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Affordable Housing Project at 1108 N. Harbor Blvd. <br />April 20, 2021 <br />Page 3 <br />6 <br />4 <br />2 <br />Regarding the two Subordination Agreements with Union Bank and Jamboree Housing, <br />the City’s total loan for this project is $1,687,047 compared to Union Bank’s loan of <br />$890,000 and Jamboree Housing’s loan from Home Depot of $500,000. The City’s loan <br />is larger than the two loans from Union Bank and Home Depot and therefore we need <br />Union Bank and Jamboree Housing to subordinate their loans to our larger City loan. The <br />two Subordination Agreements will be drafted and finalized prior to executing and <br />recording the City’s loan agreement. However, the State of California Department of <br />Housing and Community Development (HCD) requires the City to subordinate our smaller <br />loan to HCD’s larger Veterans Housing and Homelessness Prevention program loan. The <br />Subordination Agreement with HCD will be executed at the time of permanent loan <br />conversion after the project is complete. <br />If the loan agreement is not approved by City Council, the City will be held liable under <br />our enforceable funding commitment that the City issued and extended in our pre-loan <br />commitment letter. <br />Project Description <br />The North Harbor Village project is a motel rehabilitation project that will provide eighty- <br />nine units of permanent supportive housing for homeless individuals in the City of Santa <br />Ana. This will be the City’s third motel conversion project in the last five years for people <br />experiencing homelessness following the development of the Orchard and Casa <br />Querencia. The Orchard project converted the former Guest House motel into 72 units <br />of permanent supportive housing and the Casa Querencia project converted the former <br />Aqua Motel. Similar to the conversion of this motel, the the Guest House and Aqua Motel <br />were high-crime, short-term use motels prior to their conversion into permanent <br />supportive housing with wrap-around supportive services. <br />Fifty-one of the units at North Harbor Village will be designated for chronically homeless <br />individuals and thirty-eight units will be designated for homeless veterans. There will be <br />a local preference for residents of Santa Ana who live or work in the City. The unit mix <br />and rent restrictions are as follows: <br />Unit Size No. Units AMI <br />Studio 89 30% <br />ENVIRONMENTAL IMPACT <br />There is no environmental impact associated with this action. <br />FISCAL IMPACT <br />Funds for the loan agreement in the amount of $1,518,342.30 (90% of the total) are <br />available in the Community Development Block Grant, Loans and Grants account (no. <br />13518782-69152) for expenditure in the current fiscal year. The remaining $168,704.70 <br />(10%) will be budgeted and included in the FY 2021-22 annual budget.