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C. 63

To:	Board of Supervisors
From:	Catherine Kutsuris, Conservation & Development
Date:	February 26, 2013

Contra

Costa

County

Subject:

Substantial Amendment to the CDBG Action Plan to add a Neighborhood Stabilization Program Activity and Allocate $1.2 million for affordable housing

APPROVE	OTHER
RECOMMENDATION OF CNTY ADMINISTRATOR	RECOMMENDATION OF BOARD COMMITTEE

Action of Board On: 02/26/2013

APPROVED AS RECOMMENDED

OTHER

Clerks Notes:

VOTE OF SUPERVISORS

AYE:

John Gioia, District I Supervisor
Candace Andersen, District II Supervisor
Mary N. Piepho, District III Supervisor
Karen Mitchoff, District IV Supervisor
Federal D. Glover, District V Supervisor

Contact:

Kara Douglas 674-7880

I hereby certify that this is a true and correct copy of an action taken and entered on the minutes of the Board of Supervisors on the date shown.
ATTESTED: February 26, 2013
David Twa,

BY:	, Deputy

RECOMMENDATION(S):

APPROVE the Substantial Amendment to the FY 2012/13 Community Development Block Grant program Annual Action Plan to add a Neighborhood Stabilization Program (NSP1) activity (Activity #8) to support the development of vacant land; and


ALLOCATE $1 million to Habitat for Humanity East Bay/Silicon Valley (Habitat) for its proposed 23 unit project in Bay Point (Pacifica Ave Homes), and $200,000 Satellite Affordable Housing Associates for its 85 unit senior housing project in Antioch (Tabora Gardens)

FISCAL IMPACT:

No General Fund impact. (100% Neighborhood Stabilization Program funds)

BACKGROUND:

NSP 1 was part of the Federal Housing and Economic Recovery Act of 2008 and was intended to assist communities devastated by foreclosures. Contra Costa County was allocated $6,019,051 in NSP1 funds. NSP1 funds may be used for activities which include, but are not limited to:
• Establish financing mechanisms for purchase and redevelopment of foreclosed homes and residential properties;
• Purchase and rehabilitate homes and residential properties abandoned or foreclosed;
• Establish land banks for foreclosed homes;
• Demolish blighted structures;
• Redevelop demolished or vacant properties

On November 18, 2008, the Board of Supervisors approved the FY 2008/09 Action Plan NSP Substantial Amendment (the “Substantial Amendment”). The Substantial Amendment identified seven program areas:
• Activity #1 Purchase and Rehabilitation Program
• Activity #2 Purchase and Self Help Rehabilitation
• Activity #3 Down payment Assistance/Shared Appreciation Loan Program
• Activity #4 Low Income Rental
• Activity #5 Demolition and Land Banking
• Activity #6 Homebuyer Pre-purchase Counseling
• Activity #7 County Administration

Staff recommends adding Activity #8 to support the development of vacant land. The County received multiple applications for HOME Investment Partnerships Act funds and is recommending that two of those projects be allocated NSP1 funds instead of HOME funds:

• Habitat for Humanity East Bay/Silicon Valley (Habitat) is seeking $1 million to support the development of up to 23 units on a vacant site on Pacifica Avenue in Bay Point. Concurrently with this request for funds, Habitat is seeking approval for a General Plan Amendment (GPA) study. An allocation of NSP funds does not imply any support for the application to amend the General Plan. As proposed, NSP will be used for pre-development, permits and fees, and construction costs. Other sources of funds include Habitat contributions, construction loan, State CalHOME funds, and Federal Home Loan Bank (FHLB) Affordable Housing Program (AHP) funds.

• Satellite Affordable Housing Associates (SAHA, formerly Satellite Housing) was awarded $1 million in HOME funds in 2011. Because this project is slow moving and HOME has short expenditure requirements, staff is recommending that a portion of the HOME funds be replaced with $200,000 NSP funds. Through another Board action, staff is recommending that the remaining $800,000 be replaced with fees from the Summer Lake Affordable Housing (SLAH) trust fund. NSP funds will be used for permits and fees, or construction. Other sources of funds include Antioch NSP, Antioch Development Agency, Low Income Housing Tax Credits, Mental Health Services Act, construction loan, and FHLB AHP.

The Habitat project will undergo State and federal environmental reviews (CEQA and NEPA) before the County enters into project agreements and/or loan documents. The SAHA project is fully entitled and all environmental reviews are complete.
The County will enter into various legal documents with the developers for each project. These documents may include some or all of the following: Loan Agreement, Promissory Note, Deed of Trust and Security Agreement, Regulatory Agreement, Intercreditor Agreement, Subordination Agreement, Loan Riders and Estoppels. The form of these documents will be submitted for Board of Supervisors approval at a later date, but prior to execution of any legal documents.

Related Board Actions
In addition to the recommendations in this Board Order, the Board of Supervisor will consider the following recommendations on the February 26, 2013 agenda:
1. Approve the Affordable Housing Finance Committee recommendations for FY 2013/14 HOME and CDBG-housing funds, which includes the recapture $1 million in unspent HOME funds from the (SAHA) Tabora Gardens project.
2. Allocate $800,000 from the SLAH trust fund to SAHA for Tabora Gardens.

CONSEQUENCE OF NEGATIVE ACTION:

If the Board does not approve the NSP substantial amendment, Habitat and SAHA will not be able to move their projects forward this year. These funds are needed for both applicants to leverage additional private and public funds.

CHILDREN'S IMPACT STATEMENT:

Habitat for Humanity proposes to construct 23 new homes in Bay Point suitable for families. This supports outcome 3: Families are Economically Self Sufficient.