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REQUEST FOR <br />COUNCIL ACTION <br />CITY COUNCIL MEETING DATE: <br />OCTOBER 18, 2010 <br />TITLE: <br />APPROPRIATION ADJUSTMENT - LOAN <br />AGREEMENT WITH IRENE M. MAYORGA FOR <br />REHABILITATION OF 601 E. 20TH STREET <br />CITY MANAGER <br />RECOMMENDED ACTION <br />CLERK OF COUNCIL USE ONLY: <br />APPROVED <br />❑ As Recommended <br />❑ As Amended <br />❑ Ordinance on 1st Reading <br />❑ Ordinance on 2 "6 Reading <br />❑ Implementing Resolution <br />❑ Set Public Hearing For_ <br />CONTINUED TO <br />FILE NUMBER <br />Approve an appropriation adjustment recognizing a $900,000 CalHome Program Grant from <br />the California Department of Housing and Community Development and appropriating the <br />same to fund eligible single family rehabilitation loans. <br />2. Authorize the City Manager and Clerk of the Council to execute the attached rehabilitation <br />loan agreement with Irene M. Mayorga for the rehabilitation of her home at 601 E. 20th <br />Street in the amount not to exceed $135,000, subject to non - substantive changes approved <br />by the City Manager and City Attorney. <br />DISCUSSION <br />We applied for and were awarded $900,000 through the California Department of Housing and <br />Community Development's CalHome Program. Funds are to be used for single family <br />rehabilitation loans with a term of 30 years, zero percent interest and no payments. The <br />maximum allowable loan is $60,000. The funds must be recognized and budgeted before they <br />can be used. <br />The City of Santa Ana offers other single family rehabilitation loan programs that enable low - <br />income Santa Ana homeowners to make necessary repairs to their homes. These loans are <br />funded through a variety of sources, including the federal Community Development Block Grant <br />(CDBG) and HOME grant programs, for which the maximum loan amount is $75,000. <br />Homeowners are required to make all code - related repairs and to utilize the services of a <br />licensed and insured general contractor. Non - essential, luxurious repairs are not funded, and <br />homeowners are required to keep the home as their principle residence through the term of their <br />loan. Depending on circumstances and the funding source, loans are amortized over twenty to <br />thirty years; and payments are deferred for homeowners who are unable to make them. Interest <br />rates are well below market rates. Homeowners who are low- income currently receive a 1.5 <br />percent interest rate for HOME or CDBG funded loans. <br />20A -1 <br />