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Substantial Amendments - NSP 2 & 3 and Loan Agreement with 815 N Harbor LP September 16, 2013 Page 2 FINANCE, ECONOMIC DEVELOPMENT AND TECHNOLOGY COMMITTEE REVIEW The Finance, Economic Development and Technology Committee reviewed this matter at its meeting on August 6, 2013. The Committee has reviewed the recommended actions and recommends that the City Council to adopt and authorize actions. COMMUNITY REDEVELOPMENT AND HOUSING COMMISSION RECOMMENDATION At its regular meeting on September 3, 2013, by a vote of 5:0 (Aguinaga, Verino absent) the Community Redevelopment and Housing Commission conducted a public hearing and approved the recommended actions stated above. DISCUSSION SUBSTANTIAL AMENDMENTS TO NEIGHBORHOOD STABILIZATION PROGRAMS 2 & 3 The City of Santa was awarded $10 million in the second round of Neighborhood Stabilization Program (NSP 2) and allocated $1,464,113 in the third round of Neighborhood Stabilization Program (NSP 3) which is to be used to purchase foreclosed or abandoned properties. The proposed substantial amendment for NSP 2 will amend the program activities to include and reallocate funds for the redevelopment activity. This activity will allow the development of rental housing for low-income households at or below 60 percent of area median income. The requirement of 25 percent of NSP 2 funds spent on activities benefiting very low-income households has already been achieved through past activities. The proposed substantial amendment for NSP 3 will add the redevelopment activity. The eligible household incomes will be at 50 percent and 60 percent of the area median income (AMI). The proposed changes for the NSP 2 and NSP 3 are identified as follows: NSP 2 Program Activities Current Proposed Allocation Allocation 1. Down payment Assistance (up to 120% AMI) $ 400,000 $ 400,000 2. Acquisition, Rehabilitation & Resale of Single Family Residences (up to 120% AMI) $ 6,100,000 $ 5,171,380 3. Acquisition & Rehab of Rental Housing (up to 5)% AMI) $ 2,500,000 $ 2,500,000 4. Redevelopment of Vacant Properties as Rental Housing for Low-Income Households (up to 50% AMI) $ 0 $ 742,896 5. Redevelopment of Vacant Properties as Rental Housing $ 0 $ 185,724 80A-2