HomeMy WebLinkAbout19C - MOBILE HOME LOAN INCREASEREQUEST FOR
COUNCIL ACTION
CITY COUNCIL MEETING DATE:
APRIL 7, 2015
TITLE:
MOBILE HOME HARDSHIP PROGRAM
LOAN LIMIT INCREASE
{STRATEGIC PLAN NO 5,3)
�l L�
CITY MANAGE
RECOMMENDED ACTION
CLERK OF COUNCIL USE ONLY:
:--:• S,
❑
As Recommended
❑
As Amended
❑
Ordinance on 1" Reading
❑
Ordinance on 2ntl Reading
❑
Implementing Resolution
❑
Set Public Hearing For
CONTINUED TO
FILE NUMBER
Approve an increase to the maximum loan limit amount from $5,000 to $12,000 and
programmatic revisions to the Mobile Home Hardship Program.
DISCUSSION
Santa Ana has about 30 mobile home parks that provide approximately 3,976 mobile home
spaces. These parks provide affordable housing options for many extremely -low, very-low, and
low- income residents. At least seven mobile home parks are age restricted for seniors.
Currently, the City of Santa Ana ( "City ") offers a Mobile Home Hardship program. This one -time,
forgivable loan of up to $5,000 at zero percent interest is available to households that meet the
following criteria:
• Total annual household income at or below 50 percent of the area median income as
determined by the U.S. Department of Housing and Urban Development (HUD);
• Applicant age 62 or older; or
• Applicant experiencing long -term physical or mental disability, which has inhibited their
ability to obtain gainful employment.
The loan proceeds are utilized to correct code, health and safety deficiencies. General
improvements and upgrades are not supported by the program. The loans are partially forgiven
each year of continued ownership and occupancy based on the following schedule:
Length of Continued Ownership
Percent of Loan Forgiveness
Up to 1 year
0%
1 year and 1 day to 2 years
20%
2 years and 1 day to 3 years
40%
3 years and 1 day to 4 years
60%
4 years and 1 day to 5 years
80%
Greater than 5 years
100%
19C -1
Mobile Home Hardship Program
April 7, 2015
Page 2
Under the new HOME Final Rule, the City must require the scope of rehabilitation work to
address major systems, ensuring that they have a useful life of at least five years upon project
completion, and meet the required property standards. Since the program began, construction
and materials costs have increased, which limits the amount of work that can be completed
within the $5,000 budget.
Currently, eligible applicants are being turned down due to the cost to properly rehabilitate their
mobile home exceeds the maximum loan amount, and the applicants do not have the financial
capability to contribute their own funds to cover the balance. In the event that loan proceeds are
estimated to be insufficient to properly rehabilitate the home, the applicant is expected to
contribute their own funds to cover the balance.
In order to ensure that the program remains effective, staff is recommending that the maximum
loan amount be increased up to $12,000 and offered to all Santa Ana residents with a total
household income at or below 50 percent area median income including seniors, disabled
households, veterans and artists. Two mobile home rehabilitation projects were completed in this
current fiscal year. Currently, there are three projects in the pipeline that would benefit from the
program increase. All other program guidelines will remain the same. The proposed
amendments to the Mobile Home Hardship Program will allow staff to meet the new
requirements of the HOME Final Rule and provide loans to more eligible households within
Santa Ana.
Currently, the City has allocated $200,000 in HOME funds for fiscal year 2014 -15 for the single
family home and mobile home rehabilitation program. The proposed amendments align with the
City's Housing Element, Five -Year Strategic Plan and the Five -Year Consolidated Plan.
STRATEGIC PLAN ALIGNMENT
Approval of this items allows the City to meet Goal #5 (Community Health, Livability,
Engagement & Sustainability), Objective #3 (Facilitate diverse housing opportunities and support
efforts to preserved and improve the livability of Santa Ana neighborhoods).
FISCAL IMPACT
Funds are available in the HOME Program Resident Rehabilitation Loan (Account no.13018780-
69151).
I Re es
Executiv Director
Community Development Agency
KR/SS /nv /sb
APPROVED AS TO FUNDS AND ACCOUNTS:
Francisco Gutierrez
Executive Director
Finance and Management Services Agency
19C -2