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Quarterly Report for Housing Division <br />Projects and Activities <br />March 7, 2011 <br />Page 3 <br />Construction Process <br />During this phase, homeowners are guided through an open selection of contractors to complete <br />the work on their homes. Each homeowner is given a list of contractors that have been screened <br />by staff for insurance and bonding requirements. However, homeowners are allowed to select any <br />contractor that is licensed and meets insurance and bonding requirements. Staff assists the <br />homeowners in selection of a contractor, monitors the construction work, approves payments to <br />contractors, and tracks expenditures to ensure they do not exceed available funds. Multifamily <br />projects may involve additional issues such as compliance with prevailing wage requirements <br />and/or Davis-Bacon. As of December 31, 2010, there were 34 multifamily units and four single <br />family units for a total of 38 units underway. <br />Loan Portfolio Management and Monitoring <br />The Housing Division is responsible for ensuring the integrity of the residential loan portfolio. As of <br />the end of the second quarter, the principal balance was $74,730,818. This is comprised of 455 <br />loans of which 395 are deferred or residual receipt payment loans. The loan portfolio generated <br />$174,962.29 in payments of principal and interest during the first two quarters of the fiscal year. <br />As part of the requirements for these funds, staff must monitor the owner-occupancy for single <br />family homes that have received loans and the physical quality of units in the rental projects with <br />long-term affordability covenants. During the first two quarters of the fiscal year, 110 letters were <br />sent to homeowners to verify that they continue to occupy the home as their primary residence. <br />Under the terms of the HOME program, units assisted with these funds must periodically be <br />inspected for compliance with the City's building codes. During the first two quarters of the fiscal <br />year, staff conducted the necessary inspections for four HOME-assisted projects containing a total <br />of 140 units. Of the 140 units, only a sampling is required to be inspected. This quarter, 14 units <br />were inspected and six units failed inspection. Project owners are required to make necessary <br />repairs for all units found to be out of compliance. <br />Development Projects <br />703 N. Lacy Street <br />On January 5, 2009, the City Council and Agency approved loans to OHDC and C&C <br />Development for acquisition and rehabilitation of a 27-unit building at 703 N. Lacy Street. Rents <br />are restricted to extremely low- and very low-income households. Rehabilitation on this project is <br />complete and 26 units have been leased to income qualified residents. The developer is working <br />with its lender and tax credit equity investor to convert the construction loan to a permanent loan. <br />The estimated conversion date is April 2011. <br />19D-3