City of Anaheim
CITY COUNCIL AGENDA REPORT
HOUSING & COMMUNITY DEVELOPMENT
DEPARTMENT
DATE: OCTOBER 28, 2025
FROM: HOUSING & COMMUNITY DEVELOPMENT DEPARTMENT
SUBJECT: APPROVAL OF RESIDENTIAL REHABILITATION PROGRAM
GUIDELINES MODIFICATIONS AND AUTHORIZATION TO
ENTER INTO SUBRECIPIENT AGREEMENT WITH JOHN
SOTTEK DBA HOUSING PROGRAMS IN THE AMOUNT OF
$50,000 FOR A ONE-YEAR TERM STARTING JULY 1, 2025
THROUGH JUNE 30, 2026 WITH TWO ONE-YEAR OPTIONS
FOR A TOTAL MAXIMUM COMPENSATION OF $150,000
ATTACHMENT (Y/N): YES ITEM # 13
GOVERNMENT CODE § 84308 APPLIES: YES
RECOMMENDATION:
That the City Council, by Motion:
1. Approve modifications to the Residential Rehabilitation Program Guidelines in substantial form;
2. Waive City Council Policy 4.1 for procurement of services and approve a Fiscal Year 2025-2026 Community Development Block Grant (CDBG) Subrecipient Agreement with John Sottek, doing business as, Housing Programs, for Residential Rehabilitation Program administration services in the amount of $50,000 for an initial one-year term from July 1, 2025 to June 30, 2026 with two additional one-year options for a total maximum compensation amount not to exceed $150,000; and
3. Authorize the Housing & Community Development Director, or her designee, to execute all agreements, de minimis updates to operating guidelines and attachments, and other documents necessary to implement and administer the grant activities on behalf of the City, provided that the maximum compensation authority is not increased.
BACKGROUND:
201 S. Anaheim Blvd.
Suite #1003
Anaheim, CA 92805
Tel: (714) 765-4300
Fax: (714) 765-4360
www.anaheim.net
The U.S. Department of Housing and Urban Development (HUD) awards grants to entitlement communities to carry out a wide range of community development activities directed toward neighborhood revitalization, addressing affordable housing needs, economic development, and improvement of community facilities and services.
Updates to Residential Rehabilitation Program
October 28, 2025
The City of Anaheim is an entitlement community and receives funds from four different HUD grant programs, including the Community Development Block Grant (CDBG) program.
Entitlement communities develop their own programs and funding priorities through mandated Consolidated Plan and Annual Action Plan processes. Through these processes, the City solicits community feedback to determine the community's needs and goals to align available funding to related activities. During this solicitation, code enforcement and housing opportunities were identified as priority areas to fund. In response to this feedback, the City used CDBG funds to establish the Residential Rehabilitation Program (RRP), which has been administered since 2016.
The City of Anaheim’s Residential Rehabilitation Program (RRP) provides eligible homeowners with financial assistance, in the form of a grant or loan, to address health and safety concerns or correct code enforcement issues within their homes. The program allows homeowners in need of critical repairs to submit an online application to determine their eligibility for assistance.
To qualify, applicants must own and occupy their property as their primary residence and have a household income at or below 80 percent of the Orange County Area Median Income (AMI).
Following an eligibility determination, a property walkthrough is conducted to assess the scope of work needed to address identified health, safety, or code-related issues. Based on this assessment, the homeowner will be informed of the type and amount of assistance available through the RRP.
Eligible improvements include accessibility modifications, correction of building code violations, electrical and plumbing repairs, fumigation, health and sanitation improvements, interior flooring, lead abatement, roof replacement or repair, structural repairs, window replacement, and other critical home repairs.
All applications are reviewed by the RRP Program Administrator and the City’s Program Manager to determine eligibility and approval for financial assistance.
The RRP offers qualified homeowners (Program Participant), one of the following types of assistance for health and safety repairs and correction of code violations:
A grant for up to $12,000 to owner-occupants of mobile homes registered with the State Housing & Community Development Department. Homeowners can participate in the program no more than once every ten (10) years. (increasing to $15,000)
A minor loan for up to $15,000 with 0% interest, deferred and forgivable after 10 years. Homeowners can participate in the program no more than once every ten (10) years.
A major loan for up to $100,000 with 3% simple interest. The major loan is deferred until and must be repaid in full by year thirty (30).
Upon application approval, a walkthrough of the Program Participant’s property is conducted by the Program Administrator and responsive contractors to determine the scope of work needed to address the health and safety concerns and/or code enforcement issues. The Program Administrator will help determine the type of assistance the Program Participant qualifies for under the RRP.
Updates to Residential Rehabilitation Program
October 28, 2025
DISCUSSION:
Procurement of Program Administration Services
The City has allocated $250,000 of CDBG funds to administer and implement the RRP as part of the Fiscal Year 2025-2026 Annual Action Plan. This allocation is inclusive of expenditures for program administration and delivery, grant and loan assistance, construction costs, and other applicable costs associated with ensuring compliance with health and safety requirements and applicable regulations.
The City’s previous program administrator, Habitat for Humanity of Orange County (HfHOC), has notified staff of its intent to discontinue this role. To maintain continuity, staff recommends entering into a Subrecipient Agreement with John Sottek, doing business as Housing Programs, for $50,000 for an initial one-year term (July 1, 2025 – June 30, 2026), with two optional one-year extensions, for a total not-to-exceed contract amount of $150,000.
Due to the specialized nature of HUD-funded rehabilitation programs, staff further requests authority to waive Council Policy 4.1 for competitive procurement. Housing Programs has extensive experience administering CDBG and HOME-funded rehabilitation programs for several Southern California cities and is well-qualified to ensure program compliance and efficiency. The contractor, Housing Programs, was recently awarded a similar contract with the City of San Juan Capistrano through a competitive Request for Proposal (RFP) for HOME & CDBG Owner-Occupied Rehabilitation Program. Further, Housing Programs has worked and administered housing programs for the cities of Cypress, Brea, Buena Park, Stanton, Pomona, Encinitas, Gardena, Lawndale, Corona, San Marcos, Monterey Park, Rosemead, Hemet, Fontana, and Chino. Their extensive experience makes them highly qualified to perform the work to satisfy strict federal regulations.
With the support of a designated Program Administrator, the City serves as the Program Manager, overseeing the RRP Program for program compliance by confirming application decisions; drafting, issuing, and recording as necessary RRP loan and grant agreements; issuing payments to selected contractors; conducting monitoring and inspections; and other responsibilities aligned with the RRP operating guidelines.
Modifications to Residential Rehabilitation Program Guidelines With the change in Program Administrators, City staff took the opportunity to review the program guidelines and has included these updates in substantial form. City staff recommends one major revision to existing guidelines: increasing the grant assistance for mobile homeowners from $12,000 to $15,000. In reviewing past projects, a significant number of home repair requests have exceeded the $12,000 grant funding limit. Increasing the grant amount will better align available assistance with actual project needs.
All other revisions to the RRP guidelines are de minimis updates to clarify roles and responsibilities of the Program Manager, Program Administrator, and contractors, and to ensure consistency with HUD requirements and best practices.
Staff recommends authorizing the Director of Housing and Community Development to implement future de minimis changes administratively, while reserving all major funding or program structure changes for City Council consideration.
Updates to Residential Rehabilitation Program
October 28, 2025
IMPACT ON BUDGET:
All activities related to the Residential Rehabilitation Program are anticipated to be fully funded by HUD grants and are included in the Housing and Community Development Department’s FY 2025/2026 budget and FY 2025-2026 Annual Action Plan previously authorized by City Council.
In the event grant funds are reduced or eliminated, the Annual Action Plan would be amended to only support activities that are fully funded by available grant allocations.
Respectfully submitted,
Grace Ruiz-Stepter
Director of Housing & Community Development
Attachment:
1. Fiscal Year (FY) 2025-2026 Community Development Block Grant (CDBG) Subrecipient Agreement with John Sottek, doing business as, Housing Programs
2. Residential Rehabilitation Program Guidelines