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September 18, 2018 Mayor Pulido and City Councilmembers City of Santa Ana 20 Civic Center Plaza P.O. Bo 1988, M31 Santa Ana, CA 92701 RE: Consolidated Annual Performance and Evaluation Report Support Development of a Tenant Based Rental Assistance Program The need for housing affordable to low-wage earners in Orange County, California, is enormous. Ranked among the top ten least affordable metropolitan areas in the country111, Orange County is suffering from an affordable housing crisis. A resident must earn at least $36.08 per hour to afford a two-bedroom apartment at a fair market rent of $1,876 a month.lal As rents and the number of residents needing affordable homes have continually increased, the number of affordable homes being built for lower income households has not kept up with the demand. The average asking rents is the City is $1,687, which is a nine percent increase from the year before and rents are expected to continue to increase.i31 With lower wages that are not keeping up with rising rents, many renting families continue to struggle financially to live and work in this City. Approximately 60 percent of renter households are lower incomel41 and 84 percent of residents held moderate and low-income occupations that paid less than $53,500 per year.151 In order for rent to be affordable, only 30 percent of an individual's income should be used towards housing costs. Unfortunately, 57 percent of renters overpaid or spent more than 30 percent of their income towards housing costs.1e1 I'1 Out of Reach 2018- The High Cost of Housing, National Low Income Housing Coalition, p. 14, 2018. tzt Out of Reach 2018- The High Cost of Housing, National Low Income Housing Coalition, p. 38, 2018. 131 O.C. Rents forecast to rise 9.4% by 2018. (4) City of Santa Ana General Plan Housing Element 2014-2021, p. 14, January 2014. t51 City of Santa Ana General Plan Housing Element 2014-2021, p. 12, January 2014. 161 City of Santa Ana General Plan Housing Element 2014-2021, p. 20, January 2014. It is necessary that the City create a Tenant -Based Rental Assistance program to assist Santa Ana's rent burdened residents. A HOME Investment Partnerships Program funded Tenant -Based Rental Assistance program would provide a rental subsidy to help make up the difference between what a renter can afford to pay and the actual rent for a home. For the 2017 - 2018 fiscal year the City of Santa Ana received $1,207,942 in HOME funds. For this 2018 - 2019 fiscal year the City has received $1,783,000 in HOME funds. The City has the ability to use these funds to provide direct assistance to low-income households who need help paying