Laserfiche WebLink
Judson Brown, City of Santa Ana <br />February 21, 2019 <br />Budget Inn: Preliminary Financial Gap Analysis Page 13 <br />2. However, KMA does not recommend that the City approve the social services <br />budget as proposed. Instead, KMA recommends the following structure: <br />The permanent loan may be underwritten based on the Developer's <br />proposed social services budget of $3,500 per affordable unit, or <br />$311,500 per year. <br />b. The Developer will be entitled to expend $2,000 per affordable unit, or <br />$178,000 without a requirement to receive City approval for the <br />expenditures. <br />C. Any proposed additional social services expenditures, up to a maximum <br />of $133,500 ($311,500 - $178,000 = $133,500), must be submitted to the <br />City for review and approval each year. <br />3. Typically, soft lenders of affordable housing projects will split 50% of a project's <br />residual receipts based on a pro rata distribution determined by their respective <br />loan balances. However, based on discussions with the Developer, it is likely that <br />OCCF will request 75% of the Project's residual receipts, which is much higher <br />than OCCF's pro rata share. As such, KMA recommends that the City work with <br />the Developer to negotiate a more equitable residual receipts distribution <br />among the soft lenders. <br />4. The City should require the Developer to obtain three general contractor bids <br />prior to selecting a general contractor. The three bids should be provided to the <br />City for review and approval. <br />1902016.SA.TRB <br />80B-31 19090.017.009 <br />