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Judson Brown, City of Santa Ana March 1, 2017 <br />Santa Ana Arts Collective: Financial Gap Analysis Page 10 <br />4. A $146,000 capitalized operating reserve is provided. This equates to three months of <br />operating expenses and debt service payments on the permanent loan supported by the <br />Project's income. <br />5. The Tax Credit fees are estimated at $97,000 based on the following: <br />a. A $2,000 application fee; <br />b. A $410 per unit monitoring fee; and <br />C. Four percent (4%) of the gross Tax Credit proceeds for one year. <br />KMA estimates the total financing costs at $2.06 million. <br />Total Development Costs <br />As shown in Table 1, KMA estimates the total development costs at $34.15 million, which <br />equates to approximately $588,700 per unit. In comparison, the Developer estimates the total <br />development costs at $34.18 million, or $589,300 per unit. This equates to a less than 1% <br />differential, which can be considered inconsequential. <br />Stabilized Net Operating Income <br />The Project's funding sources are likely to include City Housing Opportunity Ordinance (H00) in - <br />lieu fees, HOME Program funds, CDBG funds, AHSC funds, and 9% Tax Credits. The Project's <br />income and affordability standards must comport with the most stringent of the following <br />standards: <br />1. Income Restrictions: The tenants' household incomes cannot exceed the strictest of: <br />a. HOME Program income restrictions as defined under United States Code, Title <br />26, Section 142(d)(2)(B). <br />b. Federal Low Income Housing Tax Credits income restrictions defined under <br />United States Code, Title 26, Section 142(d)(2)(B). <br />2. Affordability Restrictions: Rents applied to all the units must reflect the most stringent <br />of: <br />a. HOME Program rents published annually by HUD; and <br />b. Tax Credit rents published annually by TCAC. <br />1703001:SNA:TRB <br />19090.014.007 <br />65A-26 <br />