HomeMy WebLinkAbout80A - HA ANNUAL REPORTREQUEST FOR COUNCIL/
HOUSING AUTHORITY
ACTION
CITY COUNCIL MEETING DATE:
18, 2018
TITLE:
RECEIVE AND FILE HOUSING SUCCESSOR
ANNUAL REPORT FOR FY 2017-18 — LOW
AND MODERATE INCOME HOUSING
ASSET FUND
{STRATEGIC PLAN NO. 5, 1}
CITY MANAGEN EXECUTIVE DI CTOR
RECOMMENDED ACTION
Receive and file.
HOUSING AUTHORITY ACTION
Receive and file.
DISCUSSION
CLERK OF COUNCIL USE ONLY:
•:•
❑ As Recommended
❑ As Amended
❑ Ordinance on 1a Reading
❑ Ordinance on 2nd Reading
❑ Implementing Resolution
❑ Set Public Hearing For
CONTINUED TO
FILE NUMBER
Pursuant to the Dissolution Act, the City Council on January 9, 2012, designated the Housing
Authority as the Successor Housing Agency to the dissolved Community Redevelopment Agency
of the City of Santa Ana (RDA). Effective February 1, 2012, the Housing Authority retained the
housing assets, duties, functions and obligations of the former RDA and continued to complete
the housing development projects encumbered prior to the dissolution of the RDA.
Senate Bill (SB) 341, signed by the Governor on October 1, 2013, amended the Health & Safety
Code Section 34176 and addresses functions to be performed by the Housing Successor
Agencies. This bill, effective January 2014, requires all housing successor agencies to provide
an annual report to its governing body within six months after the end of the fiscal year, starting
with FY 2013-14. Among the requirements is an independent financial audit of the Low and
Moderate Income Housing Asset Fund (LMIHAF), and information regarding specific housing
financial data and activities. The independent financial audit of the LMIHAF is included in the
City's Comprehensive Annual Financial Report (CAFR) for FY 2017-18, as prepared by the
Finance and Management Services Agency and posted on the City's website at
hftps://www.santa-ana org/finance/comprehensive-annual-financial-reports-cafr-and-other-
financial-reports.
80A-1
Housing Successor Annual Report FY 2017-18
December 18, 2018
Page 2
STRATEGIC PLAN ALIGNMENT
Approval of this item supports the City's efforts to meet Goal #5 — Community Health, Livability,
Engagement & Sustainability, Objective #1, Establish a comprehensive community engagement
initiative to expand access to information and create opportunities for stakeholders to play an
active role in discussing public policy and setting priorities.
FISCAL IMPACT
There is no fiscal impact associated with this action.
ICY ,
Steven A. Mendoza
Executive Director
Community Development Agency
sg/bz
Exhibit: 1. Housing Successor Annual Report FY 2017-18
80A-2
EXHIBIT 1
HOUSING SUCCESSOR ANNUAL REPORT
REGARDING THE
LOW AND MODERATE INCOME HOUSING ASSET FUND
FOR FISCAL YEAR 2017-2018
PURSUANT TO
CALIFORNIA HEALTH AND SAFETY CODE SECTION 34176.1 (f)
FOR THE
HOUSING AUTHORITY OF THE CITY OF SANTA ANA
This Housing Successor Annual Report (Report) regarding the Low and Moderate Income
Housing Asset Fund (LMIHAF) has been prepared pursuant to California Health and Safety
Code Section 34176.1(f) and is dated as of December 18, 2018. This Report sets forth certain
details of the Housing Authority of the City of Santa Ana (Housing Successor) activities during
Fiscal Year 2017-2018 (Fiscal Year). The purpose of this Report is to provide the governing
body of the Housing Successor an annual report on the housing assets and activities of the
Housing Successor under Part 1.85, Division 24 of the California Health and Safety Code, in
particular sections 34176 and 34176.1 (Dissolution Law).
The following Report is based upon information prepared by Housing Successor staff and
information contained within the independent financial audit of the Low and Moderate Income
Housing Asset Fund, as incorporated in the City of Santa Ana Comprehensive Annual Financial
Report for Fiscal Year 2017-2018 (Fiscal Year) as prepared by White Nelson Diehl Evans LLP
(Audit), which Audit is separate from this annual summary Report; further, this Report conforms
with and is organized into sections I. through XII., inclusive, pursuant to Section 34176.1(f) of
the Dissolution Law:
Amount Deposited into LMIHAF: This section provides the total amount of funds
deposited into the LMIHAF during the Fiscal Year. Any amounts deposited for items
listed on the Recognized Obligation Payment Schedule (ROPS) must be distinguished
from the other amounts deposited.
11. Ending Balance of LMIHAF: This section provides a statement of the balance in the
LMIHAF as of the close of the Fiscal Year. Any amounts deposited for items listed on
the ROPS must be distinguished from the other amounts deposited.
III. Description of Expenditures from LMIHAF: This section provides a description of the
expenditures made from the LMIHAF during the Fiscal Year. The expenditures are to be
categorized.
IV. Statutory Value of Assets Owned by Housing Successor: This section provides the
statutory value of real property owned by the Housing Successor, the value of loans and
grants receivables, and the sum of these two amounts.
HOUSING AUTHORITY OF THE CITY OF SANTA WAZO3118 Page 1
V. Description of Transfers: This section describes transfers, if any, to another housing
successor agency made in previous Fiscal Year(s), including whether the funds are
unencumbered and the status of projects, if any, for which the transferred LMIHAF will
be used. The sole purpose of the transfers must be for the development of transit
priority projects, permanent supportive housing, housing for agricultural employees or
special needs housing.
VI. Project Descriptions: This section describes any project for which the Housing
Successor receives or holds property tax revenue pursuant to the ROPS and the status
of that project.
VII. Status of Compliance with Section 33334.16: This section provides a status update
on compliance with Section 33334.16 for interests in real property acquired by the
former redevelopment agency prior to February 1, 2012. For interests in real property
acquired on or after February 1, 2012, provide a status update on the project.
VIII. Description of Outstanding Obligations under Section 33413: This section
describes the outstanding inclusionary and replacement housing obligations, if any,
under Section 33413 that remained outstanding prior to dissolution of the former
redevelopment agency as of February 1, 2012 along with the Housing Successor's
progress in meeting those prior obligations, if any, of the former redevelopment agency
and how the Housing Successor's plans to meet unmet obligations, if any.
IX. Income Test: This section provides the information required by Section
34176.1(a)(3)(B), or a description of expenditures by income restriction for five year
period, with the time period beginning January 1, 2014 and whether the statutory
thresholds have been met. However, reporting of the Income Test is not required until
2019.
X. Senior Housing Test: This section provides the percentage of units of deed -restricted
rental housing restricted to seniors and assisted individually or jointly by the Housing
Successor, its former redevelopment Agency, and its host jurisdiction within the previous
10 years in relation to the aggregate number of units of deed -restricted rental housing
assisted individually or jointly by the Housing Successor, its former Redevelopment
Agency and its host jurisdiction within the same time period. For this Report the ten-year
period reviewed is January 1, 2008 to December 31, 2017.
XI. Excess Surplus Test: This section provides the amount of excess surplus in the
LMIHAF, if any, and the length of time that the Housing Successor has had excess
surplus, and the Housing Successor's plan for eliminating the excess surplus.
XII. Inventory of Homeownership Units: This section provides an inventory of
homeownership units assisted by the former redevelopment agency or the Housing
Successor that are subject to covenants or restrictions or to an adopted program that
HOUSING AUTHORITY OF THE CITY OF SANTA AN
gI(204/18 Page 2
protects the former redevelopment agency's investment of moneys from the Low and
Moderate Income Housing Fund pursuant to Section 33334.3(f).
This Report is to be provided to the Housing Successor's governing body by December 31,
2018. In addition, this Report and the former redevelopment agency's pre -dissolution
Implementation Plans are to be made available to the public on the City's website
(https://www.santa-ana.orq/cd/oversight-board.)
AMOUNT DEPOSITED INTO LMIHAF
A total of $540,960 was deposited into the LMIHAF during the Fiscal Year. Of the total funds
deposited into the LMIHAF, a total of $0 was held for items listed on the ROPS.
II. ENDING BALANCE OF LMIHAF
At the close of the Fiscal Year, the ending balance in the LMIHAF was $5,958,193 of which
$250,000 is held for items listed on the ROPS.
III. DESCRIPTION OF EXPENDITURES FROM LMIHAF
The following is a description of expenditures from the LMIHAF by category:
751 '
I Homeless Prevention and Rapid Rehousing Services Expenditures $ 0 1
Housing Development Expenditures
➢ Expenditures on Low Income Units $ 10,848
➢ Expenditures on Very -Low Income Units $ 0
➢ Expenditures on Extremely -Low Income Units $ 0
Total LMIHAF Expenditures in Fiscal Year
' The independent financial audit of the LMIHAF includes an additional $6,638,677 for bad debt
expenses for loans receivable, for a total expenditure of $6,803,428.
2 Including the additional item from footnote 1 above, the total LMIHAF per the audit is $6,814,276.
HOUSING AUTHORITY OF THE CITY OF SANTA /80AZ57/18 Page 3
IV. STATUTORY VALUE OF ASSETS OWNED BY HOUSING SUCCESSOR IN LMIHAF
Under the Dissolution Law and for purposes of this Report, the "statutory value of real property"
means the value of properties formerly held by the former redevelopment agency as listed on
the housing asset transfer schedule approved by the Department of Finance as listed in such
schedule under Section 34176(a)(2), the value of the properties transferred to the Housing
Successor pursuant to Section 34181(f), and the purchase price of property(ies) purchased by
the Housing Successor. Further, the value of loans and grants receivable is included in these
reported assets held in the LMIHAF.
The following provides the statutory value of assets owned by the Housing Successor.
As . .
Fiscal Year
Statutory Value of Real Property Owned by Housing Authority $ 2,855,050
Value of Loans and Grants Receivable $27,925,601
Total Value of Housing Successor Assets $30,780,651
V. DESCRIPTION OF TRANSFERS
The Housing Successor did not make any LMIHAF transfers to other Housing Successor(s)
under Section 34176.1(c)(2) during the Fiscal Year.
VI. PROJECT DESCRIPTIONS
The following is a description of project(s) for which the Housing Successor receives or holds
property tax revenue pursuant to the ROPS as well as the status of the project(s):
Habitat for Humanity 4110 W. McFadden was transferred to the
developer in FY 2016-17 and construction of
the five homes has been completed. Final sale
of the homes anticipated in FY 2018-19.
VII. STATUS OF COMPLIANCE WITH SECTION 33334.16
Section 34176.1 provides that Section 33334.16 does not apply to interests in real property
acquired by the Housing Successor on or after February 1, 2012; however, this Report presents
a status update on the project related to such real property.
With respect to interests in real property acquired by the former redevelopment agency prior to
February 1, 2012, the time periods described in Section 33334.16 shall be deemed to have
commenced on the date that the Department of Finance approved the property as a housing
HOUSING AUTHORITY OF THE CITY OF SANTA ty,tpA2p 18 Page 4
asset in the LMIHAF; thus, as to real property acquired by the former redevelopment agency
now held by the Housing Successor in the LMIHAF, the Housing Successor must initiate
activities consistent with the development of the real property for the purpose for which it was
acquired within five years of the date the DOF approved such property as a housing asset.
The following provides a status update on the real property or properties housing asset(s) that
were acquired prior to February 1, 2012 and compliance with five-year period:
The following provides a status update on the project(s) for property or properties that have
been acquired by the Housing Successor using LMIHAF on or after February 1, 2012:
VIII. DESCRIPTION OF OUTSTANDING OBLIGATIONS PURSUANT TO SECTION 33413
Replacement Housing: According to the FY 2010 — FY 2015 Implementation Plan for the
former redevelopment agency, the following replacement housing obligations were transferred
to the Housing Successor:
HOUSING AUTHORITY OF THE CITY OF SANTA /80rA 2Cf7/18 Page 5
Deadline
Date of
Initiate
Development
Address..
Remnant parcels at
10/30/02
02/14/18
Included in Request for
Spurgeon & E. 22"a St.
Proposals #18-056 for the
development and/or sale of
the site
801, 809 8.8091/2 E.
07/29/09
02/14/18
Included in Request for
Santa Ana Blvd.
Proposals #18-056 for the
development and/or sale of
the site
826 N. Lacy
07/29/09
02/14/18
Included in Request for
Proposals #18-056 for the
development and/or sale of
the site
1126 & 1146 Washington
09/05/07
02/14/18
Included in Request for
Proposals #18-056 for the
development and/or sale of
the site
The following provides a status update on the project(s) for property or properties that have
been acquired by the Housing Successor using LMIHAF on or after February 1, 2012:
VIII. DESCRIPTION OF OUTSTANDING OBLIGATIONS PURSUANT TO SECTION 33413
Replacement Housing: According to the FY 2010 — FY 2015 Implementation Plan for the
former redevelopment agency, the following replacement housing obligations were transferred
to the Housing Successor:
HOUSING AUTHORITY OF THE CITY OF SANTA /80rA 2Cf7/18 Page 5
One (1) very -low income five -bedroom unit was removed in 2005. The replacement housing
obligation transferred to the Housing Successor was fulfilled in a previous fiscal year with the
WBBB project that accommodated a five -bedroom unit within the site.
At the end of Fiscal Year 2017-2018, the Housing Successor has met all replacement housing
obligations transferred from the former redevelopment agency.
Inclusionary/Production Housing. According to the FY 2010 — FY 2015 Implementation Plan
for the former redevelopment agency, no Section 33413(b) inclusionary/production housing
obligations were transferred to the Housing Successor. The former redevelopment agency's
Implementation Plans are posted on the City's website at hftps://www.santa-
ana.or_q/cd/oversight-board.
IX. EXTREMELY -LOW INCOME TEST
Section 34176.1(a)(3)(B) requires that the Housing Successor must require at least 30% of the
LMIHAF to be expended for development of rental housing affordable to and occupied by
households earning 30% or less of the AMI. If the Housing Successor fails to comply with the
Extremely -Low Income requirement in any five-year report, then the Housing Successor must
ensure that at least 50% of the funds remaining in the LMIHAF be expended in each fiscal year
following the latest fiscal year following the report on households earning 30% or less of the AMI
until the Housing Successor demonstrates compliance with the Extremely -Low Income
requirement. This information is not required to be reported until 2019 for the 2014 — 2019
period.
X. SENIOR HOUSING TEST
The Housing Successor is to calculate the percentage of units of deed -restricted rental housing
restricted to seniors and assisted by the Housing Successor, the former redevelopment agency
and/or the City within the previous 10 years in relation to the aggregate number of units of
deed -restricted rental housing assisted by the Housing Successor, the former redevelopment
agency and/or City within the same time period. If this percentage exceeds 50%, then the
Housing Successor cannot expend future funds in the LMIHAF to assist additional senior
housing units until the Housing Successor or City assists and construction has commenced on a
number of restricted rental units that is equal to 50% of the total amount of deed -restricted rental
units.
The following provides the Housing Successor's Senior Housing Test for the 10 year period of
January 1, 2008 to December 31, 2017:
HOUSING AUTHORITY OF THE CITY OF SANTA PM f/K IW118 Page 6
A. EXCESS SURPLUS TEST
Excess Surplus is defined in Section 34176.1(d) as an unencumbered amount in the account
that exceeds the greater of one million dollars ($1,000,000) or the aggregate amount deposited
into the account during the Housing Successor's preceding four Fiscal Years, whichever is
greater.
The following provides the Excess Surplus test for the preceding four Fiscal Years:
3 The FY 2015/16 beginning balance is restated due to the reclassification of the long-term loans
receivable from deferred inflows of resources, unavailable revenue, to an allowance for uncollectible
accounts.
HOUSING AUTHORITY OF THE CITY OF SANTA)8o I�' 297/18 Page 7
FY i
i2017118
Beginning Balance
$17,996,580
$48,615,116
$46,541,115
$42,936,847
Add: Deposits
$2,329,877
$312,836
$138,585
$540,960
(Less) Expenditures
$950,279
$2,386,837
$3,742,853
$6,814,276
Ending Balance
$19,376,178
$46,541,115
$42,936,847
$36,663,531
3 The FY 2015/16 beginning balance is restated due to the reclassification of the long-term loans
receivable from deferred inflows of resources, unavailable revenue, to an allowance for uncollectible
accounts.
HOUSING AUTHORITY OF THE CITY OF SANTA)8o I�' 297/18 Page 7
The LMIHAF does not have an Excess Surplus. (Refer to calculation below.)
Fund Balance — June 30, 2017 $42,936,847
Less Unavailable Amounts:
Advance to private -purpose trust fund ( 532,601)
Community development ( 39,549,196)
Land held for resale ( 2,855,050)
Available Low Income Housing Funds
Limitation (Greater of $1,000,000 or Four Years Deposits):
Aggregate amounts deposited for preceding four fiscal years
2014-2015 2,329,877
2015-2016 312,836
2016-2017 138,585
2017-2018 540,960
Total deposits for the preceding four fiscal years 3,322,258
Base limitation 1,000,000
Greater Amount 3,322,258
Computed Excess Surplus — June 30, 2018 $
XII. INVENTORY OF HOMEOWNERSHIP UNITS
(A) As of June 30, 2018, there was a total of 52 homeownership units and 796 rental
units subject to covenants or restrictions. Of this total, all 848 units had
affordability restrictions.
(B) Since February 1, 2012, the number of units lost to the portfolio is 25; 14 single
family units and 11 multi -family residential units.
(C) There were no funds returned to the Housing Successor as part of an adopted
program that protects the former redevelopment agency's investment of moneys
from the former Low and Moderate Income Housing Fund in FY 2017-18.
(D) The Housing Authority of the City of Santa Ana has not contracted with any
outside entity for the management of the units.
HOUSING AUTHORITY OF THE CITY OF SANTA M211fi18 Page 8