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HomeMy WebLinkAbout19C - HOUSING DIV PROJECT REPORTREQUEST FOR COUNCIL ACTION MAY 1, 2018 TITLE: RECEIVE AND FILE THE QUARTERLY REPORT FOR HOUSING DIVISION PROJECTS AND ACTIVITIES JANUARY 2018 — MARCH 2018 (STRATEGIC PLAN NO. 5,3) CITY M AGERM AGER RECOMMENDED ACTION CLERK OF COUNCIL USE ONLY: APPROVED ❑ As Recommended ❑ As Amended ❑ Ordinance on 1� Reading ❑ Ordinance on 2nd Reading ❑ Implementing Resolution ❑ Set Public Hearing For CONTINUED TO FILE NUMBER Receive and file the Quarterly Report for Housing Division Projects and Activities for the period of January 2018 — March 2018. COMMUNITY REDEVELOPMENT AND HOUSING COMMISSION ACTION . At a Special Meeting on April 11, 2018, by a vote of 6:0 (Frazier and Ramos absent), the Community Redevelopment and Housing Commission approved the recommended action. DISCUSSION This report for the quarter ending on March 31, 2018 provides statistics for all of the affordable housing projects and activities for the Housing Division. The report is divided into three sections: Loan Activity, Loan Portfolio Management and Monitoring, Affordable Housing Funds and Commitments, and Development Projects. Loan Activity Applications The Housing Division offers several different programs including down payment assistance for first-time homebuyers and rehabilitation loans for mobile homes, single-family, multi -family, and historic homes. Inquiries are received from the public and applications are mailed out, received and approved for these programs on a continual basis. Table 1 shows the number of inquiries, applications sent out, received and approved by type for the quarter and for the total fiscal year. 19C-1 Quarterly Report for Housing Division May 1, 2018 Page 2 Table 1: Applications Sent Out, Received & Approved Program Q3 Inquiries Total FY Applications Sent Out Q3 Total FY Applications Received Q3 Total FY Applications A proved Q3 Total FY Single -Family Rehabilitation 75 136 75 125 4 10 2 3 Mobile Home Rehabilitation 10 60 5 47 1 5 2 3 Multi -Family Rehabilitation 0 0 0 0 0 0 0 0 Historic Home Restoration 1 4 0 3 0 0 0 0 Homeownership 60 175 45 139 1 1 3 0 0 Rehabilitation Loan Underwriting and Approval Progress For the rehabilitation loans, staff reviews applicant eligibility, verifies income and assets, and oversees underwriting to ensure compliance with program guidelines and requirements established by the funding source. In addition, staff conducts an inspection of the property, prepares a work write-up to determine rehabilitation work to be performed, and develops a budget for the work. Due to the complex funding requirements, applications may be in underwriting for several months. The length of time in underwriting is largely determined by the applicant's timely submittal of the necessary paperwork. Once approved, staff prepares all necessary loan documents, makes arrangements for loan execution, and reserves the required loan funds. During this quarter, two (2) mobile home loans were approved, two (2) Single Family Rehabilitation loans were approved and five (5) inclusionary housing purchases at City Ventures were approved. Rehabilitation Proaram Construction Progress During this phase, homeowners receiving rehabilitation loans are guided through an open selection of contractors to complete the work on their homes. Each homeowner is given a list of contractors that have been screened by staff for license and insurance requirements. However, homeowners are allowed to select any contractor that meets these same requirements. Staff assists the homeowners with the evaluation of bids and selection of a contractor. Staff also monitors the construction work, approves payments to contractors, and tracks expenditures to ensure compliance with the loan agreement and program guidelines. At the end of this quarter, there were three (3) homeowner rehabilitation projects out to bid and two (2) under construction. Down Payment Assistance Loan Program Progress For the Down Payment Assistance Loan Program, staff evaluates applicant eligibility and oversees underwriting to ensure compliance with program guidelines and requirements established by the U.S. Department of Housing and Urban Development (HUD). Applicants must meet established income requirements, complete an eight-hour pre -purchase counseling program from a HUD -approved agency, be pre -qualified for a first mortgage and have a minimum of three percent of the purchase price from their own savings. Other HUD requirements apply, including a current maximum sales price of $513,000 for a single family home or condo. During this quarter the City Council approved an update to the Down Payment Assistance Loan Program increasing the loan amount to $80,000 for low income households and approving the use of the 19C-2 Quarterly Report for Housing Division May 1, 2018 Page 2 Inclusionary Housing Fund to offer down payment assistance of up to $40,000 to moderate income households. The updated program requires the buyer must be a current resident of Santa Ana or work in Santa Ana at least 32 hour per week (except U.S Military Veterans). Additionally, the property needs to be in good condition and pass an inspection. During this quarter, staff conducted one (1) down payment assistance workshop in which a total of 25 people attended and made a Down Payment Assistance Loan Program presentation at Precise Investment Enterprises in Santa Ana, to a group of 40 local realtors and loan officers. Loan Portfolio Management & Monitoring The Housing Division is responsible for managing the residential loan portfolio which includes all of the loans entered into by the City and Housing Authority acting as the Housing Successor Agency. As of the end of this quarter, the principal balance was $120,980,386. This is comprised of 410 loans of which 386 are deferred or residual receipt payment loans. As shown in Table 2, the loan portfolio generated $38,494 in payments of principal and interest during this quarter. Table 2: Portfolio Revenue Monitoring As part of the requirements for these funds, staff must monitor the owner -occupancy of single family homes that have received loans, and the building code compliance of units in rental projects with long-term affordability covenants. During this quarter, 45 owner -occupancy recertification letters were mailed and 32 were returned and processed. Staff also audited files for five (5) loans and conducted building code compliance inspections for 97 units in nine (9) projects. Regulations require that only a sample of units be selected for inspection. Staff also inspects the grounds and common areas such as laundry rooms to ensure they also meet municipal code requirements. The grounds, common areas and all of the inspected units were found to be in compliance at the time of initial inspection. 19C-3 Funding Sources HOME CDBG Redevelopment NSP CaIHOME Loan Payoffs $0 $0 $0 $0 $0 Residual Receipts $0 $0 $0 $0 $0 Payments Amortized Loan $4,580 $12,760 $20,771 $0 $383 Payments Total For Q2 $4,580 $12,760 $20,771 $0 $383 Monitoring As part of the requirements for these funds, staff must monitor the owner -occupancy of single family homes that have received loans, and the building code compliance of units in rental projects with long-term affordability covenants. During this quarter, 45 owner -occupancy recertification letters were mailed and 32 were returned and processed. Staff also audited files for five (5) loans and conducted building code compliance inspections for 97 units in nine (9) projects. Regulations require that only a sample of units be selected for inspection. Staff also inspects the grounds and common areas such as laundry rooms to ensure they also meet municipal code requirements. The grounds, common areas and all of the inspected units were found to be in compliance at the time of initial inspection. 19C-3 Quarterly Report for Housing Division May 1, 2018 Page 3 Available Funds and Land Assets for Affordable Housing Development Projects The City of Santa Ana and the Housing Authority acting as the Housing Successor Agency manages multiple sources of local, state and federal funds to promote and facilitate the development of affordable housing as well as land assets held by the Housing Successor Agency. As of March 31, 2018, a total of $5,872,596 is available for affordable housing development. Exhibit 1 provides a summary of the funds available as of the end of this quarter. Exhibit 2 provides a summary of available land assets. Housing Opportunity Ordinance All in -lieu fees, penalties and other monies collected pursuant to the Housing Opportunity Ordinance, including interest, are deposited into the Inclusionary Housing Fund. Since inception, the Inclusionary Housing Fund has generated over $10.5 million to be used for the development of housing affordable to low and moderate income households, with a reasonable amount spent on administrative or related expenses associated with the administration of the Housing Opportunity Ordinance. To date, the Inclusionary Housing Fund has invested $6,075,000 towards the development of 107 affordable rental housing units in the City. In regards to affordable ownership housing units, a total of 23 inclusionary affordable homes have been produced and/or are under construction as a result of our Housing Opportunity Ordinance. Projects Under Development Below are brief summaries for projects under development. Exhibit 3 provides a development timeline for the larger development projects including the Depot at Santiago, the Orchard, the Santa Ana Arts Collective, First Street Apartments, Santa Ana Veterans Village, Aqua Housing, and Tiny Tim Plaza. For Sale Infill Housing (4010 - 4026 E. McFadden Street) • Developer: Habitat for Humanity of Orange County • Description: Acquisition and new construction project comprised of five (5) affordable single- family homes to be sold to qualified low- to moderate -income buyers. • City Funds: Land provided by the Redevelopment Agency • Status: Project is currently under construction and is expected to be completed in June 2018. Staff is working with the developer on the selection of qualified buyers. Depot at Santiago (923 N. Santiago Street) • Developer: C & C Development • Description: Acquisition, demolition and new construction project comprised of 69 affordable rental units, 1 manger's unit, a 3,000 SF community room, and 8,500 SF of retail space. • City Funds: HOME ($2,634,566), CDBG ($365,434), Eight (8) Project -Based Vouchers • Update: Project was completed in March 2018 and the tenants are expected to move in during April. 19C-4 Quarterly Report for Housing Division May 1, 2018 Page 4 The Orchard (2151 E. First Street) • Developer: Community Development Partners with Mercy House as the service provider • Description: Acquisition and rehabilitation of former motel yielding 71 units of affordable permanent supportive housing with wrap-around supportive services for chronically homeless individuals in the City of Santa Ana, and 1 manager's unit. • City Funds: HOME ($1,199,869), 71 Project -Based Vouchers ($7,895,194) • Update: Project was completed in January 2018. A grand opening and ribbon cutting ceremony was held on February 1, 2018. Santa Ana Arts Collective (1666 N. Main Street) • Developer: Meta Housing Corporation • Description: Acquisition, adaptive reuse and new construction project comprised of 57 affordable rental units designated for professional artists of all disciplines, and 1 manager's unit. • City Funds: Inclusionary Housing ($4,775,000), HOME ($2,219,760), CDBG ($500,000) • Update: Revised structural and engineering plans are under review. Epoxy injection is about 90% complete. First Street Apartments (1440 E. First Street) • Developer: AMCAL Multi -Housing, LLC. • Description: Demolition and new construction of an affordable multifamily apartment complex consisting of 68 units of rental housing serving very -low and extremely -low income families, and 1 manager's unit. • City Funds: Housing Successor Agency ($8,522,740), Eight (8) Project -Based Vouchers • Update: Loan documents recorded, escrow closed March 2018 and AMCAL is in the process of obtaining permits. Santa Ana Veterans Village (3312 W. First Street) • Developer: Jamboree Housing Corporation with Step Up on Second as the service provider • Description: New construction of an affordable multifamily apartment complex consisting of 75 units of permanent supportive housing with wrap-around supportive services for HUD-VASH eligible homeless veterans in the City of Santa Ana, and 1 manager's unit. • City Funds: 75 HUD-VASH Project -Based Vouchers ($11,489,000), HOME ($353,962) • Update: Jamboree Housing received an award of Special Needs Housing Program funds from the County of Orange for 20 of the 75 units ($2,912,000). With this additional financing, on February 28, 2018 Jamboree applied for 9% Low Income Housing Tax Credits. Aqua Housing (317 E. 176h Street) • Developer: Community Development Partners with Mercy House as the service provider • Description: Acquisition, demolition and new construction of a former motel yielding 56 units of affordable permanent supportive housing with wrap-around supportive services for chronically homeless individuals in the City of Santa Ana, and 1 manager's unit. • City Funds: 56 Project -Based Vouchers ($9,237,900) 19C-5 Quarterly Report for Housing Division May 1, 2018 Page 5 • Update: Community Development Partners (CDP) received an award of Special Needs Housing Program funds from the County of Orange for 9 of the 56 units ($1,310,400). On February 28, 2018, CDP applied for 9% Low Income Housing Tax Credits and is awaiting the award. Tiny Tim Plaza (2223 West 5th Street) • Developer: Community Development Partners • Description: New construction of an affordable multifamily apartment complex consisting of 51 units of rental housing serving very -low and extremely -low income families, and 1 manager's unit. • City Funds: Inclusionary Housing ($1,300,000), Housing Successor Agency ($4,700,000) • Update: CDP is currently pursuing other sources of financing to fill an estimated financial gap of approximately $11.7 million. On January 16, 2018, CDP submitted an application for Affordable Housing and Sustainable Communities grant funds and for Infill Infrastructure Grant Program funds from the California Department of Housing and Community Development. If successful, CDP will apply for 4% over- the-counter Low Income Housing Tax Credits. NSP 1. 2 and 3 Programs The City will make the NSP Program funds available for eligible projects in an upcoming Request for Proposals. STRATEGIC PLAN ALIGNMENT The activities covered by this report allow the City to meet Goal # 5 - Community Health, Livability, Engagement & Sustainability, Objective # 3 (Facilitate diverse housing opportunities and support efforts to preserve and improve the livability of Santa Ana neighborhoods). FISCAL IMPACT There is no fiscal impact associated with this action. Judson Brown Acting Executive Director Community Development Agency Exhibits: 1. Available Funds for Affordable Housing Development Projects 2. Available Land Assets for Affordable Housing Development 3. Project Timelines 19C-6 Exhibit 1 Available Funds for Affordable Housing Development Projects As of March 31, 2018 Housing Successor Agency (Housing Authority) $5,554,147 Cash on Hand ($85,227) First Street Apartments Loan' ($4,700,000) Tiny Tim Plaza Conditional Pre -Commitment Loan 2 ($276,628) Habitat for Humanity Disposition and Development Agreement ($250,000) Administrative Costs Allowance 3 $242,292 Available Funds Inclusionary Housing Funds $5,594,978 Cash on Hand" ($468,483) Santa Ana Arts Collective Project Costs 5 ($1,300,000) Tiny Tim Plaza Conditional Pre -Commitment Loan 2 ($284,522) Administrative Costs Allowance (CDA/PBA) ($400,000) Down Payment Assistance Program 7 $3,141,974 Available Funds HOME Program $1,868,102 Funds to Drawdown ($353,963) Santa Ana Veterans Village Pre -Commitment Loan B $1,514,139 Available Funds to Drawdown CDBG Program (Acquisition/Rehabilitation Projects Only) $974,191 Funds to Drawdown $974,191 Available Funds to Drawdown $5,872,596 Total Available Funds ' Approved by Housing Authority on January 16, 2018. 90% of loan paid on March 13, 201 a; 10% remaining to be paid upon completion of construction. a Approved by City CountiVHousing Authonty on June 20, 2017. The Housing Successor Agency relies on available cash to fund the monitoring and compliance functions related to the former Redevelopment Agency's housing loans. ° PR Broadslone Heritage Holdings, Phase l paid tr4ieu fees in the amount of$2,712,304.10 in November 2017. ° Project costs only;84.8M in loans approved by City Counul paid on July 26, 2017. ° Approved by City Council on February 7, 2017. 7 Approved by City Council on March e, 2018. 19C-7 19C-8 EXHIBIT 2 AVAILABLE LAND ASSETS FOR AFFORDABLE HOUSING DEVELOPMENT (1) Remnant parcels at Spurgeon & E. 22nd Street (302 E. Twenty -Second Street) a. APN: 003-122-25 b. Lot Size: 27,817 sf c. Current Zoning: R1 d. Parcel was purchased using Low and Moderate Income Housing Asset Fund - 20% Set Aside e. Previous Use: Purchased from Cal Trans. It was a remnant parcel from the freeway widening project. The site was vacant and undeveloped at the time it was acquired. (2) 801, 809 & 809 % E. Santa Ana Blvd a. APN: 398-303-04 / 398-303-05 / 398-303-06 / 398-303-07 b. Lot Size: 15,OOOsf c. Current Zoning: SD84 d. Parcel was purchased using Low and Moderate Income Housing Asset Fund - 20% Set Aside (801, 807, 809 & 809'/2). Includes 807 E. Santa Ana Blvd. e. Previous Use: L 801 — Demolished single family dwelling in 2011. fl. 807 — Acquired through a foreclosure action. Demolished single family dwelling and detached garage in 2000. iii. 809 & 809 1/2 — Acquisition through Fannie Mae in 1998. Demolished two single-family dwellings in 1999. (3) 826 N Lacy / 830 N Lacy a. APN: 398-041-22 / 398-041-18 b. Lot Size: 8,843sf / 7,405sf c. Current Zoning: SD19 d. Parcel was purchased using Low and Moderate Income Housing Asset Fund - 20% Set Aside (both parcels) e. Previous Use: 830 was formerly 416 E. Vance Street. Demolished a six -unit apartment building and garage in 1995. (4) 1126 & 1146 E. Washington Ave. a. APN: 398-092-14 b. Lot Size: 62,347sf (1.43 Acres) c. Current Zoning: SD -84 d. Parcel was purchased using Low and Moderate Income Housing Asset Fund - 20% Set Aside e. Previous Use: i. Purchased from Cal Trans. Remnant parcel from freeway widening project. Cal Trans demolished five buildings on the site in the early 1990s. The site was vacant and undeveloped when it was acquired by the City. 19C-9 07 a A x a s m C $ AVENUE $ r" 4 r'- SANTA �— CLARA O N O C & a00a o s n n x Qr)M p O y m �. Y m Ism ❑ G !o• o manN p N < lrn' Q N � O n C/) 0 ® N p6 8 6 44 BUFFALO AVENUE &UI ALO +.ww C A AVE. OD �'a VI MM' Pu 6 O © 6 T. 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Santiago St RFP Issued for HOME/CDBG Funds May -13 Awarded HOME/CDBG Funds Jun -14 Planning Entitlements Approved Oct -14 RFQ Issued for PBVs Apr -15 Submitted Application for AHSC (Cap &Trade Funds) May -15 Awarded PBVs Jun -15 Awarded AHSC (Cap & Trade) Funds Sep -15 9% Tax Credits Awarded Nov -15 Relocation Plan Approved May -16 Building Permits Pulled/Construction Initiated Mar -18 Construction Completion Apr -18 Tenants Anticipated Move -In Oct -15 The Orchard - 2153 E. first St Conditional Use Permit Approved Dec -15 RFP Issued for PBVs Feb -16 RFP Issued for HOME Funds Mar -16 Awarded PBVs Jun -16 Awarded HOME Funds Jul -16 4% Federal Tax Credit +Tax Exempt Bond Awarded Sep -16 Building Permits Pulled/Construction Initiated Jan -18 Construction Completion Jun -15 Santa Ana Arts Collective -1666 N. Main St RFP Issued Nov -15 Approved HOME/CDBG Funds Mar -16 Submitted Application for AHSC (Cap & Trade Funds) Sep -16 Awarded AHSC (Cap & Trade) Funds Nov -16 9% Tax Credits Awarded Dec -16 Relocation Plan Approved Jul -17 Final Loan Approved/ Close of Escrow Jul -17 Planning Entitlements Approved Jul -17 Building Permits Pulled/Construction Initiated Apr -19 Anticipated Construction Completion 19C-1 5 EXHIBIT 3 Tiny Tim Plaza - 2223 W. 5th St Dec -16 Developer Submitted Request for Funds to CDA First Street Apartments -1440 E. first St Oct -15 Developer Submitted Request for Funds to CDA Apr -16 Planning Entitlements Approved Jun -17 Awarded Successor Agency Funds Jun -17 Relocation Plan Approved Sep -17 9% Tax Credits Awarded Jan -18 Final Housing Authority Loan Approved Mar -18 Close of Escrow Tiny Tim Plaza - 2223 W. 5th St Dec -16 Developer Submitted Request for Funds to CDA Santa Ana Veterans Village - 3312 W. First St Dec -16 RFP Issued for PBVs Apr -17 Approved HUD VASH PBVs Jun -17 Awarded HOME CHDO Funds Jun -17 Planning Entitlements Approved Jan -18 Awarded County Special Needs Housing Funds Feb -18 Submittal of 9% Federal Tax Credit Application Jun -18 Anticipated Award of 9% Federal Tax Credits Tiny Tim Plaza - 2223 W. 5th St Dec -16 Developer Submitted Request for Funds to CDA Aqua Housing - 317 E. 17th St Dec -16 RFP Issued for PBVs Apr -17 Approved PBVs Jun -17 Planning Entitlements Approved Jun -17 Approved Additional PBVs Jan -18 Awarded County Special Needs Housing Funds Jan -18 Submitted Application for HCD Infill Infrastructure Funds Feb -18 Submittal of 9% Federal Tax Credit Application May -18 Anticipated Award of HCD Infill Infrastructure Funds Jun -18 Anticipated Award of 9% Federal Tax Credits Tiny Tim Plaza - 2223 W. 5th St Dec -16 Developer Submitted Request for Funds to CDA Jun -17 Awarded City and Successor Agency Funds Jan -18 Planning Entitlements Approved Jan -18 Submitted Application for AHSC (Cap & Trade Funds) Jan -18 Submitted Application for HCD Infill Infrastructure Funds Mar -18 Developer is securing additional financing prior to submittal of Federal Tax Credit Application May -18 Anticipated Award of HCD Infill Infrastructure Funds Jun -18 Anticipated Award of AHSC (Cap & Trade Funds) 19C-16 EXHIBIT 3