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Loan Agreement — CDBG and Inclusionary Housing Funds Santa Ana Arts Collective, LP <br />February 2, 2016 <br />Page 3 <br />Permanent Funding Sources <br />Amount <br />Permanent Loan <br />$ 3,788,911 <br />City of Santa Ana — HOME <br />2,260,000 <br />City of Santa Ana — CDBG <br />500,000 <br />City of Santa Ana — Inclusionary Housing Funds <br />1,875,000 <br />HCD — Affordable Housing & Sustainable Communities (Cap & Trade Funds ) <br />3,500,000 <br />Tax Credit Equity <br />14,213,448 <br />Deferred Developer Fee <br />420,974 <br />TOTAL: <br />$ 26,558,333 <br />Project Costs <br />Amount <br />Land Acquisition Costs <br />$ 7,255,522 <br />Construction Costs <br />10,917,565 <br />Architectural & Engineering <br />830,000 <br />Operating Reserve <br />219,682 <br />Relocation <br />782,000 <br />Additional Project Costs <br />4,553,564 <br />Developer Fee <br />2,000,000 <br />TOTAL: <br />$ 26,558,333 <br />The City's funding sources including HOME Program funds, CDBG Program funds, and <br />Inclusionary Housing funds will be provided by means of 55 -year City loans carrying a three <br />percent interest rate and payable by residual receipts. The loan agreement for the CDBG <br />Program funds and Inclusionary Housing funds will be executed upon approval from City Council <br />(Exhibit 2). <br />ENVIRONMENTAL IMPACT <br />In accordance with the California Environmental Quality Act, the recommended action is exempt <br />from further review per Section 15194. This affordable housing exemption is applicable as the <br />proposed project is on a site that is less than 5 acres in size; is within an urbanized area that has <br />a density of at least 5,000 persons per square mile; is located on a site that has previously been <br />developed for urban uses; consists of 100 or fewer units that are affordable to low income <br />housing; and, the developer will provide sufficient legal commitments to ensure continued <br />availability and use of the housing for lower income housing for at least 30 years. Categorical <br />Exemption Environmental Review No. 2016 -06 will be filed for this project. <br />STRATEGIC PLAN ALIGNMENT <br />The activities covered by this report allow the City to meet Goal #5 - Community Health, Livability, <br />Engagement & Sustainability, Objective # 3 (Facilitate diverse housing opportunities and support <br />efforts to preserve and improve the livability of Santa Ana neighborhoods), Strategy A (Continue <br />to explore options Citywide regarding the re -use of commercial or industrial buildings that are <br />25B -3 <br />