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Home My WebLink About19D - QRTLY RPT HOUSINGREQUEST FOR COUNCIL ACTION CITY COUNCIL MEETING DATE: NOVEMBER 18, 2014 TITLE: QUARTERLY REPORT FOR HOUSING DIVISION PROJECTS AND ACTIVITIES JULY 2014 — SEPTEMBER 2014 (STRATEGIC PLAN NO. 5,3) CTrY MANAGE RECOMMENDED ACTION Receive and file. CLERK OF COUNCIL USE ONLY: APPROVED ❑ As Recommended ❑ As Amended ❑ Ordinance on 1" Reading ❑ Ordinance on 2n' Reading ❑ Implementing Resolution ❑ Set Public Hearing For_ CONTINUED TO FILE NUMBER COMMUNITY REDEVELOPMENT AND HOUSING COMMISSION RECOMMENDATION At its regular meeting on October 8, 2014, by a vote of 4 -0 (Sandoval and Verino absent), the Community Redevelopment and Housing Commission recommended that the City Council receive and file. DISCUSSION This status report for the quarter ending on September 30, 2014 provides statistics for the day -to- day affordable housing activities. The report is divided into three sections: Loan Activity, Loan Portfolio Management and Monitoring, and Development Projects. Loan Activity Applications The Housing Division offers several different programs including homebuyer down payment assistance and rehabilitation loans for historic single - family, single - family and mobile homes. Inquiries are received from the public and applications are mailed out and received for these programs on a continuing basis. Table 1 shows the number of inquiries, applications sent out, received and approved by type for the quarter and the total for the fiscal year. 1901-1 Quarterly Report for Housing Division Projects and Programs November 18, 2014 Page 2 Table 1: Applications Sent Out, Received & Approved Program Inquiries Applications Sent Out Applications Received Applications App roved Q1 Total FY Q1 Total FY Q1 Total FY Q1 Total FY Single-Family Rehabilitation 26 26 18 18 1 1 2 2 Mobile Home Rehabilitation 4 4 2 2 1 1 1 1 Homeownership 44 44 41 41 3 3 2 2 Rehabilitation Loan Underwriting and Approval Process Staff reviews applicant eligibility, verifies income and assets, and oversees underwriting to ensure compliance with program guidelines and requirements established by the funding source. In addition, staff conducts an inspection of the property, prepares a work write up to determine rehabilitation work to be performed, and develops a budget for the work. Due to the complex funding requirements, applicants may be in underwriting several months. The length of time in underwriting is largely determined by the applicant's timely submittal of the necessary paperwork. Once approved, staff prepares all necessary loan documents, makes arrangements for execution, and reserves the required loan funds. Construction Process During this phase, homeowners receiving rehabilitation loans are guided through an open selection of contractors to complete the work on their homes. Each homeowner is given a list of contractors that have been screened by staff for license and insurance requirements. However, homeowners are allowed to select any contractor that meets these same requirements. Staff assists the homeowners in selection of a contractor, monitors the construction work, approves payments to contractors, and tracks expenditures to ensure they do not exceed available funds. At the end of this quarter, there were three homeowner rehabilitation projects out to bid, four under construction, and two were completed. Homeownership Marketing and Approval Process During this quarter staff presented three workshops which were attended by 97 individuals, the majority being Santa Ana residents. Staff evaluates applicant eligibility and oversees underwriting to ensure compliance with program guidelines and requirements established by HUD. Applicants must meet established income requirements, complete an eight -hour pre - purchase counseling program from a HUD - approved 19D-2 Quarterly Report for Housing Division Projects and Programs November 18, 2014 Page 3 agency, be pre - qualified for a first mortgage and have a minimum of three percent of the purchase price from their own savings. Other HUD requirements apply, including a current maximum sales price of $390,000 for a single family home or condo or $443,000 for a newly constructed condo or home. Additionally, the property needs to be in good condition and pass an inspection by staff. Loan Portfolio Management & Monitoring The Housing Division is responsible for ensuring the integrity of the residential loan portfolio. As of the end of this quarter, the principal balance was $108,979,734. This is comprised of 439 loans of which 418 are deferred or residual receipt payment loans. As shown in Table 2, the loan portfolio generated $379,625 in payments of principal and interest during the quarter: Table 2: Portfolio Revenue Monitoring As part of the requirements for these funds, staff must monitor the owner - occupancy for single family homes that have received loans, and the code compliance of units in rental projects with long -term affordability covenants. During this quarter, 26 owner occupancy recertification letters were mailed; 23 were returned and processed. Staff conducted code compliance inspections for 47 units in six projects. Regulations require that only a sample be selected for inspection. Staff also inspects the grounds and common areas to ensure they also meet code requirements and property standards adopted by the City of Santa Ana. The majority of the inspected units as well as the grounds and common areas were found to be in compliance at the time of initial inspection. Some of the units had deficiencies including loose toilets, inoperative bumers, faulty GFCI outlets, inoperative smoke alarms and carbon monoxide detectors. All of the deficiencies were repaired and the units were found to be in compliance at the time of the subsequent re- inspection. 19D-3 I 't Quarter Total FY Loan Payoffs $334,669 $334,669 Residual Receipts Payments 0 0 Amortized Loan Payments $44,956 $44,956 Total $379,625 $379,625 Monitoring As part of the requirements for these funds, staff must monitor the owner - occupancy for single family homes that have received loans, and the code compliance of units in rental projects with long -term affordability covenants. During this quarter, 26 owner occupancy recertification letters were mailed; 23 were returned and processed. Staff conducted code compliance inspections for 47 units in six projects. Regulations require that only a sample be selected for inspection. Staff also inspects the grounds and common areas to ensure they also meet code requirements and property standards adopted by the City of Santa Ana. The majority of the inspected units as well as the grounds and common areas were found to be in compliance at the time of initial inspection. Some of the units had deficiencies including loose toilets, inoperative bumers, faulty GFCI outlets, inoperative smoke alarms and carbon monoxide detectors. All of the deficiencies were repaired and the units were found to be in compliance at the time of the subsequent re- inspection. 19D-3 Quarterly Report for Housing Division Projects and Programs November 18, 2014 Page 4 Development Projects NSP 1 2 and 3 Programs The City's intermediaries, ANR Industries, Orange Housing Development Corporation, and C &C Development, continue to look for eligible properties. The acquisition of a single - family home located at 1235 S. Cypress closed in escrow in August 2014; rehabilitation is expected to commence in October. Multi - Family Acquisition / Rehabilitation Proiects 940 Minnie, LP completed the acquisition of a multi - family property located at 940 S. Minnie Street and is currently in the process of relocating their tenants. The rehabilitation is expected to commence in the fall of 2014. Once the rehabilitation is complete, the property will yield eight affordable rental units consisting four 1- bedroom units, two 2- bedroom units and two 3- bedroom units. In -Fill Development Proiects Habitat for Humanity of Orange County The construction of four single - family dwellings located at 1314 N. Eastwood, 793, 797 and 812 Concord is nearly complete. The homes are expected to be sold to qualified homebuyers in the next quarter. The construction of two single - family dwellings at 4106 and 4110 W. McFadden is expected to begin in the winter of 2014. Depot at Santiago (70 -Unit Affordable Rental Housing Development) The developer has worked through planning entitlements and is planning to apply for a tax credit allocation in the spring of 2015. Construction is anticipated to begin in the fall of 2015. 815 N. Harbor (70 -Unit Affordable Rental Housing Development) The conceptual site plan was approved. The Harbor Corridor Specific Plan is expected to be approved in October 2014. Santa Ana Station District — For Sale (25 Affordable Homes) All of the units are currently under construction. The units located at 806 E. Santa Ana Blvd. are framed; rough plumbing and electrical is progressing. Foundations are complete for the units located at 609 N. Garfield and 620 E. Fifth Street; framing is expected to commence in October 2014. 19D-4 Quarterly Report for Housing Division Projects and Programs November 18, 2014 Page 5 STRATEGIC PLAN ALIGNMENT The activities covered by this report allow the City to meet Goal #5 - Community Health, Livability, Engagement & Sustainability, Objective #3 - Facilitate Diverse Housing opportunities and Support Efforts to Preserve and improve the Livability of Santa Ana Neighborhoods. FISCAL IMPACT There is no fiscal impact associated with this action. Kelly Re d Executiv Director Community Development Agency KR/sk/rl 19D -5 19D-6