sales of homes shall
not exceed the sum of the sales price the current owner paid plus one and one half percent
(1.5%) simple interest (not compounded) per full calendar year of the current owner's period
of ownership. No adiustment to the "price the current owner paid" shall be made for
improvements, additions, or maintenance of the property. For the purposes of this resale
provision, the "price the current owner paid" shall not be deemed to include for the
calculation of a permitted resale price the amount of any forQiven or released "silent" or
other such mortQaQe devices used by HFH in the past. reQardless of required state
documentary stamp or intanQible tax obliQations on the resale of a unit. All transfers are
contingent upon HFH maintaining the right of first refusal to either purchase the property or
provide the Seller a qualified Buyer.
8. RefinancinQ Limits. The property may not be encumbered for any purpose without the prior
approval of MCLA, except for encumbrances for projects resulting in capital improvements
to the property and encumbrances imposing additional affordability covenants.
9. Affordability MonitorinQ. HFH will be responsible for ensuring these affordability
requirements are maintained. Whenever the property is transferred HFH shall provide
certification to the MCLA documenting these affordability requirements have been met.
MEMORANDUM
TO: Land Authority Governing Board
FROM: Mark J. Rosch, Executive Director
DA TE: November 3, 2009
SUBJECT: Request by Habitat for Humanity to Amend the Affordable Housing Deed
Restrictions for Habitat Landing
Summary
Habitat for Humanity of Key West and Lower Florida Keys, Inc. (HFH) proposes to amend the
Land Authority deed restrictions for Habitat Landing to establish a resale formula based on an
annual increase of 1.5% per year instead of the existing formula based on 25% of the
appreciated value. In addition to this change, the Land Authority Advisory Committee
recommends extending the term of the deed restrictions from 50 years to perpetuity and
specifying that HFH's initial sales price to a homebuyer shall not exceed 90% of the sales price
of current comparable new HFH homes.
Backaround
The Habitat Landing affordable housing development consists of 15 single-family homes located
on the bayside of Big Pine Key on Avenue B, Wilhelmina Way, Merelyn Way, and Pine Way.
The site was formerly developed with the Halcyon Trailer Park, which Hurricane Georges
partially destroyed in 1998. In 2001 the Land Authority purchased the site, imposed deed
restrictions, and transferred title to HFH. In 2004 HFH completed construction, imposed
additional deed restrictions, and began selling the 15 houses. The development includes a
wastewater treatment plant and wetland mitigation area owned and maintained by the Habitat
Landing Homeowners Association Inc.
The financing package HFH used to sell the houses consisted of a $500 down payment from
the buyer and either a $119,500 mortgage in favor of HFH or a $94,500 first mortgage in favor
of HFH and a $25,000 second SHIP mortgage in favor of Monroe County. As an additional
measure to preserve unearned equity and long-term affordability, each financing package also
included a $100,000 "silent" no interest balloon mortgage in favor of HFH.
The use of silent mortgages created some confusion over the original sales prices of the
houses. The documentary stamp tax paid on the deeds corresponds to a sales price of
$120,000, while the sum of the down payment and mortgages yields a sales price of $220,000.
HFH interprets the sales prices to be $220,000.
Existina Affordable Housina Restrictions
For a period of 50 years, the Land Authority's deed restrictions require that each lot be owner
occupied by households earning 100% or less of the Monroe County median income. Housing
costs are limited to 30% or less of annual adjusted gross household income. Each lot may be
sold to an income-qualified buyer, provided the new sales price does not exceed the price the
1
seller paid plus 25% of the amount by which the unrestricted market value of the property may
have appreciated during the seller's period of ownership.
In addition to the above restrictions running in favor of the Land Authority, HFH imposed its own
affordable housing restrictions establishing a right of first refusal and limiting the resale price to
25.5 times the Monroe County monthly median income for a family of four at the time of sale.
There are no resale restrictions imposed by the Monroe County Land Development Regulations
because, as the redevelopment of a mobile home park, Habitat Landing did not require
affordable housing ROGO allocations or density bonuses and therefore was not permitted via
the affordable housing provisions of the code.
Resale Activitv to Date
Since the initial sales, three of the 15 houses have resold as indicated below:
30449 Pine Way - HFH purchased this property in 2007 for $219,500 and resold it in 2008
subject to a ground lease for $160,000.
1404 Merelyn Lane - HFH purchased this property in 2007 for $218,500 and resold it in 2008
subject to a ground lease for $160,000.
30450 Wilhelmina Way - HFH purchased this property in 2008 for $110,000 and has not
resold any interest to date.
The above transactions occurred without benefit of an appraisal and therefore compliance with
the Land Authority's "25% of the appreciated value" resale formula was not documented.
However, assuming initial prices of $220,000, each of the subsequent transactions have used
progressively lower prices and therefore, in accordance with the 5-year residency requirement
of the mortgages held by HFH, it appears none of the sellers received proceeds from an
appreciation in value.
With respect to compliance with HFH's "25.5 x median income" restriction, both the buy-back
and subsequent resale prices exceeded this limit. The $219,500 and $218,500 buy-back prices
for the Pine Way and Merelyn Lane properties exceeded this limit by $93,275 and $92,275
respectively. 1 The $160,000 resale prices for the Pine Way and Merelyn Lane properties
exceeded the limit by $21,450.2 Additionally, the deeds from HFH for the Pine Way and
Merelyn Lane properties fail to reference the Land Authority's restrictions for Habitat Landing
but instead reference the Land Authority's restrictions for 27250 Brown Drive on Ramrod Key.
Proposed Chanaes to Affordable Housina Restrictions
HFH plans to convert the Habitat Landing development to the land trust model of affordable
housing. To do this HFH will exercise its right of first refusal and gradually buy back each house
1 The 2007 Monroe County median income for family of four was $59,400. Multiplying the corresponding
monthly income ($4,950.00) times 25.5 yields a 2007 resale limit of $126,225.
2 The 2008 Monroe County median income for family of four was $65,200. Multiplying the corresponding
monthly income ($5,433.33) times 25.5 yields a 2008 resale limit of $138,550.
2
in the development. The properties subsequently resold by HFH will be encumbered with
ground leases rather than silent mortgages.
HFH proposes to amend the deed restrictions by replacing both of the existing resale limits with
a single new limit consisting of the price the owner paid plus 1.5% simple interest (not
compounded) per full calendar year of the owner's period of ownership. The amendments
would also clarify that the resale price will not be adjusted for improvements, additions or
maintenance and will not be based on any forgiven or released silent mortgages.
In addition to the amendments proposed by HFH, the Land Authority Advisory Committee
proposes to extend the term of the deed restrictions from 50 years to perpetuity and to specify
that HFH's initial sales price to a homebuyer shall not exceed 90% of the sales price of current
comparable new HFH homes.
3
Aerial Photograph of Subject Property
Habitat Landing
Big Pine Key
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MONRO!!: COUNTY
OFF'rCIAL RRCORDS
. This I~strument Prepared By,
Record and Return to:
MEYER & ERSKINE, PA
31211 AVENUE A
BIG PINE KEY, FL 33043
Agent File No.: 00417
Parcel Identification Number: 00277240
ReD Ape
DANNY L
0B64
PGj! 3 7 B
I
20 2001
KOLHAGE,
I
DEED DOC S!A~ 0.70
04/20/2001 ~EP eLK
'3"5P'~
CLERK ~
FILE j!1..23
BK#J. 690
SP ACE ABOVE THIS LINE FOR RECORDING DATA
WARRANTY DEED
i!-J-
THIS INDENTURE, made this \7 day of Api'll 2001, between MONROE COUNTY
COMPREHENSIVE PLAN LAND AUTHORITY, a land authority under Section 380.0663(1) Florida Statutes
and Monroe County Ordinance Number 031-1986* GRANTOR, whose address is1200 TRUMAN A VENUE,
SUITE 207, KEY WEST, FL 330433, and HABITAT FOR HUMANITY OF KEY WEST AND LOWER
FLORIDA KEYS, INC., a Florida corporation, not for profit, whose address is P.O. Box 421003, Summerland
Key, Florida 33042, GRANTEE*;
(Wherever used herein the terms "Grantor" and "Grantee" shall include all the parties to this instrument and heirs,
legal representatives, and assigns of individuals, and the successors and assigns of corporations.)
WITNESSETH, That said Grantor, for and in consideration of the sum of TEN AND 00/100 ($10.00)
DOLLARS and other good and valuable consideration, to said Grantor in hand paid by said Grantee, the receipt
whereofis hereby acknowledged, hereby grants, bargains, sells, aliens, remises, releases, conveys and confirms unto
the Grantee and Grantee's heirs, successors and assigns forever the following described land located in the County
of MONROE, State of Florida, to-wit:
All of Block 1, PALM VILLA, according to the plat thereof as recorded in Plat Book 1, Page
89 of the Public Records of Monroe County, Florida.
SUBJECT TO: Restrictions as contained in Monroe County Comprehensive Plan Land
Authority Resolution Number 02-2001 attached hereto and made a part hereof as
Exhibit "A".
SUBJECT TO all conditions, Restrictions, Easements and limitations of record, if any.
TOGETHER WITH all the tenements, hereditaments and appurtenances thereto belonging or in anywise
appertaining.
To HA VE AND TO HOLD, the same in fee simple forever.
AND THE SAID GRANTOR does hereby covenant with the said Grantee that the Grantor is lawfully seized
of said land in fee simple; that the Grantor has good right and lawful authority to sell and convey said land, and hereby
fully warrants the title to said land and will defend the same against the lawful claims of all persons whomsoever.
IN WITNESS WHEREOF, Grantor has hereunto set Grantor's hand and seal this day and year first above
written.
. the presence of:
Witness Signature
L.tJlL~ ,1(- ~ptJ4
Printed Signature
G c-.)
Q.,-^-,,- 'M, ~
Witness Sigpature . I C:~P
';::>u'" ~'-'I. ,">CI. f' _
Printed Signature
MONROE COUNTY COMPREHENSIVE
PLAN LAND AUTHORITY
"-
BYl/t.~~
NO ILLIAMS, CHAIRMAN
STATE OF FLORIDA
COUNTY OF MONROE
;t{.\
I HEREBY CERTIFY that on this II day of Ae N \ 2001, before me, an officer duly qualified to take
acknowledgments, personally appeared NORA WILLIAMS, CHAIRMAN , tome known to be the person
described in and who executed the foregoing instrument and acknowledged before me that it executed the same.
Driver's License shown as identification or personally known.
SEAL
<6~m ' S "" ~
Notary Signature
Printed N' ~UE M. SAPP
MY COMMISSION # CC 808077
~ ."",_ EXPIRES: February 10, 2003
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E X H I BIT ItAIt
RESOLUTION NO. 02-2001
A RESOLUTION OF THE MONROE COUNTY
COMPREHENSIVE PLAN LAND AUTHORITY AUTHORIZING
THE CONVEYANCE OF PROPERTY IN PALM VILLA
SUBDIVISION TO HABITAT FOR HUMANITY OF KEY WEST
AND LOWER FLORIDA KEYS, INC. FOR THE PURPOSE OF
PROVIDING AFFORDABLE HOUSING.
FILE #1 2 3 0 864
BK#1690 PG#379
WHEREAS, section 380.0666(3), Florida Statutes (FS) and section 9.3-2, Monroe County Code,
empower the Monroe County Comprehensive Plan Land Authority (hereinafter "Land Authority")
to acquire an interest in real property for the purpose of providing affordable housing to very low,
low, and moderate income persons as defined in section 420.0004, FS, where said acquisitions
are consistent with a comprehensive plan adopted pursuant to Chapter 380, FS; and
WHEREAS, Habitat for Humanity of Key West and Lower Florida Keys, Inc. (hereinafter HFH) is
a not-for-profit Florida corporation and an approved affiliate of Habitat International and is
organized to provide safe, decent, and affordable housing to people in need within the Lower
Keys and Key West; and
WHEREAS, the Land Authority has entered into a contract to purchase Block 1, Lots 1-15, Palm
Villa subdivision (PB 1-89), formerly the site of the Halcyon Trailer Park, as an affordable
housing site in partnership with HFH; and
WHEREAS, HFH requests that the Land Authority convey the subject property to HFH and allow
HFH to develop the property with affordable housing; and
WHEREAS, the Land Authority Advisory Committee considered this resolution at a meeting held
on February 26,2001 and voted 5/0 to recommend approval; NOW, THEREFORE,
BE IT RESOLVED BY THE MONROE COUNTY COMPREHENSIVE PLAN LAND AUTHORITY:
Section 1. The Chairman of the Land Authority Governing Board is hereby authorized to sign a
deed conveying the subject property consisting of Block 1, Lots 1-15, Palm Villa subdivision (PB
1-89) to Habitat for Humanity of Key West and the Lower Florida Keys, Inc.
Section 2. Future use of the subject property is limited to 15 single-family residential units for
occupancy by very low, low, or moderate income persons as defined in section 420.0004,
Florida Statutes, for a period of fifty (50) years, and as further restricted by Monroe County
afford ability regulations and Attachment A.
Section 3. The conveyance described in Section 1 above shall not include the rights to the
property's 25 transferable ROGO exemptions in Monroe County Development Order #1-01 nor
the property's nutrient credits. Said rights shall be retained by the Land Authority.
Page 1 of 2
FTLE #1 2 3 0 8 64
BK#l,.69CZ1 PG#3B0
<'>:P-~!i.'ED.,.." A,ND ADOPTED by the Monroe County Comprehensive Plan
i' ~ ........ eeting on this 22nd day of March 2001.
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Marl< J. ROS~
Executive Director
Land Authority at a
MONROE COUNTY COMPREHENSIVE
PLAN LAND AUTHORITY
..
'j(N-~
Nora Williams
Chairman
Approved for Legal Sufficiency
Larry R. Erskine
Page 2 of 2
. .
.... ...
FTLR #1 2 3 0 864
BR # 1. 6 9 0 PG# 3 8 1
ATTACHMENT A
AFFORDABllITY COVENANTS
1. Affordability Period. These affordability requirements shall run with the property for a period
of fifty (50) years.
2. Income Limits, Use and Transfer Restrictions. Habitat for Humanity of Key West and the
Lower Florida Keys, Inc. (hereinafter HFH) shall develop the subject property and make
same available as ownership housing in accordance with the conditions specified below.
3. Use and Occupancy. The subject property shall be owner occupied and used as the
homeowner's primary residence and such other uses incidental to residential use as may be
permitted by local zoning and land use regulations.
4. Income Qualified Buyers. Ownership shall be restricted to households earning less than or
equal to 100% of the Monroe County median income adjusted for household size at the time
of conveyance.
5. Affordability. Monthly housing costs, defined as principal, interest, taxes, insurance (PITI),
and homeowner association fees [if any] shall not exceed the annual adjusted gross
household income multiplied by 0.30 and divided by 12, all in accordance with ~420.0004,
Florida Statutes.
6. Resale Limits. The property and the improvements located thereon may be transferred,
subject to the provisions of Paragraphs 4 and 5 above, provided the transfer price does not
exceed the sum of the price the current owner paid plus 25% of the amount by which the
unrestricted market value of the property may have appreciated during the current owner's
period of ownership. All transfers are contingent upon HFH maintaining the right of first
refusal to either purchase the property or provide the Seller a qualified Buyer.
7. Refinancing Limits. The property may not be encumbered for any purpose without the prior
approval of the Monroe County Comprehensive Plan Land Authority (hereinafter MCLA),
except for encumbrances for projects resulting in capital improvements to the property and
encumbrances imposing additional affordability covenants.
8. Affordability Monitoring. HFH will be responsible for ensuring these affordability requirements
are maintained. Whenever the property is transferred HFH shall provide certification to the
MCLA documenting these affordability requirements have been met.
MONROE COUNTY
OFFICIAL RECORDS