25J - AGMT ARTS COLLECTIVE GRANT

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C. Four percent (4%) of the gross Tax Credit proceeds for one year. KMA estimates the total financing costs at $1.78 million, which are reasonable and necessary to complete the Project. Tota/ Development Costs As shown in Table 1, KMA estimates the total development costs at $35.90 million, which equates to approximately $618,900 per unit. In comparison, the Developer estimates the total development costs at $35.85 million, or $618,000 per unit. This equates to a less than 1% differential, which can be considered inconsequential. As such, KMA finds the Developer's cost estimates to be reasonable and necessary to construct, lease -up, and complete the Project. As the Project moves through the development process, the City needs to keep track of the changes to the costs, if any. B. Stabilized Net Operating Income (Table 2) The Project's funding sources include City Inclusionary Housing funds, HOME Program funds, CDBG funds, AHSC funds, and 9% Tax Credits. The Project's income and affordability standards must comport with the most stringent of the following standards: 1. Income Restrictions: The tenants' household incomes cannot exceed the strictest of: a. HOME Program income restrictions as defined under United States Code, Title 26, Section 142(d)(2)(B). b. Federal Low Income Housing Tax Credits income restrictions defined under United States Code, Title 26, Section 142(d)(2)(B). 2. Affordability Restrictions: Rents applied to all of the units must reflect the most stringent of: a. HOME Program rents published annually by HUD; and Tax Credit rents published annually by the California Tax Credit Allocation Committee (TCAC). The HOME affordability requirements will remain in place for 20 years, which is the minimum period that the HOME Program requires. City of Santa Ana HOME Subsidy Layering Review: Santa Ana Arts Collective Page 17 25J-29