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Adoption of Proactive Rental Enforcement Program (PREP) April 19, 2016 Page 2 The present funding allocation for the Gold Seal program is $110,000 which will provide for 4,400 units to receive exemptions from the $25 per unit annual fee. The primary concentration of the PREP inspections is on the exterior maintenance of rental properties, such as poor landscaping, unsightly paint, damaged fencing, illegal storage or inoperable vehicles. Should a condition be observed that leads to suspicion of a more serious issue being present on the property, or within the structure, a thorough inspection is conducted. Code enforcement staff also responds to complaints received pertaining to rental properties. Due to the proactive nature of the program, code enforcement staff addresses conditions of the rental properties before adjacent impacted neighbors are compelled to file a complaint. The on- going challenge for code enforcement staff is to maintain improvements made in the completed areas, while moving on to conduct inspections in the next quadrant. Properties that rapidly deteriorate generate most of the complaints received by code enforcement staff. The PREP program has proven beneficial to Santa Ana by maintaining the City's rental housing at an acceptable standard. The program receives positive reviews from residents for the improved appearance of their neighborhoods and from the rental housing industry for abiding by the approved guidelines and not generating complaints to their respective associations. In calendar year 2015, based on PREP enforcement efforts, staff generated 210 permits with a total valuation of $1,541,084.02 in improvements to rental properties. With proven success in reducing complaints received for rental properties, noticeably improving the appearance of many rental properties and maintaining support of the rental housing industry, the Planning and Building Agency is requesting the approval of the PREP program to allow inspection of all rental housing in the City. In addition it is requesting the authorization of the required funding for the Gold Seal Incentive Program. For the purposes of cost administration it is also requesting approval to annually adjust the per unit fee based on a percentage reflected by the change in the Consumers Price Index - Urban, All Services Component for the Los Angeles - Riverside- Orange County area. ENVIRONMENTAL IMPACT The PREP program is exempt from CEQA pursuant to Section 15061(b)(3) of CEQA Guidelines in that it can be seen with certainty that the rental inspection program will have no possible significant effect on the environment. Additionally, the PREP program is further exempted pursuant to the Class 21 Categorical Exemption, Section 15321 of the CEQA Guidelines, which exempts enforcement actions of regulatory agencies. Categorical Exemption No. ER- 2015 -96 has been adopted for this program. 75B -2