Item 5 - Award of Bid for Poway Royal MH Park Sewer Improvements Project
TO:
FROM:
INITIATED BY:
DATE:
SUBJECT:
AGENDA REPORT SUMMARY
Honorable Mayor and Members of the City Council
Honorable Chairman and Members of the Redevelopment Agency
James L. Bowersox, City Manager/Executive Dire~
Niall Fritz, Director of Development Services p?'
February 22, 2005
Award of Bid for the Poway Royal Estates Mobile Home Park Sewer
Improvements Project (#5955) - Bid No. 05-009
ABSTRACT
Bids were opened on January 25, 2005 for the Poway Royal Estates Mobile Home Park Sewer
Improvements Project, located on Estrella Vista Way and Dana Vista Way in the Poway Royal
Estates Mobile Home Park in the City of Poway, The contract time for this project is 25 working
days. The engineer's estimate for this project is $5,000 to $8,000.
- ENVIRONMENTAL REVIEW
This item is not subject to CEQA review.
FISCAL IMPACT
There are sufficient funds in the project budget (#5955D) for the award of this contract.
ADDITIONAL PUBLIC NOTIFICATION AND CORRESPONDENCE
Tri-Group Construction and Development Inc., 13943 Poway Road, Suite B, Poway, CA 92064.
RECOMMENDATION
It is recommended that the City Council/Redevelopment Agency award the Poway Royal Estates
Mobile Home Park Sewer Improvements Project (#5955) to Tri-Group Construction and Development
Inc., the lowest responsible bidder, in the amount of $17,950.00.
ACTION
.
-
:\CIP _Development\CIP Admin\Agenda Reports\2005 Reports\5955 Poway Royal Sewer Improvements\022205_Award Poway Royal_sum.doc
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February 22, 2005 Item # S
CITY OF POWAY
AGENDA REPORT
This report is included on the Consent Calendar. There will be no separate discussion of the report prior to approval by the City Council unless mem~
of the Council. staff or public request it to be removed from the Consent Calendar and discussed separately. If you wish to have this report pulled for
discussion, please fill out a stip indicating the report number and give it to the City Clerk prior to the beginning of the City Council meeting.
FROM:
Honorable Mayor and Members of the City Council
Honorable Chairman and Members of the RedEW:I~~ent Agency
James L. Bowersox, City Manager/Executive Dire~
Niall Fritz, Director of Develo~t services?
Javid Siminou, City Engineer.
J. Bradley Kutzner, Assistan ity Engineer,~
February 22, 2005
TO:
INITIATED BY:
DATE:
SUBJECT:
Award of Bid for the Poway Royal Estates Mobile Home Park
Sewer Improvements Project (#5955) - Bid No. 05-009
BACKGROUND
The Poway Royal Estates Mobile Home Park Sewer Improvements Project is located
on Estrella Vista Way and Dana Vista Way in the Poway Royal Estates Mobile Home
Park in the City of Poway. The contract time for this project is 25 working days. The
engineer's estimate for this project is $5,000 to $8,000.
FINDINGS
Bids were opened on January 25, 2005. The following two bids were received:
Name of Com an
Tri-Grou Construction
Khavari Construction, Inc.
Bid Pro osal Amount
$17,950.00
$27,777.00
Projects of this type (working in and around the back yards of mobile homes), are very
difficult to estimate. With these two bids, it is clear that the estimate was not in line with
current market conditions. Since this project addresses ongoing sewage spills (as
recent as late January 2005), staff feels it is appropriate to accept this bid and move
forward with the corrections, rather than delay the work to re-bid it. There is no
indication that a re-bid would provide a reduced cost.
20f3
February 22, 2005
Item # 5
Agenda Report
February 22, 2005
Page 2
ENVIRONMENTAL REVIEW
This item is not subject to CEQA review.
FISCAL IMPACT
There are sufficient funds in the project budget (#5955D) for the award of this contract.
ADDITIONAL PUBLIC NOTIFICATION AND CORRESPONDENCE
Tri-Group Construction and Development Inc., 13943 Poway Road, Suite B, Poway, CA
92064.
RECOMMENDATION
It is recommended that the City CounciVRedevelopment Agency award the Poway
Royal Estates Mobile Home Park Sewer Improvements Project (#5955) to Tri-Group
Construction and Development Inc., the lowest responsible bidder, in the amount of
$17,950.00.
JLB:NF:JS:JBK:vm
M:\CIP _Development\CIP Admin\Agenda Reports\2005 Reports\5955 Poway Royal Sewer Improvements\022205_Award Poway
Royal_Rpt.doc
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February 22, 2005 Item # 5
Mayor Cafagna, City Council ,~.....t...rs, ladies and gentlemen of city
government, my name is Sherry Wilks and I am a resident of Poway Royal
Mobile Estates.
In the May 2003 issue of HOUSING AND COMMUNITY DEVELOPMENT
NEWS City Manager, James Bowersox said that the City of poway
purchased three mobile home parks (in the late 1980's and early 1990's]
with the intention of stabilizing rents on affordable housing. He went on to
say "the council knew that keeping rents low would mean operating the
parks at a loss. The council made a conscious decision that it was more
important to preserve the housing opportunity for the people living there
than to contribute to the cost of maintenance and operation of the park. "
In 1999, Poway decided it was time to get out of the low-income housing
business. One step toward that goal was the sale of the Poinsettia Family
and Senior Mobile Home Park to Wakeland Housing in 2003. Although the
city sold the park for a fair market value of 14.5 million dollars, the sale was
not such a good deal for the city or the park residents. In order to make the
sale, in Mr. Bowersox's words, a "financial success" Poway gave Wakeland
a very nice interest rate for the first 5 years of the loan - zero percent. At
today's rate of 5.5%. that is almost 4 million dollars. poway also gave
Wakeland Housing a 4.8 mlUion dollar "second mortgage" from proceeds of
a 10 mlUion dollar, 20 year, and 5 percent bond. That is 10 million dollars in
interest that Poway has to pay. Really, we all know, that is a 10 million
dollar burden that will eventually find its way to the residents of the
Poinsettia (Family and Senior IIobile Home] Parks.
Ladies and gentlemen, we the residents of Poway Royal Mobile Estates
have submitted a proposal to the City of Poway to purchase our park. This
proposal does not ask the city to hold a 35-year mortgage. We are not
looking for interest-free loans. We do not need the city's help for this to be
a "financial success." This proposal is an all-cash deal. We believe it is
the only proposal that ensures housing costs for the existing residents will
indeed remain stable for as long as they continue to live in the park. If this
really is Poway's desire then there can be no option except to approve the
sale of poway Royal (lIobile Estates] to its residents.
Volume 13, Number 5
May 2003
Making Ends Meet
The cost of living in San Diego continues to grow
beyond the means of working families who help operate
our local economy. Unless we begin to consider new
strategies to fight the crisis of working poverty, the current
economic downturn will further exacerbate San Diego's
affordability crisis.
In previous studies, the Center on Policy Initiatives
(CPI) looked at the kinds of jobs our economy was
creating and whether those jobs and wages were ad-
equate to support working families. This new study of San
Diego looks at !he o!her side of a families' financial
Table of Contents
Making Ends Meet ......................................................1
Federation News .........................................................3
Brown Bag Lunch ................................................,...3
COC Failures, Downsizings and Mergers .................3
Around the County
Three New Acquisition-Rehab Developments ..........5
City Council to Review Homeless-Aid Policies ........6
Poway agrees to sell 2 mobile-home parks ............. 6
North County Apartment Rates up 2.8 Percent ....... 7
Around the State
HCD Releases CalHome Program Draft Regulations .... 8
Proposed Uniform Multifamily, MHp, HOME &
JSJFWHG Regulations .............................................8
Affordable Housing Exhibit ...................................... 9
U.S. Supreme Court Endorses Referendums ........... 9
HUD Releases FY 2003 SuperNOFA ........................ 9
The Community Development Trust and
Fannie Mae Announce $100 Million Investment .....10
Calendar of Events ....................................................11
.
situation - !he rising costs of basic needs !hat define a
decent standard of living in San Diego. The CPI looks at
the real cost of living for various family types and calcu-
lates !he wages that woIkers need to make in order to
support their families' basic needs.
By all accounts, the costs of basic family needs in San
Diego are rising rapidly and making it increasingly difficult
for working families to make ends meet. Rising costs of
housing and utilities have led to San Diego being the 8th
most expensive place to live in the nation. In San Diego
CODllty, a worker eamingminimmn wage ($6.75 per hour)
would have to work 125 hours per week in order to afford
the 2003 Fair Market Rent of $1,095 for a two-bedroom
apartment.
Determining a family's basic needs has sparked many
debates in the United States over the decades. The
"poverty line" is the most commonly used, but not univer-
sally accepted, measure !hat describes !he imaginary line
between families that are making ends meet and those
that are not.
The current measure of poverty in the United States
is the Census Bureau's Federal Poverty TItreshold, first
developed in 1963-64 by Molly Orshansky of !he Social
Security Administration. Using a 1955 survey that found
that households typically spent one-third of their budgets
on food, and using the Department of Agriculture's
Economy Food Plan, Orshansky calculated poverty
thresholds for various family sizes by taking the economy
food plan for a given family size and multiplying it by
three. The government has made no changes to this
fonnula since its inception, except for adjusting it based on
the average increase in consumer prices.
Poverty numbers from the 2000 Census shows that
approximately 9% of San Diegans live below the poverty
.continued on next page
AROUNDTHECOUNTV
Parlcside Apartments
...continued from previous page
Helping celebrate the day, again, was Councilmen1ber
Charles Lewis joined by the Housing Commission CEO
Betsy MOITis and other commission representatives. SoCal
Housing's John Seymour (director, San Diego Division) and
Rebecca Clark (executive director) were there, aloug with
La Quetta Bush-Simmons, executive director of Hope
Through Housing Foundation (HOPE). As the nonprofit
partner that will provide community service programs at
Parkside's new onsite community resource center, HOPE
will provide residents with after-school tutoring and career
development services, along with computer stations,
parenting and community organizing classes.
In addition to the Housing Commission, other funding
partners for Parkside Apartments included Related Capital
Company and California Community Reinvestment Corp.
City Council to Review Homeless-
Aid Policies
The San Diego City Council plans to review its policies
on shelter, housing and assistance for homeless people.
The city manager's staff will form a Homeless Advisory
Committee for the council and a Sitting Guidelines Task
Force to help the city draft new rules for agencies that
want to establish homeless services facilities. Forming the
committee and task force were among a list of recommen-
dations in a report by the Homeless Services Program Task
Force.
Also among the recommendations were expanding
housing options for low-income families and the physically
disabled. The task force said housing should not he consid-
ered affordable unless rent does not exceed 30 percent of
a household's income.
The Task Force's recommendations will be studied by
city staff, which will determine the cost. The recommenda-
tions will then be sent to the council for consideration.
Recognizing that many of the recommendations will require
additional money, the task force suggested pursuing local,
state and federal funds.
The task force was made up of representatives of
homeless services organizations, city police and city
administrators. The group was co-chaired by SistEr
RayMonda DuVall of Catholic Charities and John Thelen
of the Regional Task Force on the Homeless.
Poway agrees to sell 2 mobile-
home parks
Wakeland Housing will soon buy two of the three
mobile-home parks the City of Poway owns.
The Poway City Council voted 4-0, with Councilman
Don Higginson absent, to sell the Poinsettia Family Mobile
Home Park and Poinsettia Senior Mobile Home Park for
$14.6 million. The city bought the parks in 1988for$10
million.
City Manager Jim Bowersox called the vote a "mo-
mentous occasion," saying the council was taking a major
step toward a 4-year.old goal of selling three mobile-home
parks and one park of modular homes purchased in the late
19808 and early 19908.
The city bought the parks with the intention of stabiliz-
ing rents on affordable housing. The council knew that
keeping rents low would mean operating the par!'" at a
loss, Bowersox said 'The council made a conSCIOUS
decision that it was more important to preserve the housing
opportunity for people living there than to contribute to the
cost of maintenance and operation of the park," he said.
New tenants at the parks pay higher rent than existing
tenants, bringing increased rent income over time. The
council planned to keep the parks until the rent income
covered operating expenses and payments on the purchase
debt, Bowersox said That happened last fiscal year. The
two parts cost $884,790 to operate in fiscal year 2001-02,
and the annual debt payment was $954,410, while the
revenue from rents and utilities was nearly $1.8 million.
In 2000, the city sold Haley Ranch Estates, a commu-
nity of factory-built modular homes, to Community
HousingWorks, an Escondido-based nonprofit group. It
plans to sell Poway Royal Mobile Estates when its rent
income catches up with its costs in about 10 years.
Wakeland Housing is committed to purchasing the
Poinsettia parks, which have a total of 262 spaces, and
Irvine-based Newport Pacific will manage them. The deal
is expected to close about May 21.
Wakeland owns nine affordable-housing communities
throughout Southern California as well as in Santa Maria
and Seattle. Newport Pacific manages 55 mobile-home
communities in California, Arizona, Colorado, Nevada,
Texas, Idaho and Wyoming.
The purchase agreement for the Poinsettia parks
requires Wakeland to continue the existing rent structure,
maintain and improve the condition of the parks and involve
residents in the transition. Wakeland is paying the market
price, but to help assure the parks' financial success, it
worked out a financing plan with the city that gives it a
lower intErest rate and payments that don't start for three
years.
-
iJW.- rwf~~ ~.
February 22, 2005
To the members ofthe Poway City Council
I am asking for the opportuuity to purchase my little bit of heaven in the city of Po way, I would
prefer to be here in person but I am unable to since I am working,
I am a minority in this town, meaning that I am one of a handful of current residents that have
actually grown with this town. I have lived in Poway since the age of 3 when my parents moved
here in 1961. I went to Garden Rd School and graduated from Poway High, I worked for a
small business here in Poway for over 20 years, In 1980 I voted for Poway to become a "city in
the country," Due to other financial obligations and the price of owning a home in Poway, I
have never been in the position to purchase a "real" home in my own hometown, 11 years ago I
was able to purchase a manufactured home in the Poway Royal Mobile Estates. Now, all of you
are in a position to make it possible for me to purchase the land under my home. This would be
a dream come true". that I could own a "real" home (home + the land) in the city I grew up in,
in the city that has been my home for 45 years,
Without this opportunity I worry that as prices climb at an uneven rate with my salary I will no
longer be able to afford to live in Poway. If you grant us the opportuuity to purchase our land, I
will have the opportunity to stay with out the incredible increase of our rent.
Poway is my home. I love it. Please help me to own a little bit heaven in my city,
Thank you for your time,
Lori Rethoret
d~
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~-~~
.
General Meeting
February 16, 2005
The Solution is Simple
All the City of Poway needs to do is DEFER the bond sale and the plan to give the Park away to a
management company and let the Homeowners have the opportunity to purchase their own lot -
they already own their homes, Everyone wins!!
We have presented the City with a simple solution - Let's see how complicated the City of Poway is
going to make it!
Here's a quick look at what the City is trying to get away with:
Per Month/Per Space
Operating Expenses $ 1,491,261 $ 311,46
Replacement Reserves $ 39,900 $ 8,33
Total Expenses $ 1,531,161 $ 319.79
Debt Service
Series A Bond $ 1,592,411 $ 332.58
Series B Bond $ 415,412 $ 86,76
Series C Bond $ 841,967 $ 175,85
Total Debt Service $ 2,849,790 $ 595,19
Trustee Fees $ 3,500 $ 0,73
Rating Agency Fee $ 10,000 $ 2.09
Issuer Fees $ 25,000 $ 5,22
Resident Services Fees $ 37,080 $ 7,74
Asset Management Fees $ 37,080 $ 7,74
Total Fees $ 112,660 $ 23.53
Total Expenses $ 4,493,611 $ 938,52
Current Avg Rent $ 651,00
Debt per month ($287,52)
Yes, you read that correctly, $938.52 (when taxes are added $1001.52Ifor each of our spaces
every month! By the City's figures they must increase our rents or continue into
bankruptcy/insolvency. Bonds have a lot of added fees and expenses,. .euess who eets to pav them!
Debt Service Bond Totals 35 year Inerest Annual Payment Monthly Payme
Series A Bond $ 23,188,226.00 6% $ 1,592,411 $ 332,58
Series B Bond $ 5,400,432,00 7% $ 415,412 $ 86,76
Series C Bond $ 9,848,709,00 8% $ 841,967 $ 175,85
Total Debt Service $ 38,437,367.00 $ 2,849,790 $ 595.19
ALL RENTS will be renegotiated after Dec. 31st, 2007 eliminating the current rent structure
and the 3% to 5%% cap on rent increases. Don't be fooled, the third party management
company WILL NOT keep the rents at the current level. The real question is do we all want to
spend $1001.52 per month with no caps on increases or do we want to have a steady
mortgage of $655.60 including the Homeowners Fees.
The Citv is not interested in YOU!! The City needs to cover its mismanagement of this Park by
passing the debt to us and giving it away before we find out... The sounds of San Diego!!
The News Publication of Poway Royal Mobile Home Owner's Purchasing Committee
Ihusbands@powayroyal.com 858-513-7828/ Morrieitzkowitz @powayroyal.com
www.powayroyal.com
ijJ..~
Issue 9
February 21, 2005
History of Greed and Waste
Years ago homeowners wanted to buy Poway Royal for $15 million (with improvements to be made by the
sellers) and asked the City for financial help. The City bought the Park in the interest of the residents. The
City, in all its wisdom (?) paid $21 million for the Park with NO improvements from the sellers. Hold on. it
f!ets better! The City then floats an overvalued bond on the Park for $28.3 million with the intent of raising
rents 5% every year to make up for this outrageous waste of money and mismanagement. Then the
Homeowners sued the City for this negligence and abuse. After losing seven times, the City settled, made
improvements to the Park and had to change the rent structure. Those improvements should have been done
before the City bought the Park not after, at our expense
The City has lost money on this Park every year because it couldn't raise the rents, utility fees, and storage fees
fast enough to offset their over financing of our Park,
Here's the City of Po way's Game Plan:
1. Bring in Wakeland at $14.300.00 a month to manage the Park. Homeowners asked why so many layers
of fat? We don't care-we have a game plan.
2. We will do like we have done at Poinsettia Park and slip the ownership over to Wakeland -- nobody
will notice. We'll just keep lying to the homeowners that we would like to see them own the Park,
3. With our working partner, Wakeland purchasing the Park, we'll get a low income and affordable
housing designation and that helps us meet our state mandated housing requirements. That means we
can get more state funds. It keeps us working and spending more. We love it.
4. We'll get an appraiser to overvalue the Park, as before, and issue more bonds. We don't have to follow
the Appraisal lnstitutute's guidelines for determining values like everyone else - we're the City. This
time we'll go for $37.2 million, This way we can pocket $10 million and make up for our waste and
mismanagement. Who cares if the Homeowners have to continue to pay for our abuse?
5. This still isn't enough, we'll also take the $millions in reserve funds paid by the homeowners. Heck
they'll never know, people living in trailer parks aren't very bright any way.
6. Let's see now -- We are getting more state money, we are making a killing on the selling price. we are
taking the reserve accounts and with 399 units going toward our state mandates, we are heroes. We can
go back to our gated communities and relish in the idea of Social Engineering at its finest without it
affecting our own personal lives.
7. What's this!!! The homeowners figured out what it's going to cost them. How can we convince the
owners that paying $1001.52 per month and renting is affordable housing? We don't care if they can
own their property for $655.50 per month and will remain the same for the next thirty years. We know
what's best for these people. We have their interest at heart.
8. We're not worried, our buddy Wakeland, who has not a dime invested, will rescue us. They'll be
responsible for raising the rents and planting the flowers and the cutesy programs while the termites are
eating the buildings, sidewalks are lifting out of the ground, midnight towing is running wild and other
real problems go untouched.
9. But we at the city will go off into the sunset writing our pamphlets and brochures on how marvelous a
job we've done for the Homeowners of Poway Royal.
The News Publication of Poway Royal Mobile Home Owner's Purchasing Committee
Ihusbands@powayroyal.com 858-513-7828/ Morneitzkowitz @powayroyal.com
www.powayroyaI.com
Health and Safety
Hello, my name is Dallas Hayden and I am a resident of Po way Royal Estates. I am a
board member on ihe Homeowner's Association and 1 am also on the Poway Housing
Commission.
I am here tonight to discuss the numerous health and safety issues at Poway Royal. In
preparation for the sale of the park, the city commissioned an inspection of the Park and
in the inspection, several health and safety issues were missed.
Before 1 explain these issues, let me give you my qualifications. I have 20 years
experience in the construction industry. 1 am a certified Home Inspector and am certified
in Mold Survey and Sampling. 1 have worked on several construction class action
lawsuits. Now to the health and safety issues that 1 have documented at Poway Royal.
List Problems:
S-tr- fllTfJdlt-D P;:6E /lVf) p'c-'/tlLrS
Riff) /IJ j qLlf/1t (; L'-A//d.uS.
These are serious problems the residents must deal with on a daily basis. These problems
are due to the mismanagement by the City and Wakeland. While they are concentrating
on the aesthetics of the park, the resident's health and safety is being put at risk. There
are no complaints because the general public is not trained to notice the signs associated
with this problem. The residents trust those who are in charge and here is a case where
those that are in charge are not fulfilling there obligations. Here is another reason why
selling to a third party would be detrimental to the residents. A non-profit organization
will concentrate on programs for the residents. But when these programs are held in
buildings with environmental hazards are they really benefiting the children and seniors?
Or instead by ignoring these hazards are the residents being put in hann's way? The only
way to get rid of these problems will be to hire professional companies. And the only
way to guarantee that the resident's health and safety will be guaranteed is if you let the
residents purchase the park
Thank you.
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