201 S. Anaheim Blvd.
Tenth Floor
Anaheim, CA 92805
Tel: (714) 765-4320
Fax: (714) 765-4331
www.anaheim.net
CITY COUNCIL AGENDA REPORT
City of Anaheim
HOUSING & COMMUNITY DEVELOPMENT
DEPARTMENT
DATE: DECEMBER 20, 2022
FROM: HOUSING & COMMUNITY DEVELOPMENT DEPARTMENT
SUBJECT: RESOLUTION APPROVING AND AUTHORIZING THE
APPLICATION FOR AND RECEIPT OF SB2 PERMANENT
LOCAL HOUSING ALLOCATION PROGRAM GRANT FUNDS
AND AUTHORIZING THE HOUSING AND COMMUNITY
DEVELOPMENT DIRECTOR OR HER DESIGNEE TO
OBTAIN SUCH ADDITIONAL GRANT FUNDS
ATTACHMENT (Y/N): YES ITEM # 26
RECOMMENDATION:
That the City Council, by Motion:
(1) Adopt a Resolution approving and authorizing the application and receipt of Permanent Local Housing Allocation Program Grant funds for affordable housing development;
(2) Authorize the Housing and Community Development Director or her designee to obtain and administer the grant funds; and
(3) Amend the Department’s Fiscal Year 2022-23 budget accordingly up to $5,841,835 to incorporate these funds.
DISCUSSION:
In 2017, Governor Brown signed a 15-bill housing package aimed at addressing the state’s housing shortage and high housing costs. Specifically, it included the Building Homes and Jobs Act, also referred to as Senate Bill 2 (SB 2). Revenues for this fund, also referred to as the Permanent Local Housing Allocation Program (PLHA) are generated through the collection of a $75 recording fee on particular real estate transactions and, therefore, vary from year to year depending upon activity. The State Department of Housing and Community Development (HCD) has estimated that the City’s allocation over a five-year period, beginning in calendar year 2019, will be approximately $12,931,000.
On June 23, 2020, the City Council approved and adopted a resolution to submit an application and five-year Permanent Local Housing Allocation Plan (PLHA Plan) for PLHA grant funds (Attachment 3). The PLHA Plan required the City to outline how the funds would be utilized over the course of a five-year funding cycle. The format for the Plan was prescribed by the state and consisted of a template with predefined questions Resolution Approving Permanent Local Housing Allocation Program Grant Funds December 20, 2022
that each jurisdiction was required to answer, including how the City would prioritize investments that increased the supply of affordable housing.
The PLHA Plan approved in June 2020 identified several viable development projects that could benefit from PLHA program funds including the 100 West homeownership project located at the southwest corner of Cerritos Avenue and Anaheim Boulevard and a large Housing Authority-owned project site located on Carl Karcher Way between Harbor Boulevard and Anaheim Boulevard. Since the Plan was adopted by City Council in June 2020, alternative funding sources were identified, which replaced the down payment assistance slated for the 100 West project and opportunities for critical acquisitions of nuisance motels along Beach Boulevard came to fruition and were deemed a higher priority. As a result, the Plan is being amended to reflect the current goals for the use of these funds.
In order to re-allocate the PLHA funds to alternative projects, HCD requires that the City Council, by Resolution, resubmit a PLHA application and approve an amendment (Amendment No. 1) to the PLHA Plan identifying how the PLHA funds will continue to be used to increase the supply of affordable housing (Attachment 2). The amended PLHA Plan will now re-allocate the 2019-2021 PLHA funds for the acquisition of several motel sites on Beach Boulevard for the purpose of creating affordable housing.
The acquisition of the motels is an eligible activity under the PLHA program. The projects identified in the amended Plan are the following:
Area Median IncomeFunding
Year
Projects Project Type Population
Served 30% 50% 60% 80% 120%-
150%
Total
Units
2019 Anaheim
Lodge
Mixed-use with
varying affordable
housing
opportunities
Workforce
Family
13 26 13 6 6 64
2020 Covered
Wagon
Motel
Mixed-use with
varying affordable
housing
opportunities
Workforce
Family
7 15 7 4 4 37
2021 Beach
Blvd.
Motel
Site
Mixed-use with
varying affordable
housing
opportunities
Workforce
Family
6 14 6 3 3 32
2022 Karcher Site Mixed-use with
varying affordable
housing
opportunities
Multi-
Generational
97 243 145 0 0 485
Staff is recommending that the City Council authorize the Housing and Community Development Department to re-submit the PLHA application and approve Amendment No. 1 to the 5-Year PLHA Plan to HCD and administer all aspects of the PLHA program on behalf of the City of Anaheim for the creation and preservation of affordable housing.
Authority to administer the PLHA funds does not alter the City Council’s authority over decision-making on individual projects and programs. Unless previously authorized by Resolution Approving Permanent Local Housing Allocation Program Grant Funds December 20, 2022
the City Council, all funding commitments for individual multifamily projects and/or other housing programs will be brought forth to the City Council for review and approval.
RECEIPT OF FUNDS:
In February 2021, the City was awarded 2019 PLHA funds in the amount of $2,155,285; however, at the time, the department budget was not amended to reflect this allocation.
The City was subsequently awarded 2020 PLHA funds in January 2022 and the allocation was approved by City Council as part of the FY 22/23 budget. Since the 2019 allocation was not previously reflected in the Department’s authorized budget, staff is now requesting an increase to the FY 22/23 department budget for the 2019 PLHA funds ($2,155,285) and the anticipated 2021 PLHA allocation of $3,686,550 for a total of $5,841,835.
IMPACT ON BUDGET:
The PLHA funds are restricted funds provided by the California State Department of Housing and Community Development and will supplement the city’s resources to increase the supply of affordable housing units. The department’s budget would be increased up to $5,841,835 for the 2019 and 2021 allocations of grant funds. The 2020 allocation was included in the adopted FY 22/23 budget.
Respectfully submitted,
Grace Ruiz-Stepter
Director of
Housing and Community Development
Attachments:
1. Resolution
2. PLHA Plan Amendment No. 1
3. Original PLHA Plan (June 23, 2020)