Item 21 - Amendment to the Affordable Housing Funds Policies and Procedures

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Affordable Housing Funds Policies and Procedures Page 19 IV.PRE-LOAN COMMITMENT Pre-Loan Commitment Following the RFP Process, Proposal Review, Determination of Reasonable Costs and Financial Feasibility, and the proposed project has received a determination from the Executive Director of the Planning and Building Agency that the proposed project is consistent with the City’s General Plan Land Use Element and Zoning Classification, conditional on meeting the other requirements and conditions outlined above, a pre-loan commitment letter may be drafted by the Housing Division, reviewed and approved by the Housing Division Manager, the City Attorney’s Office, and the Executive Director of Community Development, before being recommended for approval. For the purposes of this Policy, the Executive Director of the Planning and Building Agency shall evaluate consistency with the City’s General Plan Land Use Element and Zoning Classification based on the proposed project’s land use, maximum proposed floor area ratio (FAR), and maximum proposed dwelling units per acre (du/ac). The letter shall state the maximum amount of program funds reserved for the project and list all of the additional conditions, documents and steps that must be taken by the Borrower prior to loan closing. After the pre-loan commitment letter has been drafted, staff will prepare a written staff report recommending a commitment of funds for a proposal and explaining the reasons for the commitment. The recommendation will be made first by the Housing Division to the Community Redevelopment and Housing Commission (CRHC) to issue the commitment of program funds to the project in the form of an award of program funds. If recommended by the CRHC to City Council, a recommendation will then be made by the Housing Division to the City Council and/or Housing Authority for final approval of the commitment of program funds by motion adopted by the affirmative votes of at least two-thirds (2/3) of the members. If approved by City Council and/or the Housing Authority, a notice of the issuance of the pre- loan commitment shall be posted publicly, and a copy of such notice shall be published in a newspaper of general circulation, no later than 21 days after the commitment is issued. Upon issuance of a pre-loan commitment letter, the Housing Division shall work with the Developer to secure all of their remaining financing. If the conditions and projections for the project rent schedule or non-City loans changes or is modified after the pre-loan commitment letter is issued, a second underwriting and subsidy layering analysis will be conducted by a real estate advisor. Conflict of Interest No person who is an employee, agent, consultant, officer, or elected official or appointed official of the City who exercises or has exercised any function or responsibility regarding activities assisted with Program funds or who is in a position to participate in a decision making process or gain inside information concerning these activities, may obtain a financial interest or benefit from an activity, or have an interest in any contract, subcontract or agreement with respect thereto, or the proceeds thereunder, either for themselves or those with whom they have family or business ties, during their tenure or for one year thereafter. Exhibit 1