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Pre-Commitment of $920,000 in Affordable Housing Funds for Habitat for Humanity of <br />Orange County <br />July 1, 2025 <br />Page 4 <br />5 <br />1 <br />5 <br />7 <br />to households with income that does not exceed the limits for Low and Moderate- <br />Income Households for an affordable sales price that complies with the limits for an <br />"affordable housing cost," as defined in California Health and Safety Code §50052.5. <br />The affordable housing covenant will run with the land for a period of forty-five (45) <br />years. <br />This pre-commitment letter shall not obligate the City or any department thereof to <br />approve any application or request for, or take any other action in connection with, any <br />planning approval, permit, or other action necessary for the construction, rehabilitation, <br />installation, or operation of the project. The pre-commitment letter will also be <br />conditional on Habitat for Humanity obtaining approval of all required entitlements and <br />discretionary actions to allow the construction, improvement, conversion, and/or <br />development of nine (9) affordable ownership units at 425 E. Wellington Avenue. <br />In compliance with the City’s Affordable Housing Funds Policies and Procedures, KMA <br />completed a preliminary financial gap analysis for this project (Exhibit 3). Following this <br />analysis and completion of the procurement process, KMA confirmed the preliminary <br />financial gap and need for the Review Panel’s recommendation to award up to <br />$920,000 in Inclusionary Housing Funds. This second project’s economics are <br />described in detail in KMA’s analysis attached as Exhibit 3 to this report. <br /> <br />ENVIRONMENTAL IMPACT <br />There is no environmental impact associated with this action because the <br />recommended action consists of a pre-commitment of funds. <br />FISCAL IMPACT <br />For 425 E. Wellington Avenue, the MOU is estimated to be finalized for City Council <br />approval in FY 25-26. Upon future approval of the MOU, funds will be budgeted and <br />available as shown below: <br />Fiscal <br />Year <br />Accounting Unit <br />– Account # <br />Fund <br />Description <br />Accounting Unit, <br />Account <br />Description <br />Amount <br />FY 25-26 41718820-69152 Inclusionary <br />Housing Fund Loans and Grants $920,000 <br />Total $920,000 <br />EXHIBITS <br />1.Staff Report from October 17, 2023 <br />2. Pre-Commitment Letter for 425 E. Wellington Avenue <br />3. Preliminary Financial Gap Analysis for 425 E. Wellington Avenue <br />  <br />  <br />City Council 9 – 4 7/1/2025