Transcript Affordable Housing (Obligating the 2010 Housing Bond Proceeds)

STUDY SESSION
Affordable Housing
(Obligating the 2010 Housing Bond Proceeds)
City Council of the City of Fullerton
and the
Housing Successor Agency
October 2, 2012
Affordable Housing
• What makes housing “affordable” is the
ratio of housing costs to household
income. The generally accepted definition
of affordability means that housing plus
utilities should not cost more than 30
percent of household income.
Affordable Housing
• Fullerton’s involvement in providing affordable
housing is directly related to obligations defined in
Redevelopment Law (and further emphasized by a
stipulated judgment)
• The regional planning authority, Southern California
Association of Governments (SCAG), through the
Regional Housing Needs assessment (RHNA), tells
us what our share of the regional need is for new
units.
• This is the sixth study session on affordable housing
held since 2007.
• Prior study sessions explored specific affordable
housing policies.
• This study session includes examination of eligible
activities for the 2010 Housing Bond.
Key Topics
• Existing Affordable Housing Projects
• Requirements Impacting Affordable
Housing Funds
• Recent Legislative Actions Impacting
Affordable Housing
• Affordable Housing Sources in the PostRedevelopment Era
• Use of the 2010 Housing Bond Funds
Existing Affordable Housing
Projects
• The City and former Redevelopment Agency (RDA)
have assisted in the development and/or
rehabilitation of approximately 535 units since 1992.
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20 units for extremely low income
390 units for very low income
15 units for low income
34 units for moderate income
76 units not restricted by City but are restricted by Tax
Credit Allocation Committee
• Of this 535 unit total, 59 units are specifically
restricted for senior housing.
Existing requirements impacting
Affordable Housing Funds
• Health and Safety Code (former sections
of the Community Redevelopment Law
that still apply)
• Stipulated Judgment
• Regional Housing Needs Assessment
(RHNA)
Recent Legislative actions
impacting Affordable Housing
Assembly Bill X1 26
• June 28, 2011 - Governor Brown signed the FY
2011-12 State Budget including a budget trailer
bill, AB X1 26, that immediately suspends all
new redevelopment activities.
• August 2011 - the California Redevelopment
Association and the League of California Cities
filed lawsuit against the State alledging AB X1
26 as unconstitutional.
• December 29, 2011 - California Supreme Court
ruled on AB X1 26 included provisions to
dissolve redevelopment agencies by February 1,
2012.
City’s Housing Functions
• Pursuant to AB X1 26 and Health & Safety Code
Section 34173, the City of Fullerton approved
Resolution No. 2012-07 electing to serve as the
Housing Successor Agency to the Fullerton
Redevelopment Agency. This action retains the
housing assets and functions of the former
Fullerton Redevelopment Agency including all
rights, powers, duties, and obligations, excluding
any amounts on deposit in the Low and
Moderate Income Fund.
Assembly Bill 1484
• On June 27, 2012, the State Legislature
passed AB 1484, the primary purpose of
which is to make technical and substantive
amendments to AB X1 26.
• Pursuant to AB 1484, all bond proceeds
derived from bonds issued on or before
December 31, 2010, shall be used for the
purposes for which the bonds were sold
(providing affordable housing units).
Assembly Bill 1484
• AB 1484 also requires that prior to moving
forward with housing activities, projects, and
programs, the City must complete the following:
– preparing a list of housing assets that will need to be
submitted and approved by the Department of
Finance (DOF);
– conducting a Due Diligence Review audit of the Low
and Moderate Income Housing Fund;
– receive approval of the Due Diligence Review audit
from the Oversight Board and DOF;
– receive approval from the DOF on the Recognized
Obligation Payment Schedule No. 3.
Next Steps – AB 1484
• The City’s Housing Successor Agency is
currently unable to proceed with affordable
housing projects and programs until the
requirements of AB 1484 are completed.
• Key dates include:
– August 1, 2O12 – list of housing assets completed
and submitted to and approved by the DOF
– October 1, 2012 – Due Diligence Review audit is
completed for the Low and Moderate Income Housing
Fund
– October 17, 2012 – Oversight Board considers
approval of Due Diligence Review audit
– October 19, 2012 – DOF notifies Successor Agency
of Recognized Obligation Payment Schedule No. 3
results
Affordable Housing Fund
sources in the postredevelopment era
Existing Housing Funds Sources
• Federal - Community Development Block
Grant (CDBG) Fund Program
• Federal - Home Investment Partnerships
Program (HOME)
• Federal/State - Down Payment Assistance
(DAP) loan repayment
• State - 2010 Housing Bond Proceeds
CDBG Grant Fund Program
• $1,272,142 million received in FY 2012-13
• Assistance to Low Income and below
• Cannot be used for construction of new
housing
• Can be used for residential rehabilitation
HOME Program
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$407,059 received for FY 2012-13
Assistance to Low Income and below
Affordability covenants up to 15 years
Eligible Activities:
– First-time Homebuyer Assistance
– Tenant-based Rental Assistance
– Site Acquisition
– Rehabilitation or New Construction
Downpayment Assistance Program (DAP)
• Began in 1993, DAP was formed to assist firsttime homebuyers in the purchase of a residential
units located throughout Fullerton.
• A total of 212 loans have been issued.
• Funded by Set-Aside Funds ($7.52 million; 174
loans) & HOME funds ($1.65 million; 38 loans);
HOME participation began in 1997
• DAP program terminated in 2004 due to rise in
housing costs. Approximately $200,000 in
repayments received in 2011.
2010 Housing Bond
• City Council during the January 29, 2008 Housing Study
Session directed staff to explore the issuance of a
housing bond.
• City Council approved 2010 Taxable Tax Allocation
Housing Bond issuance on October 5, 2010
• Official Issue Date: October 21, 2010
• Bond issue amount: $28,980,000
• Bond stipulated proceeds to be used to provide financing
of affordable housing projects in the City of Fullerton.
• Annual debt service payment: approximately $ 2.8
million
• Maturity Date: September 2026
2011 Notice of Funding Availability (NOFA)
• January 8, 2008 – Agency provided direction to pursue
development of Low and Very Low-Income Projects
(priority under RHNA allocation) and pursue selection of
development partners
• October 5, 2010 – Agency approves the draft Notice of
Funding Availability
• January 14, 2011 – Staff transmits NOFA to all prequalified affordable housing developers.
• April 7, 2011 - NOFA Selection Committee holds meeting
to hear developer presentations and score all proposals
received.
• August 16, 2011 – City Council makes recommendations
and selects four (4) proposals to begin negotiations with
staff on Affordable Housing Agreements
2011 NOFA Projects Selected
• Pathways to Hope (formerly Fullerton Interfaith Emergency
Services)/HomeAid – proposal consisted of the development of 8
transitional living units located at 500 block of E. Amerige Avenue.
Amount requested: $640,000.
• St. Anton Partners – the SOCO Santa Fe proposal consisted of the
development of 152 units located along 200 block of West Santa Fe
Avenue. 90% of units will be available to low income families and
10% to very low income families. Amount requested: $11,500,000.
• Richman Group – The Alexander proposal consisted of the
development of 95 senior units located at 345 East Commonwealth
Avenue. 90% of units will be available to low income seniors and
10% to very low income seniors. Amount requested: $9,215,000.
• Squire Properties – recommended by Council to begin negotiations
if there were funds available; the Pacific Hawaiian proposal
consisted of the development of 55 units in the FTC Specific Plan
area (336 E. Santa Fe). Amount requested: $11,350,000.
NOFA Process – Next Steps
• Three (3) of the development proposals (St.
Anton Partners, Richman Group, Pathways to
Hope/HomeAid) were in the process of
negotiating affordable housing agreements with
staff. However, State legislation related to
redevelopment dissolution put the process on
hold.
• Staff, pending direction by the City Council, will
continue to work and negotiate with the selected
developers to resolve any outstanding business
terms.
• If the City Council chooses to re-evaluate the
NOFA process, the Council will need to agendize
this action at a future Council meeting.
Use of the 2010 Housing
Bond Funds
Eligible Activities for 2010 Housing Bond
• New Construction - Rental Development Projects
• New Construction - Ownership Development
Projects
• Multi-Family/Single-Family Rehabilitation projects
• Property Acquisition and Development (i.e.,
continue acquisition and subsequent development
of Richman Park area)
• Development of a transitional living units
• Senior Housing
• First-Time Homebuyer program
• Maintain the community’s supply of mobilehomes
QUESTIONS ???