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HomeMy WebLinkAbout29C - AMENDMENTS ADD FORECLOSED HOMESREQUEST FOR COUNCIL ACTION CITY COUNCIL MEETING DATE: MAY 7, 2012 TITLE: SUBSTANTIAL AMENDMENTS TO THE 2010-2011 AND 2011-2012 ANNUAL ACTION PLANS ADDING THE FORECLOSED HOMES ACQUISITION PROGRAM AND AMENDMENT TO CONTRACT WITH ANR SANTA NSP, LLC CITY MANAGER RECOMMENDED ACTION Recommend that the City Council: CLERK OF COUNCIL USE ONLY: APPROVED ? As Recommended ? As Amended ? Ordinance on 1s` Reading ? Ordinance on 2nd Reading ? Implementing Resolution ? Set Public Hearing For CONTINUED TO FILE NUMBER 1. Approve the Foreclosed Homes Acquisition Program and authorize the Executive Director of the Community Development Agency to execute all necessary documents. 2. Approve a substantial amendment to the 2010-2011 Annual Action Plan approving the use of HOME funds for the Foreclosed Homes Acquisition Program and authorize its submittal to the U. S. Department of Housing and Urban Development. 3. Approve a substantial amendment to the 2011-2012 Annual Action Plan approving the use of HOME and CDBG funds for the Foreclosed Homes Acquisition Program and authorize its submittal to the U. S. Department of Housing and Urban Development. 4. Authorize the City Manager and the Clerk of the Council to execute the attached amendment to the NSP2 Program Grant Services Agreement with ANR Santa Ana NSP, LLC in an amount not to exceeed $5 million plus program income, subject to nonsubstantive changes approved by the City Manager and City Attorney. COMMUNITY REDEVELOPMENT AND HOUSING COMMISSION ACTION At its regular meeting on April 3, 2012, by a vote of 6:0 (Bist absent), the Community Redevelopment and Housing Commission approved the recommended actions. 29C-1 2010-2011 and 2011-2012 Annual Action Plan Substantial Amendments and ANR Agreement Amendment May 7, 2012 Page 2 DISCUSSION Since 2009, the City of Santa Ana has applied for and received more than $17 million in federal Neighborhood Stabilization Program (NSP) grant funds through three different applications. The purpose of NSP is to help preserve neighborhoods by eliminating the blight associated with the foreclosure and abandonment of residential properties. As of March 1, 2012, the City has successfully utilized the NSP funds to facilitate acquisition, rehabilitation and resale of 53 single- family homes and condominiums and has provided seven down payment assistance loans. Additionally, funds were provided to also facilitate the purchase of a foreclosed vacant lot on which a new 36 unit apartment building is being constructed, and the acquisition of two foreclosed multifamily buildings with a total of 40 units. As part of the application and the award of NSP2 funds, a minimum production goal of 100 units was required. Due to higher unforeseen acquisition and rehabilitation costs, additional funds will be required for the City to achieve that goal. The proposed Foreclosed Homes Acquisition Program (Exhibit 1) has been designed to augment the current NSP efforts and will ensure achievement of the 100 unit goal. The program will be operated in the Target Geography Area established for the NSP2 grant. This new program will be operated in accordance with existing NSP2 guidelines. The only exception from NSP requirements relates to household incomes and resale restrictions. Resale of homes purchased through the new program will be restricted to households with incomes at or below 80% of the area median (AMI) as determined by the U. S. Department of Housing and Urban Development. Current NSP programs allow up to 120% AMI. As of December 1, 2011, maximum household incomes as adjusted for household size were as follows: Household Size Income Level Household Size Income Level One $53,950 Five $83,250 Two $61,650 Six $89,400 Three $69,350 Seven $95,550 Four $77,050 Eight $101,750 Maximum sales prices will be restricted to ensure affordability to such households. As of December 1, 2011, those prices were as follows: One Bedrm Two Bedrm Three Bedrm Four Bedrm Five Bedrm Household Size 2 Persons 3 Persons 4 Persons Five Persons Six Persons Low $164,200 $184,000 $199,300 $213,400 $228,100 Finally, to the extent participating households want to sell their homes, they will be required to resell them to other low income families at an affordable sale price. This resale restriction will remain for a period of fifteen years after the transfer of title to the purchasing family. 29C-2 2010-2011 and 2011-2012 Annual Action Plan Substantial Amendments and ANR Agreement Amendment May 7, 2012 Page 3 In order to fund the Foreclosed Homes Acquisition Program for the remainder of the 2011-2012 fiscal year, the City must adopt Substantial Amendments to its 2010-2011 (Exhibit 2) and 2011- 2012 (Exhibit 3) Annual Action Plans. Under the proposed Substantial Amendments, $3.6 million in HOME funds and $1 million in CDBG residential loan repayment funds will be reprogrammed for support of the acquisition, rehabilitation and resale of foreclosed and abandoned single-family homes in the NSP2 target area to qualified low income households. On March 1, 2010, the City Council approved a contract with ANR Industries to assist the City with implementation of the single-family components of the NSP2 Program. The amendment to this contract would authorize ANR to use HOME and CDBG funds in an amount up to $5 million plus program income for the new Foreclosed Homes Acquisition Program (Exhibit 4). This amount includes both the current proposed reallocations of HOME and CDBG funds and funds from the 2012-2013 HOME allocation. Finally, the 2011-2012 Action Plan budgeted $890,000 for the purchase of fire equipment to be housed in a fire station that serves a CDBG eligible area. The funds will be reprogrammed for improvements to fire stations in CDBG eligible areas in Santa Ana. The attached 2011-2012 Substantial Amendment provides for that change to the CDBG grant program. HUD regulations require that the draft Substantial Amendment be made available for a 30-day public review and comment period. On March 30, 2012, notification was published in the Orange County Reporter that the Substantial Amendment was available for review beginning March 30, 2012, and that the public hearing would be held on April 3, 2012. It was also noticed in La Opinion and Nguoi Viet as well as on the City's website. The 30-day public comment period concluded on April 30, at 5 p.m. All comments received, including all funding recommendations made by the City Council, will be included in the final document when it is submitted to HUD. FISCAL IMPACT Funds for the Foreclosed Homes Acquisition Program are available in the HOME Program Account (no. 13018780-69152) and the CDBG Account (nos. 13518782-69152 and 13518783-66200). APPROVED AS TO FUNDS AND ACCOUNTS: Nancy T. E ards Interim Exe tive Director Community Development Agency Francisco Gutierrez Executive Director Finance & Management Services Agency NTE/SLB/TG/mlr 29C-3 2010-2011 and 2011-2012 Annual Action Plan Substantial Amendments and ANR Agreement Amendment May 7, 2012 Page 4 Exhibits: 1. Foreclosed Properties Acquisition Program Description 2. 2010-2011 Action Plan Substantial Amendment 3. 2011-2012 Action Plan Substantial Amendment 4. Amendment to Agreement with ANR 29C-4 FORECLOSED HOMES ACQUISITION PROGRAM Introduction The City of Santa Ana seeks to ensure that its neighborhoods are attractive and well maintained. To that end, the City has applied for and received $10 million in federal Neighborhood Stabilization Program 2 (NSP2) grant funds. These funds may only be used for the acquisition, rehabilitation and resale of foreclosed-upon residential properties located in the City's NSP2 target area (Attachment 1). This Foreclosed Homes Acquisition Program (Program) was created to utilize federal HOME Program and Community Development Block Grant Program funds to supplement the NSP funds. Similar to NSP2, the purpose of the Program is to facilitate acquisition, rehabilitation and resale of foreclosed and abandoned homes and to operate in compliance with the requirements of the NSP2 Program. Existing contracts and procedures established by the City for implementation of its NSP2 grant will also be maintained. When necessary, and when circumstances allow, HOME or CDBG funds allocated for this program may be used in conjunction with NSP funds. In the event of any conflict between NSP regulations and the City's procedures and HOME regulations, the more restrictive will prevail. With certain exceptions called out and treated in the governing statutes, NSP funds have the same regulatory requirements as CDBG. Eligible Use of Funds HOME and CDBG funds may be used to meet the costs of acquisition, rehabilitation, soft costs and developer fees associated with these transactions. Eligible Properties Vacant and foreclosed residential units or parcels suitable for residential development that are located in the target area established by the City for its NSP2 grant are eligible for this Program. When HOME funds are used, the HOME investment per unit shall not exceed the maximum per unit subsidy limit as periodically published by the U. S. Department of Housing and Urban Development (HUD). Whenever HOME funds are used, the value of the property after rehabilitation may not exceed 95% of the area median purchase price for that type of housing. The after-rehabilitation value estimate will be completed prior to investment of the HOME funds. In accordance with NSP requirements, homes must be acquired from the foreclosing party at a minimum discount of 1 % off the as-is appraised value. Eligible Homebuyers To be eligible whenever HOME or CDBG funds are used alone or in conjunction with NSP funds to facilitate the activity, the purchasing household must qualify as low- income. The City will use Section 8 procedures for evaluating household compliance with applicable HOME or CDGB income limits. Effective December 1, 2011, maximum household incomes as adjusted for household size were as follows: Exhibit 1 29C-5 Household Size Income Level Household Size Income Level One $53,950 Five $83,250 Two $61,650 Six $89,400 Three $69,350 Seven $95,550 Four $77,050 Eight $101,750 The purchasing household need not be first time homebuyers, but may not currently own another home, including rental property, and must intend to occupy the new home as their principle residence. They must complete a pre-purchase homebuyer counseling program offered by a HUD-approved homebuyer counseling agency. In addition, they must be pre-qualified for a conventional, fixed interest rate mortgage, and must make a minimum down payment of 3% using their own funds. Gift funds or loan funds may not be used for this purpose. Household size may not exceed two persons per bedroom plus one. Sales Price The homes will be sold at a price equal to or less than the lowest of the following: Total development cost, meaning the total of all funds that were required to acquire, rehabilitate and sell the home; Appraised after rehabilitation value; Affordable housing price as adjusted for the number of bedrooms, the assumed household size for that number of bedrooms, and the maximum household income for a low- or very low-income household of that size As calculated for the NSP Program, effective December 1, 2011, the assumed household sizes and the allowable housing prices were as follows: One Two Three Four Bedrm Five Bedrm Bedrm Bedrm Bedrm Household Size 2 Persons 3 Persons 4 Persons Five Six Persons Persons Allowable Sales $164,200 $184,000 $199,300 $213,400 $228,100 Price Occupancy and Resale Restrictions For a period of fifteen years commencing with the transfer of title to the homebuyer, program participants will be required to maintain their home as their principle place of residence. Those who fail to do so will be found in default of their loan agreement and be subject to a requirement that they sell their home to a low-income homebuyer at a price affordable to such a homebuyer. Program participants voluntarily seeking to sell their home during this initial 15 year ownership will also need to sell their homes to low- income households at affordable prices. Exhibit 1 29C-6 29C-7 29C-8 SUBSTANTIAL AMENDMENT TO THE FISCAL YEAR 2010- 2011 ACTION PLAN: FORECLOSED HOMES PROGRAM INTRODUCTION The City of Santa Ana's Fiscal Year 2010-11 Annual Action Plan 'was submitted to the U.S. Department of Housing and Urban Development (HUD),o "May 15, 2010. Among other items, the Plan allocated the city's anticipated $2,613;050 HOME Program grant funds in a manner consistent with HOME Program regulations and the city's past practice. As a consequence of a $1.2 million repaymeni'4o the HOME Program rude necessary by the failure of a new construction, HOME funded project to move forward, and the recent elimination of redevelopment agencies in California, the city finds itself unable to commit existing HOME Program funds as quickly as it has in the past. In order to make fuller use of these funds and -meet the need of low income residents for affordable, for sale housing opportunities, the `city is creating a new program to be funded with unused HOME and CDBG program funds Additionally, this new program will be run in accordance with federal, guidelines established for the NSP2 program, and will assist the city to meet its goals for.that program. Funding of this new program will require a reallocation of uncommitted 2010-2011 HOME-grant funds. Title 24 Section 91.505 of the Code of Fe deral.Reguiations stipulates that participating jurisdictions shall amend their approved plans whenever they make one of the following decisions: - 1. To make a change in its allocation priorities or a change in the method of distribution of funds; 2. To carry out an activity, using funds from any program covered by the -Consolidated Plan (including program income) not previously described in the action plan; or 3. To change the purpose, scope, location, or beneficiaries of an activity. The Regulation further requires that jurisdictions identify in their citizen participation plans the criteria they will, use for determining what constitutes a substantial amendment. Consistent with these` requirements, the Citizen Participation Plan adopted by the City of Santa Ana as a component of its 2010/11 - 2014/15 Consolidated Five Year Plan identifies three criteria that will require a substantial amendment: 1. Changes in the use of CDBG funds from one eligible activity to another; 2. An activity is undertaken that was not previously included in the Consolidated Plan or subsequent action plans. I Exhibit 2 29C-9 3. More than 30 percent of the most recent annual federal grant allocation is reallocated to other eligible program activities within the fiscal year. The proposed reallocation meets the criteria 2 and 3, and so requires a substantial amendment. CITIZEN PARTICIPATION In accordance with 24 CFR 91.105(c)(3) for local governments,-the substantial amendment Public Notice for the use of CDBG and HOME funds was released for citizen review and comments on March 30, 2012. During the` 30-day public comment period from March 30, 2012 through April 30, 2012 the Pubiic'Notice for the Draft Substantial Amendment was made available during regular business hours between 8:00 a.m. and 5:00 p.m., Monday through Thursday inthe following locations: 1) Housing Department, 20 Civic Center Plaza, 3rd Floor, 2) Communify_Development Agency, 20 Civic Center Plaza, 6th Floor, 3) Office of the Clerk of the Council, 20 Civic Center Plaza, Room 809, 4) the Main Public Library, 26 Civic. Center Plaza, Santa Ana, California and 5) on the city's website. The Community Redevelopment and Housing Commission of the City of Santa Ana held a public fearing on April 3, 2012, at 6:00 p.m., at the City Council Chambers, 22 Civic Center.Plaza, Santa Ana, California 92701. The City Council of Santa Ana will hear and vote on this Substantial Amendment to the 2010-11 Action Plan on May 7, 2012. A !copy of the public hearing notice is presented in Attachment 1, along with P summary of citizen comments received at the public hearing and the remainder of the public comment period. The city's responses to these citizen comments are also included in Attachment 1. PROPOSED ACTIVITY AMENDMENT The proposed amendment will create a new project entitled HOME Foreclosed Homes Acquisition, Program. It will modify the HOME funding allocations established in the 2010-2011 Plan, and transfer funds not required to meet existing activity commitments to this new program.-.Attachment 2 shows the projects and funding levels established in the`2010-2011 Annual Action Plan and the proposed reallocation. 2 Exhibit 2 29C-10 ATTACHMENT 1 PROOF OF PUBLICATION 30-DAY COMMENT PERIOD & PUBLIC HEARING & SUMMARY OF PUBLIC COMMENTS 3 Exhibit 2 29C-11 NOTICE OF PROPOSED ACTION TO BE TAKEN BY THE CITY COUNCIL OF THE CITY OF SANTA ANA RESPECTING PROPOSED SUBSTANTIAL AMENDMENTS TO THE CITY OF SANTA ANA 2010-2011 AND 2011-2012 CONSOLIDATED PLAN ANNUAL UPDATES NOTICE IS HEREBY GIVEN that the Community Redevelopment and Housing Commission of the City of Santa Ana will conduct a public hearing on April 3, 2012 at 6:00 p.m. at the City Council Chambers, 22 Civic Center Plaza, Santa Ana, CA 9:2701 on proposed actions approving substantial amendments to the City's 2010-2011 and 2011-2012 Consolidated Plan Annual Updates. On April 16;'2012 on or about 6:00 p.m. at the City Council Chambers, the City Council will take action; on requests to authorize submittal of the substantial amendments to the U.S. Department of Housing and Urban Development (HUD). The proposed amendments Will reprograrwHOME and Community Development Block Grant funds currently available to the City, and revise the City's Target Geography Area for its NSP3 grant funds. The draft substantial amendments will be available for public review from March 30, 2012 to April 30, 2012 at the following locations Monday Through Friday during normal business hours: Housing Department, 20 Civic Center;Plaza, 3rd Floor; Community Development Agency, 20 Civic Center Plaza, 6th Floor; 'Qffice of the Clerk of the Counci120 Civic Center Plaza, Room 809; and the Main Public Library, 26 Civic Center Plaza, Santa Ana, California. Written comments on ahem must be submitted to the Housing Division on or before April 30,'2012. Publish: March 30, 2012 REVISION TO NOTICE OF PROPOSED ACTION TO BE TAKEN BY THE CITY COUNCIL OF THE CITY OF SANTA ANA RESPECTING PROPOSED ANNUAL ACTION PLAN SUBSTANTIAL AMENDMENTS NOTICE IS HEREBY GIVEN that on May 7, 2012 at or about 6:00 p.m. in the City Council Chambers, 22 Civic Center Plaza, Santa Ana, CA 92701 the City Council of the City of Santa Ana will take action on requests to approve substantial amendments to the City's 2010-2011 and 2011-2012 Annual Action Plans. The City's original Notice published March 30, 2012 indicated that City Council would take this action on April 16, 2012. Publish: April 11, 2012 4 Exhibit 2 29C-12 SUMMARY OF PUBLIC COMMENTS 5 Exhibit 2 29C-13 ATTACHMENT 2: PROPOSED HOME /CDBG CHANGES 2010-2011 HOME/CDBG Program Funding Reallocation 2010-2011 Project Name Fund Allocation New Allocation HOME Admin $261,305 $261,305 HOME CHDO $394,569 $394,569 HOME Multifamily Acquisition Or Rehabilitation $259,787 $0 HOME Single Family Housing Rehabilitation $20b,000 $6,000 HOME New Construction $1,500,000 $621,866 HOME Foreclosed Homes Acquisition $0 $1,329,320 6 Exhibit 2 29C-14 SUBSTANTIAL AMENDMENT TO THE FISCAL YEAR 2011-2012 ACTION PLAN: HOME AND CDBG REPROGRAMMING INTRODUCTION The City of Santa Ana's Fiscal Year 2011-12 Annual Action Plan was submitted to the U.S. Department of Housing and Urban Development (HUD) on May 15, 2011. Among other items, the Plan allocated the city's anticipated HOME Program and Community Development Block Grant (CDBG) funds in a manner consistent with HOME and CDBG regulations and the city's past practice. As a consequence of unforeseen circumstances.?,ffecting both programs, the city has been unable to commit and spend these HOME and:CDBG funds as quickly as it has in the past. In order to make fuller use of these funds and meef;the need of low income residents for affordable, for sale housing opportunities,'the,city is creating,, new program to be funded with unused HOME and CDBG program funds..Additionally, this new program will be run in accordance with federal guidelines established for the,NSP2 program, and will assist the city to meet its goals for that program. Funding of this new program will require a reallocation of uncommitted 2011-2012 HOME grant funds and unused CDBG grant funds generated by loan repayments. Additionally, the 2011-2012 Annual Action Plan committed $890,000 in CDBG grant funds for purchase of new fire equipment to be used in a.fire`station serving a predominately low/mod area. Due to the rei ent outsourcing of the city Fire Department to the Orange County Fire Authority, the funds no longer need to be used for that purpose. Instead, they will be used for necessary repairs to fire stations serving low/mod areas of Santa Ana. Title 24 Section 91.505 of the Code of Federal Regulations stipulates that participating jurisdictions shall amend their approved plans whenever they make one of the following decisions: 1. To make a change in its allocation priorities or a change in the method of distribution of funds; 2. To carry out an activity, using funds from any program covered by the Consolidated Plan (including program income) not previously described in the action plan; or 3. To change the purpose, scope, location, or beneficiaries of an activity. 1 Exhibit 3 29C-15 The Regulation further requires that jurisdictions identify in their citizen participation plans the criteria they will use for determining what constitutes a substantial amendment. Consistent with these requirements, the Citizen Participation Plan adopted by the City of Santa Ana as a component of its 2010/11- 2014/15 Consolidated Five Year Plan identifies three criteria that will require a substantial amendment: 1. Changes in the use of CDBG funds from one eligible activity to another; 2. An activity is undertaken that was not previously included in the Consolidated Plan or subsequent action plans. 3. More than 30 percent of the most recent annual federal grant allocation is reallocated to other eligible program activities within the fiscal year. The proposed changes all meet one of these three criteria, and so require a substantial amendment. CITIZEN PARTICIPATION In accordance with 24 CFR 91.105(c)(3) for local governments, the substantial amendment Public Notice for the use of CDBG and HOME funds was released for citizen review and comments on March 30, 2012. During the 30-day public comment period from March 30, 2012 through April 30, 2012 the Public Notice for the Draft Substantial Amendment was made available during regular business hours between 8:00 a.m. and 5:00 p.m., Monday through Thursday in the following locations: ,1) Housing Department, 20 Civic Center Plaza, 3rd Floor, 2) Community Development Agency, 20 Civic Center Plaza, 6th Floor, 3) Office of the Clerk of the Council, 20 Civic Center Plaza, Room 809, 4) the Main Public Library, 26 Civic Center Plaza, Santa Ana, California and 5) on the city's website. The Community Redevelopment and Housing Commission of the City of Santa Ana held a public hearing on April 3, 2012, at 6:00 p.m., at the City Council Chambers,, 22 Civic Center Plaza, Santa Ana, California 92701. The City Council of Santa Ana will hear and vote on this Substantial Amendment to the 2011-12 Action Plan on May 7,2012- A copy of the public hearing notice is presented in Attachment 1, along with a summary of,citizen comments received at the public hearing and the remainder of the public comment period. The city's responses to these citizen comments are also included in Attachment 1. PROPOSED ACTIVITY AMENDMENTS The proposed amendments will create new projects for the 2011-2012 Annual Action Plan entitled CDBG Foreclosed Homes Acquisition Program and CDBG Foreclosed Homes Acquisition Program. It will modify the HOME funding allocations established in the 2011-2012 Plan, budget previously unused CDBG Program Income funds for the new project, and identify a changed use for $890,000 in CDGB grant funds. Attachment 2 describes these changes. 2 Exhibit 3 29C-16 ATTACHMENT 1 PROOF OF PUBLICATION 30-DAY COMMENT PERIOD & PUBLIC HEARING & SUMMARY OF PUBLIC COMMENTS 3 Exhibit 3 29C-17 NOTICE OF PROPOSED ACTION TO BE TAKEN BY THE CITY COUNCIL OF THE CITY OF SANTA ANA RESPECTING PROPOSED SUBSTANTIAL AMENDMENTS TO THE CITY OF SANTA ANA 2010-2011 AND 2011-2012 CONSOLIDATED PLAN ANNUAL UPDATES NOTICE IS HEREBY GIVEN that the Community Redevelopment and Housing Commission of the City of Santa Ana will conduct a public hearing on April 3, 2012 at 6:00 p.m. at the City Council Chambers, 22 Civic Center Plaza, Santa Ana, CA 92701 on proposed actions approving substantial amendments to the City's 2010-2011 and 2011-2012 Consolidated Plan Annual Updates. On April 16,.'2012 on or about 6:00 p.m at the City Council Chambers, the City Council will take action on requests to authorize submittal of the substantial amendments to the U.S. Department of Housing and Urban Development (HUD). The proposed amendments will reprogram` NOME and Community Development Block Grant funds currently available to the City, and revise the City's Target Geography Area for its NSP3 grant funds. The draft substantial amendments will be available for public review from March 30, 2012 to April 30, 2012 at the following locations Monday,Through Friday during normal business hours: Housing Department, 20 Civic Center: Plaza, 3rd Floor; Community Development Agency, 20 Civic Center Plaza, 6th Floor;. Office of the Clerk of the Counci120 Civic Center Plaza, Room 809;`and the Main Public Library, 26 Civic Center Plaza, Santa Ana, California. Written comments on them must be submitted to the Housing Division on or before April 30, 2012. Publish: March 30, 2012 REVISION TO NOTICE OF PROPOSED ACTION TO BE TAKEN BY THE CITY COUNCIL OF THE CITY OF SANTA ANA'RESPECTING PROPOSED ANNUAL ACTION PLAN SUBSTANTIAL AMENDMENTS NOTICE IS HEREBY GIVEN that on May 7, 2012 at or about 6:00 p.m. in the City Council. Chambers, 22 Civic Center Plaza, Santa Ana, CA 92701 the City Council of the City of Santa Ana will take action on requests to approve substantial amendments to the City's 2010-2011 and 20'11-2012 Annual Action Plans. The City's original Notice published March 30, 2012 indicated that City Council would take this action on April 16, 2012. Publish: April 11, 2012 4 Exhibit 3 29C-18 SUMMARY OF PUBLIC COMMENTS 5 Exhibit 3 29C-19 ATTACHMENT 2: PROPOSED HOME PROGRAM FUNDING REALLOCATION 2011-2012 HOME Program Funding Reallocation 2010-2011 Project Name Fund Allocation New Allocation HOME Admin $229,596 $229,596 HOME CHDO $344,395 $0 HOME Multifamily Acquisition Or Rehabilitation $121,974. $0 HOME Single Family Housing Rehabilitation $100;000 $0 HOME New Construction $1,500,000, $0 HOME Foreclosed Homes Acquisition $0 $2,295,965 CDBG Foreclosed Homes Acquisition 0 $1,000,000 6 Exhibit 3 29C-20 AMENDMENT TO NEIGHBORHOOD STABILIZATION PROGRAM GRANT SERVICES AGREEMENT WITH ANR SANTA ANA NSP, LLC This Amendment is executed by and between the City of Santa Ana, a charter city and municipal corporation organized and existing under the Constitution and laws of the State of California (hereinafter "City") and ANR Santa Ana NSP, LLC, a limited liability company ("Developer") as of May , 2012. RECITALS: A. City and Developer entered into the Neighborhood Stabilization Program (Program 2) Grant Services Agreement (said "Agreement") on March 1, 2010, for Developer to assist City with the acquisition, rehabilitation and resale of foreclosed properties. B. The NSP2 Program requires a minimum production goal of 100 units. Due to higher acquisition and rehabilitation costs, additional funds are required for the City to achieve this goal. The proposed Foreclosed Homes Acquisition Program ("Program") has been designed to augment the current NSP2 efforts and ensure the achievement of the 100 unit goal. C. The City has approved Substantial Amendments to its 2010-11 and 2011-12 Annual Action Plans to fund the Program by reprogramming $3.6 Million Dollars in HOME funds and $1 Million Dollars in CDBG residential loan repayments funds to support the acquisition, rehabilitation and resale of foreclosed and abandoned single-family homes in the NSP2 target area to qualified low income households. D. The parties now desire to amend said Agreement to increase and expand the sources of funding as discussed. WHEREFORE, in consideration of the covenants contained in said Agreement, and subject to all the terms and conditions of said Agreement, except those amended in this Amendment to Agreement, the parties agree as follows: 1. The funding for the Program 2 activities shall be amended to include HOME and CD13G funds in an amount not to exceed Five ($5,000,000) Million Dollars plus program income for the new Foreclosed Homes Acquisition Program. 2. Resale of homes purchased through the new Program will be restricted to households with incomes at or below 80% of the area median income as determined by the U.S. Department of Housing and Urban Development. 3. To the extent participating households want to sell their homes, they are required to resell them to other low income families at an affordable sales price. This resale restriction will remain for a period of fifteen (15) years after transfer of title to the purchasing household. Exhibit 4 29C-21 4. Except as hereinabove modified, the terms and conditions of said Agreement remain unchanged and in full force and effect. IN WITNESS WHEREOF, the parties hereto have executed this Amendment to the Agreement on the date and year first written above. ATTEST: MARIA D. HUIZAR Clerk of the Council CITY OF SANTA ANA PAUL WALTERS Interim City Manager APPROVED AS TO FORM: SONIA R. CARVALHO City Attorney By: LISA E. STORCK Assistant City Attorney DEVELOPER: ANR Santa Ana NSP, LLC By: GEORGE JORDAN Vice President Exhibit 4 29C-22