Submitted by: Kristen Lee, Acting Secretary, Housing Advisory Commission

Transcription

1 Housing Advisory Commission To: From: Honorable Mayor and Members of the City Council Housing Advisory Commission Submitted by: Kristen Lee, Acting Secretary, Housing Advisory Commission Subject: RECOMMENDATION Approve fund reservations from the Housing Trust Fund account to Affordable Housing Associates (AHA) in the amount of $400,000 for the development of Harmon Gardens and to Resources for Community Development (RCD) in the amount of $90,259 for physical upgrades to Regent House. FISCAL IMPACTS OF RECOMMENDATION The Housing Trust Fund currently has a total amount of $2,996,661, consisting of $2,327,959 in HOME funds, $593,030 in CDBG funds, and $75,672 in General Funds, available for commitment to affordable housing projects. Of this total, the following commitments have been recommended: $400,000 for RCD to renovate Erna. P. Harris. This recommendation is on this agenda for Council approval. $700,000 for the Berkeley Housing Authority s to renovate the public housing units. At its meeting of June 23, 2009 as part of the budget adoption process, Council approved this set-aside of HTFs. This item recommends allocating $490,259 $400,000 to AHA to develop housing for transition-age youth aging out of foster care, and $90,259 to RCD for repairs and upgrades to Regent House. The approval of all these recommendations would leave $1,381,450 remaining in the HTF. CURRENT SITUATION AND ITS EFFECTS At its April 2, 2009 meeting, the HAC approved the establishment of a pipeline of projects for future funding. At that same meeting, the HAC also approved setting aside 25% of the HTF for distribution through an expedited Open Application process, as provided for in the Guidelines. The purpose of the Open Application process was to 2180 Milvia Street, Berkeley, CA Tel: (510) TDD: (510) Fax: (510) manager@cityofberkeley.info Website:

2 provide an expedited review of projects trying to meet the June 9, 2009 application deadline set by the Tax Credit Allocation Committee for federal and state low income housing tax credits and federal stimulus exchange funding. Eligible projects accepted during the Open Application Set-Aside period were limited to those projects that had already secured commitments of all other major funding or that needed City funding in order to secure other public funding commitments, such as tax credits. The amount was limited to 25% of the available HTF account as required by the current HTF Guidelines. BACKGROUND The Housing Department published a Request for Proposals (RFP) on May 8, 2009 and received the following requests for funding allocations: $1,381,450 from City Centric, Inc., for the development of 97 units of senior housing at 1200 Ashby Avenue. $400,000 from Affordable Housing Associates, for the development of 15 units of housing for homeless or at-risk of homeless youth aging out of foster care at 3240 Sacramento Street $90,259 from Resources for Community Development for roof, electrical and dry rot repairs to a group home for 6 formerly homeless persons living with HIV/AIDS at 2511 Regent Street. The expedited application review process called for two HAC meetings. At the first meeting, a special meeting held on June 13, 2009, the HAC held a public hearing to receive comments from the public regarding the three applications. Fourteen members of the public spoke: six in favor of the Harmon Gardens Project; three in favor of the Regent House project, and; four against and one in favor of the Ashby Arts project. The public hearing was followed by a special meeting of the HAC, joined by Gene Turitz and Paul Church of the City Manager s Housing Advisory Task Force, to review and discuss the applications. After an extended discussion during which HAC members asked questions of both Housing staff and the project applicants, the HAC ranked the projects in order of priority as follows: 1) Regent House, 2) Harmon Gardens, and 3) Ashby Arts. HAC members deferred making formal recommendations on funding reservations to their regular July meeting. At the July 9, 2009 HAC meeting, there were no speakers on any of the HTF applications. However, Council member Worthington spoke during public comment and suggested that the HAC recommend that Council allocate additional non-htf revenues to the HTF for possible allocation to the Ashby Arts project or other affordable housing projects. The HAC entertained the following three motions at that meeting.

3 To recommend that City Council approve HTF funding reservations in the amount of $90,259 for Regent House and $400,000 for Harmon Gardens. (M/S/C: Levenson/Sawicki. Unanimous) To recommend that City Council consider funding the Ashby Arts Senior Housing project with funds from other sources besides the HTF, provided that the project include adequate funding for a substantial social services component. (Motion failed. Kwon/Calfee: Ayes: Sawicki, Kwon, Calfee. Noes: Coulter, Levenson, Wolfe. Abstentions: Dunner, Viveros-Banderas) To recommend that the City Council identify additional resources for the Housing Trust Fund to be made available to all projects in the pipeline for HTF funding, including the Ashby Arts Senior Housing project. (Motion failed: Levenson/Kwon. Ayes: Kwon, Sawicki, Calfee, Levenson. Noes, Coulter, Wolfe. Abstentions: Dunner, Viveros-Banderas) RATIONALE FOR RECOMMENDATION The HAC expressed strong support for both Regent House and Harmon Gardens at their meetings on June 13 th and July 9 th. Both projects serve special needs populations, which the HAC has established as a priority. Regent House serves formerly homeless persons living with HIV/AIDS in a 6-unit single room occupancy house on Regent Street. The project receives rental subsidies from the HUD--Supportive Housing Program (SHP). However, these funds may not be used to create a capital replacement or maintenance reserve. The request is for $90,259 which is to be used to replace the roof, repair dry rot, bring the electrical system up to code, replace the existing decking and fence, repair and replace flooring, cabinets and countertops. The HAC felt that this was a relatively small investment to extend the life of the property. There was considerable community support expressed for this project at the June 13 th meeting. Harmon Gardens includes the demolition of an existing structure and the construction of 16 new units, of which 15 will be studios for transition-age youth aging out of foster care who are either homeless or at risk of being homeless and one will house an on-site property manager. AHA will partner with Fred Finch, a social services provider with a great deal of experience assisting transition aged youth. The project will provide supportive services for all the residents, including those with mental health issues. Though the HAC was concerned about the per unit cost of this project, it was very supportive because the project serves a priority population. Additionally, there was considerable community support expressed for this project at the June 13 th meeting. The HAC does not recommend funding for the Ashby Arts project at this time for a number of reasons. The applicant requested almost $1.4 million, almost half of the

4 money available for all projects this funding year. HAC members questioned the commitment of such a large amount of money to another senior project since three out of five of the most recent new affordable developments have served seniors. The HAC had several concerns about the potential success of this project. A major concern related to the suitability of the location for seniors since it is at the intersection of two major traffic arterials and is in an area that is not pedestrian friendly. Further, the Commission was concerned that the social services plan for the project was not fully developed and was inadequately funded to serve a building of this size. The HAC was also concerned that there are other projects in need of funding this year and funding Ashby Arts would completely deplete the HTF leaving the City unable to assist other worthy projects. ALTERNATIVE ACTIONS CONSIDERED In response to Councilmember Worthington s request, The HAC did not recommend that the City Council identify non-htf funding for the Ashby Arts development. CITY MANAGER See separate report. CONTACT PERSON Jane Coulter, Chair, Housing Advisory Commission Kristen Lee, Community Services Specialist, Housing Department,

5 RESOLUTION NO. ##,###-N.S. APPROVAL OF FUND RESERVATIONS FROM THE HOUSING TRUST FUND FOR REGENT HOUSE AND HARMON GARDENS WHEREAS, the City Council established a Housing Trust Fund Program to assist in the development and expansion of housing affordable to low income persons who either work or reside in Berkeley, and authorized the City Manager to implement the Program; and WHEREAS, there is a great need for affordable and special needs housing in the City of Berkeley as stated in the General Plan Housing Element and the City of Berkeley s Consolidated Plan; and WHEREAS, the Housing Advisory Committee wished to set up an expedited review process for awarding fund reservations from the HTF in order to allow projects to apply for the single 2009 round of low income tax credits and to apply for funding made available as a result of the American Recovery and Reinvestment Act of 2009; and WHEREAS, the expedited review process requires the City Council to approve a waiver of the approved HTF program guidelines in order to approve fund reservations; and WHEREAS, the City of Berkeley desires to assist Affordable Housing Associates in converting its Harmon Gardens site to a supportive housing development for transition age youth aging out of foster care and also desires to assist Resources for Community Development in providing physical upgrades to its facility for formerly homeless persons living with HIV/AIDS at Regent House. NOW THEREFORE, BE IT RESOLVED by the Council of the City of Berkeley that it waives the HTF guideline requirements to allow an expedited review of funding applications in order to meet the deadlines for the 2009 California Low Income Housing Tax Credit funding round; and BE IT FURTHER RESOLVED that the Council of the City of Berkeley approves an additional fund reservation from the HTF in the amount of $400,000 to Affordable Housing Associates for the purpose of converting Harmon Gardens to a supportive housing project for transition age youth aging out of foster care provided that the federal environmental review requirements are met. BE IT FURTHER RESOLVED that the Council of the City of Berkeley approves a fund reservation from the HTF in the amount of $90,259 to Resources for Community Development for the purpose of providing physical upgrades to Regent House provided that the federal environmental review requirements are met. BE IT FURTHER RESOLVED, that the City Manager, or his designee, is authorized to amend the terms of the City of Berkeley s existing Development Loan Agreement with

6 Affordable Housing Associates for Harmon Gardens to increase the amount of the existing loan in the amount of $400,000, to lower the interest rate to 3%, to extend the loan term to 55 years, and to change the scope of work to allow the site to be converted to a supportive housing development in keeping with the provisions of this resolution. BE IT FURTHER RESOLVED that the HTF funding reservation for Harmon Gardens is contingent on receipt of an allocation of Low Income Housing Tax Credits from the California Tax Credit Allocation Committee (CTCAC) no later than October 30, BE IT FURTHER RESOLVED that if CTCAC fails to allocate Low Income Housing Tax Credits by October 30, 2009 to Harmon Gardens, the HTF fund reservation authorized by this resolution shall be cancelled as of October 30, BE IT FURTHER RESOLVED that the City Manager, or his designee, is authorized to enter into a Development Loan Agreement with Resources for Community Development for Regent House in the amount of $90,259 for a term of 55 years at 3% interest.