AFFORDABLE HOUSING INFORMATION WORKSHOP. City of Encinitas Housing Authority October 10, 2018

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1 AFFORDABLE HOUSING INFORMATION WORKSHOP City f Encinitas Husing Authrity Octber 10, 2018

2 PURPOSE & OUTLINE Staff t prvide verview f affrdable husing in Encinitas Describe affrdable husing funding prgrams Shwcase recent affrdable husing cmmunities Panel discussin/q&a discussin Receive feedback and directin Cantebria Senir Apartments 2

3 WHAT IS AFFORDABLE HOUSING? Affrdable Husing 30% f mnthly incme twards husing Deed-Restricted Area Median Incme (AMI) fr San Dieg Cunty Department f Husing and Urban Develpment Califrnia Health and Safety Cde Cral Cve 3

4 LOW INCOME DEFINED Area Median Incme % 2018 Incme Limit (4 persn) 2018 Rent Limit (2bd) Extremely Lw 30% $29,200 $552 Very Lw 50% $48,650 $920 Lw 80% $77,850 $1,104 Mderate 120% $98,150 $2, San Dieg Median Incme: $81,000 Nte: Incme/Rents vary based n prgram and changes annually 4

5 AFFORDABLE HOUSING NEEDS IN ENCINITAS 38.5% f husehlds have incmes less than $75,000 (ACS ) 1% f husing stck deed restricted at 80% AMI r belw (SANDAG and City f Encinitas) Median Sales Price $1,165,900 (HmeDex) Median Rent $3,544 (Zillw) Manchester Apartments Plicy questin t cnsider: Shuld a deed restricted gal (%) be established? 5

6 AFFORDABLE HOUSING IN ENCINITAS Deed Restricted Apartment Units 136 Accessry Units 101 Single-Family/Cnds 65 TOTAL 302 Pacific Encinitas 6

7 The Bathuses Su Casa Apartments Esperanza Gardens Iris Apartments Pacific Pines Pacific Statin 7

8 OTHER HOUSING PROGRAMS Nn-Deed Restricted Prgram Funding Husehlds Assisted Sectin 8 Rental Assistance Residential Rehabilitatin Prgram Opening Drs Encinitas - General Funds Dwn Payment Assistance Federal HUD Apprx. 100 Federal HUD 110 since 2008 Federal HUD Nne Administering Entity City f Encinitas Husing Authrity City f Encinitas Develpment Services 80 Since 2016 Cmmunity Resurce Center Cunty f San Dieg 8

9 AFFORDABLE HOUSING FUNDING FEDERAL COUNTY: Sectin 8 Prject Based Vuchers HOME Funding Mental Health Services Act HUD 202 Prgram Funding Many Mre Husing Trust Fund STATE: CITY: Tax Credits CDBG Funding (acquisitin, Affrdable Husing & rehab, site clearance) Sustainable Cmmunities Affrdable Husing Funds Veterans Husing Prgram Many Mre 9

10 WHAT ARE TAX CREDITS? Tax Refrm Act f 1986 t encurage public/private partnerships t develp affrdable husing Gverned by Sectin 42 f the IRS Cde Knwn as Lw-incme Husing Tax Credit (LIHTC) Administered by each State Califrnia Tax Credit Allcatin Cmmittee (TCAC) Highly cmpetitive prgram Twice per year funding 10

11 HOW DO TAX CREDITS WORK? Tax Credits are a dllar fr dllar reductin in federal incme tax liability Tw types f Tax Credits, 9% and 4% Credits: 9% and 4% refer t the apprximate % f a prjects qualified basis a taxpayer may deduct frm their annual federal tax liability fr ten years Affrdable husing develpers awarded with Tax Credits partner with an equity investr wh purchases the credits in rder t ffset their tax liability Develpers use equity prvided by investrs t acquire, cnstruct, and/r rehabilitate affrdable husing 11

12 TAX CREDITS (CONT.) Capital r equity received frm the sale f Tax Credits reduces the amunt f debt r lans needed t cver the cst f cnstructin Remaining amunt f funding needed t fill the gap in financing f affrdable husing cmes frm lcal jurisdictins and/r ther surces 13

13 GAP FINANCING The City funds Gap via Residual Receipts lans Lw interest lan fr the term f the deed restrictins (usually 55 years) Paid ff frm Residual Receipts and refinancing f the prject Residual Receipts = Cash flw at end f fiscal year after all allwable prject perating expenses, debt service, etc. have been met 14

14 PUBLIC/PRIVATE PARTNERSHIP Partner w/flks wh really have it dwn RECENT AFFORDABLE HOUSING COMMUNITIES 15

15 LAS PALMAS: SAN CLEMENTE, CA Natinal Cmmunity Renaissance (CORE) 19 ne-bedrm units 30%-60% AMI Cmmunity rm Mixed-use/ R24 zne 52 net units/acre 2-3 stries; 30 feet Funding 4% Tax Credits $3,158,265 City f San Clemente Lan $3,430,000 State Grant $731,000 Develper Lan $400, year Mrtgage $432,000 Ttal $8,151,265 16

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19 OAKCREST HEIGHTS: YORBA LINDA, CA Natinal Cmmunity Renaissance (CORE) (Ranch Cucamnga, CA) 54 units Families 30%-60% AMI Preschl nsite Cmmunity center and services Vter apprved R30 sites 17 net units/acre 3 stries; 30 feet Funding 9 % Tax Credits $15,430,624 City f Yrba Linda Lan $5,234,803 Other Lans $4,143,094 Develper Equity $100,000 Ttal $24,881,521 20

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23 CREEKSIDE: SAN MARCOS, CA Opprtune Cmpanies (Encinitas, CA) 98 units Families 30% - 60% AMI Mixed-use: 26,500 sq. ft. retail New street + numerus infrastructure imprvements Cmmunity amenities and services LEED Silver r equivalent Mixed-use/R30 zne 29 net units/acre 2-4 stries; up t 60 feet Funding 9% Tax Credits $22,279,806 City f San Marcs Lan $12,281,000 Ttal $34,560,806 24

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27 PARKVIEW: SAN MARCOS, CA Hitzke Develpment (Lemn Grve, CA) & C & C Develpment (Tustin, CA) 84 units Families at r belw 60% AMI Mixed Use - 4,000 sq. ft. retail Cmmunity amenities and services LEED Silver r equivalent Mixed-use/R30 zne 20.9 net units/acre 2-3 stries; up t 35 feet Funding 9% Tax Credits $17,026,867 City f San Marcs Lan Cnventinal Mrtgage $11,681,583 $1,106,430 HMSA $1,637,804 Deferred Fees $274,826 Ttal $31,700,510 28

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31 WINDSOR POINTE: CARLSBAD, CA (PLANNED DEVELOPMENT) Affirmed Husing (San Dieg, CA) 50 units; ver tw sites Hmeless veterans/families 30% - 60% AMI R30 zne 51.2 net units/acre 3 stries; 35 feet Awaiting Funding Funding (anticipated) Tax Credits $15,400,000 City f Carlsbad Lan $4,250,000 Affrdable Husing Prgram $480,000 Other $4,750,000 Ttal $24,880,000 32

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36 Q&A/PANEL DISCUSSION 37

37 NEXT STEPS Develp plicies, guidelines, deal pint standards, and incentives Late 2018/Early 2019: Wrkshp and review f draft dcuments Spring 2019: City Cuncil Cnsideratin 38

38 THANK YOU! CONTACTS Nicle Pian-Jnes: Temprary Husing Crdinatr, City f Encinitas -- npian@encinitasca.gv Karl Schwarm: Cntract Emplyee -- kshwarm13@gmail.gv Ginger Hitzke: President, Hitzke Develpment -- ginger@hitzkedevelpment.cm Steve Bram: Principal/CEO, Opprtune Cmpanies -- steve@pprtunec.cm Jhn Seymur: Vice President f Acquisitin & Frward Planning, Natinal Cre -- jseymur@natinalcre.rg Nicki Cmeta: Chief Financial Officer, Affirmed Husing -- nicki@affirmedhusing.cm 39