65A - AFFORDABLE HOUSING OPTIONS

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Discussion on Four Affordable Housing Development Projects and Options for City Financial Assistance June 1, 2017 Page 5 deadline. Planning staff have been reviewing the project since the approval of the initial 25 PBVs and the City has invested resources in the required NEPA environmental review. On May 22, the Planning Commission approved the entitlements for the project. The developer is preparing to apply for 9 percent competitive tax credits on June 28, 2017 As requested by the Ad Hoc Committee, CSG Advisors is conducting a financial gap analysis for affordable housing development funds in the event that the additional 31 PBV are not awarded. Tiny Tim Plaza, Community Development Partners: 2223 West 5th Street The Tiny Tim Plaza project consists of a 51 -unit new construction affordable housing development targeting low-income families making 30%-60% AMI, including 5 units targeting at - risk homeless families. This development was identified as one of the projects in the queue and as such, on February 28, 2017, the Ad Hoc Committee requested a financial gap analysis be conducted to determine the financial assistance for the project. On May 18, 2017, the developer, Community Development Partners, requested that the City commit affordable housing funds during the month of June as the commitment will provide for a favorable outcome in the acquisition of land and closing of escrow tentatively scheduled for July. On May 24, as requested by the Ad Hoc Committee, CSG Advisors completed the financial gap analysis and determined $11.7 million as the financial gap for the project (Exhibit 8). The project will apply for 4 percent non-competitive tax credits in October 2017. Currently, the project is in planning development review and anticipated to be reviewed by the Planning Commission on September 11, 2017. Planning staff estimates that the project will be agendized for City Council consideration on October 3, 2017. Additional Ad Hoc Committee Recommendations: The Ad Hoc Committee recommended that the City Council direct staff to develop a policy and criteria for the allocation of future affordable housing development funds. It is anticipated that future federal funding for affordable housing may degrease requiring the City to prioritize projects for funding. The selection criteria would include elements such as; 1) affordability, 2) number of units, 3) operating costs to tenants, and 4) gap analysis. Upon the direction of the City Council, staff will conduct research and prepare options and recommendations for City Council consideration at a later date. Regarding the availability of affordable housing development funds, the Ad Hoc recommended that staff provide the City Council with the current available funds on hand and to estimate future funding. As provided in the May 2, 2017 quarterly report of Housing division projects and activities, the currently available affordable housing development funds amount is $18,661,468. This value includes Housing Successor Agency, Inclusionary Housing, HOME program and CDBG available funds as detailed in exhibit 1. In addition, staff estimates that the City will receive future Inclusionary Housing Funds from the Heritage Project (est. $9.7M) and 421 N. Harbor Blvd mixed use market -rate development project (est. $717,388). The future sale of Housing Successor Agency properties (four developable sites) may generate an estimated $4 65A-5