MEMORANDUM. From: Tina Kessler, Senior Program Analyst, San Diego Housing Commission

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1 MEMORANDUM To: Members of he Downown Communiy Planning Council From: Tina Kessler, Senior Program Analys, San Diego Housing Commission Dae: March 4, 2015 Subjec: Affordable Housing Fund FY 16 Annual Plan Members of he Downown Communiy Planning Council and members of he Communiy, I am soliciing wrien public commen regarding he programs ha will be funded from he Affordable Housing Fund (AHF) in fiscal year 2016 (July 1, 2015 June 30, 2016). All submied public commens will be included in he Housing Commission and Ciy Council Board Repors. AHF is composed primarily of Inclusionary Housing Fees and Housing Impac Fees, also known as linkage fees. Aached for your review and commen are he draf FY 16 Model Programs lis and FY 16 proposed funding allocaion. Please submi any wrien commen regarding hese funds and programs no laer han Tuesday April 7, Commens should be submied via or US mail o: Tina Kessler inak@sdhc.org or San Diego Housing Commission 1122 Broadway, Suie 300 San Diego, CA 92101

2 Projeced Funding Sources FY 2016 Affordable Housing Fund Annual Plan The Housing Trus Fund (HTF) The Inclusionary Housing Fund Housing Impac Fee Loan Repaymens (CDBG HTF, Redevelopmen, TOT) Cal Sae Housing Trus Fund Affordable Housing Fees (Residenial Developmen) Fund Projeced Fund Balances Projeced FY16 New Funding Toal FY16 Funds HTF - Housing Impac Funds $3,176,558 $2,385,000 $5,561,558 HTF - "CDBG" fund (ineres, Rehab loan repaymens) $0 $0 $0 HTF - Program Funds (ineres, loan repaymens) $ 753, $ 131, $884,519 HTF - Cal Sae Hsg Trus Fund (new gran award) $0 $1,000,000 $1,000,000 Inclusionary Housing Fund - Inclusionary Affordable Housing Fees $21,519,552 $4,115,480 $25,635,032 TOTAL, ALL FUNDS $25,449,335 $7,631,774 $33,081,109 Descripion of HTF Funds: Housing Impac Funds: Sole source of new HTF funds; Commercial Impac Fees. Cal Sae Housing Trus Fund: Iniial source was a Sae mach gran, which has been expended. New gran awarded and included in FY16 funding. Fund balance consiss of loan repaymens and ineres. CDBG HTF: Repaymens of CDBG-funded affordable housing loans were permied o be allocaed o he HTF for Rehab aciviy. Repaymens of loans are recycled ino he HTF for Rehab aciviy. HTF Program Funds: Rehab loan repaymens ha were recycled ino he HTF. Redevelopmen: The HTF received Redevelopmen funds in FY93 and FY95. (See TOT below.) Repaymen of loans are recycled ino he HTF for renal housing finance. TOT: A is 1990 incepion he HTF was o receive a porion of fuure TOT increases. TOT funding ceased and was replaced wih Redevelopmen funds in FY93. Repaymens of loans are recycled ino he HTF.

3 Proposed Allocaion of FY2016 AHF - Aciviy Deail Program/Aciviy /Funding Source* Fund Amouns Esimaed Producion Household AMIs served Renal Housing Finance Inclusionary-funded unis are 65% Affordable Renal Housing Producion Gap financing for AMI or lower. 542 Renal AHF-funded unis are ypically Inclusionary $23,241,222 Housing unis. 50% AMI or lower. HTF Housing Impac Fee $3,751,935 Cal Sae Housing Trus Fund $1,000,000 Program Funds $871,390 Capaciy Building Grans HTF Housing Impac Fee $50, Grans TOTAL ** $28,914,547 Homeownership Deferred Paymen loans; Closing Cos Assisance grans Inclusionary $1,000, unis Serves AMIs up o 80% and up o 100%, subjec o he model programs Housing Innovaions 810 ransiional On average paricipans are Transiional Housing grans housing beds for exremely low o low income. HTF Housing Impac Fee $1,340,602 Corez Hill and 10 oher programs. Adminisraion Inclusionary $1,308,810 Personnel, overhead, HTF Housing Impac Fee $413,522 Program Funds $13,129 & MOU expense $1,735,461 Adminisraion - Legal Inclusionary $85,000 HTF Housing Impac Fee $5,500 $90,500 Fund Balances $0 Fund balances o be allocaed in accordance wih Municipal Code and appropriae approving auhoriies o proposed new Model Programs and/or above curren programs. TOTAL $33,081,110 *See Projeced Funding Source Lis for deails. ** See summary of Approved and Pending Projec Commimens.

4 Projec Summary of Approved and Pending Projec Commimens FY16 Budge Housing Impac Fees FY16 Budge Inclusionary Fees Amosphere $ 700, COMM 22 Family $ 167, Hoel Churchill $ 880, $ 1,600, Independence Poine (WJJ) $ 300, VVSD Phase 5 $ 10, Mission Gorge $ 7,600, Trolley Residenial $ 1,120, FY16 Budge Cal Sae Hsg Trus Fund FY16 Budge Program Funds 14h & Imperial $ 600, $ 500, Unidenified Permenen Supporive Housing Projecs $ 2,561, $ 11,453, $ 500, $ 871, Sub-Toal $ 3,751, $ 23,241, $ 1,000, $ 871, TOTAL $28,864,547.00

5 HOUSING COMMISSION MODEL PROGRAMS OVERVIEW Funding is allocaed on an annual basis among he various aciviies auhorized by he Code. To assure ha he Ciy serves is residens in he bes possible manner, he Housing Commission coninues o solici ideas for improving he Model Programs o beer respond o communiy needs for affordable housing and qualiy neighborhoods. Model Programs change from ime o ime; hey are no inended o preclude invesmen in an opporuniy ha is no specifically described in he Model Programs Secion. The following is a general descripion of he possible invesmen aciviies planned for FY2016. These aciviies are described more fully in he aached Model Programs. Renal Housing Finance Financing o developers of affordable housing unis wih below-marke rens. Program includes deferred loans, below marke ineres raes, and maching funds for Sae, Federal, and privae financing. Housing Commission Policy PO conains addiional informaion regarding he Housing Commission s financial paricipaion in affordable renal housing developmen including new consrucion or acquisiion wih rehabiliaion. Renal Housing Finance Transi Oriened Developmen (TOD)/Workforce Housing A program similar o he Renal Housing Finance program. TOD/Workforce housing and affordable renal housing projecs ha mee cerain geographical requiremens will receive funding preference over oher affordable renal housing projecs. Renal Housing Finance Housing Commission Developmen Gap financing for Housing Commission developmens when oher funds are unavailable or local mach funds are needed. Developmens include new consrucion, acquisiion, acquisiion wih rehabiliaion and preservaion of exising affordable renal housing. Permanen Supporive Renal Housing Financing o developers of permanen affordable renal housing wih relaed services ha serve special residen populaions, including hose who are a risk of becoming homeless or need services relaed o physical or menal disabiliies, chronic healh problems (HIV/AIDS) or are recovering from subsance abuse. Program includes deferred loans, below marke ineres raes, revocable grans, and maching funds for Sae, Federal and privae financing. Housing Commission Policy PO conains addiional informaion regarding he Housing Commission s financial paricipaion in housing developmen. Homeownership Junior loan/gran programs argeed oward firs-ime homebuyers wih he ulimae goal of neighborhood sabilizaion and revializaion. Housing Iniiaives Programs Homeless Programs, Permanen Supporive Housing and Transiional Housing The Housing Commission helps suppor or operae several programs ha serve he homeless, ranging from emergency shelers, o operaing suppor grans for ransiional housing faciliies, o providing subsidies via local renal assisance programs such as he Sponsor-Based Subsidy program. The laer are designed o assis low-income residens achieve sabiliy by providing innovaive housing soluions.

6 Capaciy Building Technical assisance provided o increase capaciy in developing affordable housing. Adminisraion Funds o provide reasonable compensaion o he Ciy of San Diego and he Housing Commission for services relaed o he adminisraion of he Affordable Housing Fund and associaed housing programs. Legal Expenses o obain legal services and prepare loan and gran agreemens and relaed documens.

7 SAN DIEGO HOUSING COMMISSION MODEL PROGRAMS Legend: HTF: Housing Trus Fund INCL: Inclusionary Housing Fund HOME: HOME Invesmen Parnerships Program (HUD) Represens eligible funding sources for each aciviy RENTAL HOUSING PRODUCTION Renal Housing Finance 100% Affordable Projecs HTF INCL HOME OTHER Below-marke ineres rae, residual paymen subordinae loan program o increase he supply of affordable renal unis in he Ciy of San Diego, o include new consrucion, acquisiion, and acquisiion wih S rehabiliaion. Funds may also be used for he preservaion of exising affordable unis facing expiraion of ren resricions wihin 0 5 years. a Loans o developmens wih a leas 100 percen of he unis are affordable o households a or below 60 percen of area median income (AMI) (manager unis excluded). Preference will be given o projecs e ha mee a leas one of he following crieria: affordable o households a or below 50 percen AMI; qualified as ransi-oriened developmen/ workforce housing; locaed wihin ¼ mile of a SANDAG-designaed employmen cener; locaed in a census rac wih low-income concenraions of less han 41 percen; or locaed norh of Inersae 8; or wih a leas 15% of he unis designaed as permanen supporive housing (see Permanen Supporive Renal Housing Finance model program below). Loan Terms Loan Underwriing Exremely low-, very low- and low-income households. Maximum erm o mauriy is 55 years. Repaymen of principal and ineres is amorized, due and payable as a balloon paymen; or as residual receips, due and payable a mauriy. Loan may be originaed as a consrucion loan and convered ino long erm financing. Subjec o loan policies of he San Diego Housing Commission unless specific excepion as auhorized by he Housing Commission. Funds for program o be made available hrough Reques for Proposals (RFP) or Noice of Funding Availabiliy (NOFA). RFP/NOFA requires applican o sipulae he ren schedule for he projec.

8 Transi-Oriened Developmen (TOD)/Workforce Housing Mixed Income Projecs HTF INCL HOME OTHER Below-marke ineres rae, deferred paymen junior morgage loan program o increase he supply of affordable renal unis in he Ciy of San Diego, o include new consrucion, acquisiion and acquisiion wih rehabiliaion. Loans o developmens wherein a leas 20 percen of he unis are affordable o households a or below 50 percen of AMI (manager unis excluded). Projecs mus mee a leas one of he following crieria: qualified as ransi-oriened developmen or workforce housing; locaed wihin ¼ mile of a SANDAG designaed employmen cener; locaed in a census rac wih low-income concenraions of less han 41 percen; or locaed norh of Inersae 8. S a e Loan Terms Loan Underwriing Exremely low-, very low- and low-income households. Maximum erm o mauriy is 55 years. Repaymen of principal and ineres is amorized, due and payable a mauriy. Loan may be originaed as a consrucion loan and convered ino long erm financing. Subjec o loan policies of he San Diego Housing Commission unless specific excepion as auhorized by he Housing Commission. Funds for program o be made available hrough Reques for Proposals (RFP) or Noice of Funding Availabiliy (NOFA). RFP/NOFA requires applican o sipulae he ren schedule for he projec. Renal Housing Finance Housing Commission Developmen HTF INCL HOME OTHER Funding for Housing Commission affordable renal housing developmens when oher funds are unavailable or local mach funds are needed. Anicipaed uses are expenses ineligible for non-ahf funds. Exremely low o moderae income households. Gran Terms Projecs would be affordable a minimum of 55 years. Permanen Supporive Renal Housing Finance HTF INCL HOME OTHER A loan and gran program for permanen housing wih suppor services for special needs populaions including hose a risk of becoming homeless or hose in need of special services relaed o physical or S menal disabiliies, chronic healh problems (HIV/AIDS), or hose recovering from subsance abuse, ha will maximize he abiliy of hose a persons o live independenly. Loans and grans may be used for he developmen, acquisiion or long-erm leasing of housing faciliies, improvemens o exising faciliies, and capialized operaing reserves. e Exremely low and very low-income populaions idenified as needing permanen housing in a service-enhanced environmen; selecion of populaions o be generally compaible wih requiremens of federal funding sources.

9 Loan Terms Loan Underwriing Gran Terms Maximum erm o mauriy is 55 years. Paymen of loan principal and ineres is due and payable as a residual receips loan or as a balloon paymen a mauriy bu may be forgiven upon exension of affordabiliy requiremens. Loan may be originaed as a consrucion or rehabiliaion loan and convered ino long erm financing. Subjec o loan policies of he Housing Commission unless specific excepion as auhorized by he Housing Commission. Gran Terms: Subjec o revocaion/repaymen for nonperformance. Funds for program o be made available hrough RFPs or NOFA. HOMEOWNERSHIP PROGRAMS 3% Ineres Deferred Paymen Loan Program (Unresriced Unis) HTF INCL HOME OTHER A second rus deed loan program for low and moderae-income firsime homebuyers ha bridges he gap beween wha households can afford and he acual cos of acquiring a home wih affordabiliy resricions. (Second rus deed no o exceed he lesser of 17 percen of he purchase price or appraised value.) The loan program is argeed mainly o households earning up o 80 percen of median income ha mee usual bank underwriing crieria for firs morgages. Limied funds are available for buyers earning up o 100 percen of median income. S a e Loan Terms Loan Underwriing: Loans are a hree percen simple ineres and require no monhly paymens. The loan erm is 30 years. When a propery is sold, ransferred, or he loan erm expires, buyer mus pay he Housing Commission he principal balance due, plus accrued ineres. Approval from insiuional lender required. Subjec o loan policies of he San Diego Housing Commission unless specific excepion as auhorized by he Housing Commission. Purchasers apply hrough paricipaing Lenders. 3% Ineres Deferred Paymen Loan Program (Resriced Unis) HTF INCL HOME OTHER A second rus deed loan program for low and moderae-income firsime homebuyers purchasing affordable-resriced unis (e.g. inclusionary, densiy bonus), ha bridges he gap beween wha households can afford and he acual cos of acquiring a home wih affordabiliy resricions. (Second rus deed no o exceed 25 percen of he affordable purchase price if 80 percen or below median income and no o exceed 17 percen for buyer a percen median income). Households earning up o 100 percen of median income ha mee usual bank underwriing crieria for firs morgages.

10 Loan Terms Loan Underwriing: Loans are a hree percen simple ineres and require no monhly paymens. The loan erm is 30 years for lengh of ime uni mus remain affordable. When a propery is sold, ransferred, or a he end of he loan erm, buyer mus repay he Housing Commission he principal balance and all deferred ineres. Approval from insiuional lender required. Subjec o loan policies of he Housing Commission unless specific excepion as auhorized by he Housing Commission. Purchasers apply hrough paricipaing Lenders. Down Paymen/Closing Cos Assisance Program HTF INCL HOME OTHER A gran program for firs-ime homebuyers ha pays up o 4 percen of he purchase price; no o exceed $15,000 when a or below 80% AMI and no o exceed $10,000 for 81% - 100% AMI o be used owards closing coss. Households earning up o 100 percen of median income ha mee usual bank underwriing crieria for firs morgages. C D B G Gran Terms This is a recoverable gran and repaymen of he funds is forgiven afer 6 years. Neighborhood Sabilizaion Acquisiion Loans HTF INCL HOME OTHER A second rus deed loan program for moderae-income firs-ime homebuyers purchasing a bank owned propery locaed in argeed areas. Maximum sales price is $408,500 and maximum loan amoun is N 17 percen of he purchase price. Purchase price mus be a leas one S percen below appraised value. P Loan Terms Households earning up o 120 percen of median income ha mee usual bank underwriing crieria for firs morgages. The loans are zero percen ineres and require no monhly paymens of principal. The loan is due a he end of 30 years or upon resale, ransfer or if he propery is no longer owner occupied. Approval from insiuional lender required. F u n d s Loan Underwriing: Subjec o loan policies of he San Diego Housing Commission unless specific excepion as auhorized by he Housing Commission. Purchasers apply hrough paricipaing Lenders. Neighborhood Sabilizaion Closing Cos Grans HTF INCL HOME OTHER A revocable gran program for firs-ime homebuyers purchasing a bank owned propery under he Neighborhood Sabilizaion Program (NSP) N guidelines. The gran pays up o hree percen of he purchase price S owards closing coss. P Households earning up o 120 percen of median income ha mee usual bank underwriing crieria for firs morgages. F

11 Gran Terms Repaymen of he gran, plus 5 percen ineres is required if he home is sold or ransferred wihin he firs six years of ownership. u n d s Purchasers apply hrough paricipaing Lenders. Neighborhood Sabilizaion Rehabiliaion Loans HTF INCL HOME OTHER A hird rus deed loan program for moderae-income firs-ime homebuyers purchasing a bank owned propery under he NSP guidelines. Households earning up o 120 percen of median income ha mee usual bank underwriing crieria for firs morgages. N S P Loan Terms Loan Underwriing: The loans are zero percen ineres and require no monhly paymens of principal. Rehab loans up o $10,000 are forgiven afer 5 years. Rehab loans up o $30,000 will be forgiven afer 10 years and Rehab loans in excess of $30,000 will be forgive afer 15 years. If propery is sold, refinanced, no owner occupied or he improvemens have no been mainained prior o he end of he erm, he loan funds mus be repaid. Subjec o NSP guidelines as approved by San Diego Housing Commission. F u n d s Purchasers apply hrough Housing Commission. HOUSING INITIATIVES Homeless Programs, Permanen Supporive Housing, Transiional Housing Emergency Sheler HTF INCL HOME OTHER The Houisng Commisison adminisers, on behalf of he Ciy of San Diego, emergency sheler programs ha provide emporary sheler wih supporive services for persons experiencing homelessness. Targe Populaion Terms Homeless individuals, families, and Veerans Up o 90 days. Hoel/Moel Vouchers HTF INCL HOME OTHER When oher sheler is no available, homeless families can apply for emergency hoel/moel vouchers. The Housing Commission provides parial funding for his program, which is adminisered by he Couny of San Diego. Targe Populaion Terms Elderly persons 65 or older, families wih children, persons wih severe disabiliies, and pregnan women (on a case-by-case basis) days. Adminisered by he Couny of San Diego.

12 Inerim Housing HTF INCL HOME OTHER The Housing Commission adminisers, on behalf of he Ciy of San Diego, inerim housing programs wih supporive services for he homeless. Targe Populaion Homeless Individuals. Terms Up o 120 days for inerim housing beds. Transiional Housing HTF INCL HOME OTHER A gran and loan program for nonprofi operaors of ransiional housing or permanen supporive housing. Grans and loans may be used for he leasing or operaion of ransiional housing and permanen supporive housing faciliies as well as improvemens o exising leased faciliies. No more han 25 percen of gran funds may be used for adminisraion and suppor services. Gran Terms Homeless families and individuals. Up o 24 monhs. Funds for program o be made available hrough RFPs or NOFA. Transiional Projec-Based Subsidies for he Homeless HTF INCL HOME OTHER Subsidies are issued o a parnering agency providing supporive services o homeless individuals while appropriae housing soluions are idenified. Targe Populaion Terms Homeless individuals Shor-erm renal assisance Subsidies are awarded o agencies via an RFP process. Rapid Re-Housing HTF INCL HOME OTHER Shor-erm assisance o help persons experiencing homelessness obain and mainain permanen housing. Assisance can include renal subsidy, securiy deposis, uiliy assisance, and case managemen. Term Homeless individuals, families, and Veerans. Varies depending on projec. Assisance can range from 3 24 monhs. Funds for program made available hrough RFPs or NOFA.

13 Permanen Supporive Housing HTF INCL HOME OTHER Permanen Supporive Housing provides homeless persons wih disabiliies permanen housing wih supporive services so ha hey may live as independenly as possible in a permanen seing. Terms Disabled homeless individuals Indefinie (Permanen Supporive Housing) Funds for program made available hrough RFPs or NOFA. Federal Sponsor-Based Housing Subsidy Program HTF INCL HOME OTHER A renal assisance program for homeless individuals wih diagnosed menal healh or drug and alcohol disorders. Targe Populaion Homeless individuals Terms Indefinie (Permanen Supporive Housing) Federal Sponsor-Based Housing subsidies are awarded o agencies via an RFP process. Day Cener Services HTF INCL HOME OTHER Homeless individuals are provided wih laundry faciliies, showers, mail, case managemen, sorage, and referral services. Targe Populaion Homeless individuals. Terms Dayime, Year-Round Regional Coninuum of Care Council (RCCC) Suppor HTF INCL HOME OTHER The Housing Commission is a member of he RCCC, which has 75 members across he communiy, including providers of services, governmen agencies and he privae secor. I oversees federal homeless assisance funds for he region. The Housing Commission suppors various elemens fo he RCCC including he Homeless Managemen Informaion Sysem (HMIS), a criical componen of he communiy s service delivery sysem. Targe Populaion Programs and services for homeless San Diegans.

14 Targe Populaion/ Beneficiaries CAPACITY BUILDING PROGRAM Technical Assisance Program HTF INCL HOME OTHER A echnical assisance program ha will assis corporaions and limied equiy cooperaives in increasing he capaciy o develop affordable housing. Program o provide "hands on" echnical assisance in such areas as concep developmen, sie assessmen and acquisiion, feasibiliy analysis, specificaion wriing, bid packaging and review, permi procedures, consrucion oversigh, grans and applicaion preparaion, record keeping and developer capaciy required by funding sources. Corporaions and limied equiy cooperaives wih limied housing experience. Gran Terms Gran is for he delivery of echnical assisance services o housing developers. of work will be ariculaed in conrac documens. Funds o be made available hrough RFP or Housing Commission conrac policy.

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