Submitted By: James Haynes
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Presentation By: James Haynes
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Department: Community Development Services
STAFF RECOMMENDATION (Motion Ready):
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Approve award of development opportunity and an Affordable Housing Agreement with D & S Development, LLC to construct and sell an affordable housing unit on surplus property (parcel ID 25686-001-00) located in West Ocala
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OCALA’S RELEVANT STRATEGIC GOALS:
Quality of Place, Economic Hub
PROOF OF PUBLICATION:
RFP released to the public 12/4/2023; Selection Committee Meeting 3/13/24; Presentations 7/3/23; and Intent to Award 7/18/2023
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BACKGROUND:
In April 2023, at its annual strategic planning session, Ocala’s City Council established addressing the affordable housing shortage as one of its major strategic initiatives. In response to this initiative, City staff formed an Affordable Housing Initiative Team to develop ideas and implement strategies to engage for-profit and not-for-profit developers in developing single-family and multi-family affordable housing projects. The initial “surplus lots” list was established, and an infill strategy was initiated to build single-family structures on scattered lot sites.
By and through Resolution 2023-40, adopted by City Council on September 19, 2023, the City currently holds an inventory of vacant lots located throughout the city for which it intends to offer for sale to qualified for-profit and non-profit developers, builders, partnerships, and/or agencies for the purposes of developing and constructing new affordable housing units.
FINDINGS AND CONCLUSIONS:
• On December 5, 2023, the City’s Procurement Department issued Invitation to Negotiate (ITN) #GRM/240224. The solicitation invited the submission of proposals from qualified residential builders to purchase parcel number 25686-001-00 and construct an affordable housing unit.
• The ITN closed on February 5, 2024. One proposal was received from D&S Development, LLC. of Ocala, FL (D&S).
• On or about February 29, 2024, the proposal from D&S was deemed responsive by the City’s Procurement Department.
• The Selection Committee met on or about March 13, 2024, to review the proposal. During the review, it was determined that the submitted proposal would only fit one of the four parcels bid on by D&S. The Committee instructed the buyer to have the developer resubmit proposals that would fit each of the four parcels, provide an updated letter from their mortgage company detailing the amount to be loaned for the project, clarify missing construction costs in their proposal, and provide an improved façade design for the project.
• On or about June 6, 2024, the City’s Procurement Department received the resubmittal of the proposal from D&S.
• On or about July 3, 2024, the Selection Committee met with D&S. The developer made a 15-minute presentation and afterward fielded questions from the Committee concerning the project.
• On or about July 17, 2024, the Committee was informed that the project was scored for approval and that the developer would be contacted to begin negotiations.
• D & S will construct the “Hummingbird Model” on parcel 25686-001-00. The model will have a total size of 1,296 square feet, with 1,152 square feet designated as livable area. The unit will feature 3 bedrooms and 2 bathrooms.
• The City will provide D & S with a City Incentive of $5,422 in the form of a property donation. This amount represents the fair market value of the property ($8,750) less the monetary portion of the purchase price ($3,328).
• The attached agreement outlines the requirements and deadlines for both D & S and the City, as well as the City’s right of reverter.
Staff recommends the approval of the development agreement and the sale of parcel 25686-001-00 to D&S for the assessed value of $3,328 for the construction of an affordable housing unit for a family unit whose annual household income does not exceed 120 percent of the Marion County Area Median Income (AMI).
FISCAL IMPACT:
The $3,328 generated from the property sale will be added to the Affordable Housing Incentive account (112-345-000-000-02-34105) to support future affordable housing initiatives. This property will also be added back to the tax roll and connected to City electric, water, and sewer services.
PROCUREMENT REVIEW:
These services were procured in compliance with the City’s Procurement Policy.
LEGAL REVIEW:
This Agreement will be reviewed and approved for form and legality by City Attorney, William E. Sexton.
ALTERNATIVE:
• Approve with Changes
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• Deny