DATE: December 13, 2022
TO: Justin Hess, Executive Director
FROM: Patrick Prescott, Assistant Executive Director
VIA: Simone McFarland, Assistant Community Development Director BY: Maribel Leyland, Housing Authority Manager
SUBJECT: Approval of Housing Successor Annual Report for Fiscal Year 2021-2022
RECOMMENDATION
Approve the Fiscal Year (FY) 2021-2022 Housing Successor Annual Report.
BACKGROUND
Each year, the Burbank Housing Authority ( BHA) must submit an Annual Report in accordance with redevelopment unwind law, and more specifically Health and Safety Code Section 34176.1(f). 1 The purpose of the report is to provide information to the governing body on the housing assets and activities of the BHA , specifically for the use of the Low - and Moderate-Income Housing Asset Fund ( Low Mod Fund) for FY 20 21- 2022.
DISCUSSION
The Annual Report is based on housing activities for the fiscal year and information related to the Low Mod Fund. In addition to the Annual Report, an independent financial audit of the Low Mod Fund is conducted and submitted to the governing body within six months after the end of the fiscal year, and will be included in the independent financial audit of Burbank (the host jurisdiction). 2 Finally, the Annual Report is posted on the housing successor’s website as required - https://www.burbankca.gov/web/community- development/housing/burbank-housing-authority.
AFFORDABLE HOUSING DEVELOPMENT
During the reporting period, July 1, 2021 to June 30, 2022, housing staff worked closely with the Burbank Housing Corporation ( BHC) on an Accessory Dwelling Unit (ADU) project for the creation of four AD Us on two of BHC’s current properties. The consideration of that project was held on December 7, 2021, in a joint meeting with Burbank City Council and BHA . The City Council and BHA approved an Affordable Housing Agreement (AHA) and financing to BHC from funds restricted for affordable housing use; including funds from the Low Mod Fund. The approved AHA and financing
1 On January 31, 2012, the City Council and Housing Authority of the City of Burbank (BHA) adopted resolutions designating the BHA as the entity to retain without limitation, all of the housing assets, rights, powers, duties, obligations, liabilities and functions previously performed by the former Redevelopment Agency. 2 As of the writing of this report, the Comprehensive Annual Financial Report (CAFR) is scheduled for presentation to the City Council on January 24, 2023. The CAFR will be posted on-line after submission to the City Council.
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will allow for the construction of four affordable ADUs on two existing BHC properties (BHC ADU Project). There i s no obligation to repay the Low Mod Fund forgivable loan unless, and until, BHC commits a material default of the AHA, the Promissory Note, the Deed of Trust securing that Note, or the Regulatory Agreement, and fails to cure the default within the time periods provided in those documents . BHC is finalizing plans to request bids for the work. Groundbreaking for the BHC ADU Project is tentatively scheduled for early 2023.
Staff will continue to aggressively seek additional affordable housing opport unities to utilize Low Mod Funds for the creation of additional Extremely-Low, Very-Low and Lower- Income Households as required by the funding source; along with other Low Mod Fund requirements as summarized in the following section. Staff is in regular discussions with developers of affordable housing units for opportunities to provide additional affordable housing units with these restricted housing funds.
LOW MOD FUND REPORTING REQUIREMENTS
The required Successor Agency Annual report contains 13 sections to provide information to the governing body on the housing assets and activities related to the Low Mod Fund for the prior fiscal year. The Annual Report (Attachment 1) includes the following information:
1. Amounts received in City/Agency debt reimbursement payments
2. Amounts deposited into the Low Mod Fund
3. Ending balance of the Low Mod Fund
4. Description of expenditures from the Low Mod Fund
5. Value of assets owned by the BHA
6. Description of transfers
7. Project descriptions
8. Status of affordable housing development activities
9. Description of outstanding obligations
10. Description of expenditures by income type
11. Number of senior units produced
12. Amount of excess surplus – Described further below
13. Information on home ownership units
All but one of the requirements of the Successor Agency Annual R eport have been met as outlined in Attachment 1. This item is related to “excess surplus” or unencumbered Low Mod funds that exceed the greater of $1,000,000 or the total deposits in the L ow Mod Fund during the proceeding four years. If there is an excess surplus balanc e, law states the Housing Successor must:
1) Encumber the funds for a project or t ransfer that amount to another jurisdiction within three years; or
2) Transfer that amount to HCD to use pursuant to the Multifamily Housing Program or the Joe Serna Jr. Farmworker Housing Grant Program within 90 days of the end of the aforementioned three-year period.
In addition to reporting the amount of any excess surplus, the law also requires a
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successor agency to note how long the agency has had excess surplus, and the housing successor’s plan for eliminating the excess surplus.
FY 20 20-2021 was the first year the Low Mod Fund had an excess surplus amount ($695,623.22). There is excess surplus in FY 2021-2022 for a second year , but the amount was reduced to $499,927.05 with the encumbered funds for the BHC ADU project approved in December 2021. Staff will continue to seek affordable housing opportunities leveraging other funding sources, with BHC and other housing partners that may include Interim Housing units or a Transitional Housing project to serve homeless or at risk of homeless households. A new acquisition project would utilize a good portion of available funds and eliminate the excess surplus. Staff will provide an update of the Low Mod Fund balance with the next project consideration. In the meantime, staff will continue to seek new housing opportunities for City Council consideration to meet the three-year expenditure requirement for excess surplus as noted in the law.
MONITORING OF AFFORDABLE HOUSING UNITS AND PROGRAMS
Staff utilizes Low Mod and other restricted housing funds (including federal HOME funds) to fund affordable housing projects and programs to work toward meeting the City’s affordable housing goals. Housing staff monitors the city’s affordable housing unit s to preserve affordability and safeguard historical investments . In addition, staff monitor s outstanding loans and grants, and the repayment of funds as program income to the Low Mod Fund. Furthermore, housing staff manages several City Council approved housing programs (funded via various local and state resources) to ensure there is a diverse mix of housing opportunities in the community including: a rapid rehousing program to provide short-term rental assistance for homeless households and households at risk of homelessness; the Lifting People Up financial planning and case management program; and programs to assist homeless households including the navigation center at the SAFE.3
AFFORDABLE HOUSING VOUCHER PROGRAMS
Another critical component to affordable housing in the community are the various voucher programs administered by housing staff including:
• The Section 8 Housing Choice Vouchers (HCV) program that assists extremely-low and very-low income households . Currently 850 of the 1, 014 vouchers are utilized (based on funding) , and an additional 13 vouchers were allocated in October 2022.
Staff is currently in the process of selecting applicants from the waiting list to utilize the new HCV vouchers.
• The Veterans Affairs Supportive Housing (VASH) vouchers to assist homeless veterans. Staff applied for and received 15 VASH vouchers, and will continue to seek additional vouchers to serve the city’s homeless veteran population. • Permanent Supportive Housing (PSH) voucher s that assist veteran and other homeless households in the community . The BHA continues to renew 20 PSH vouchers allocated, and will seek to apply for additional vouchers as available.
3 The SAFE is a self-storage program where homeless community members can safely store personal items and receive case management and referrals to housing resources.
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• Emergency Housing Vouchers (EHV) available for homeless; at-risk of homelessness; those fleeing or attempting to flee domestic violence, dating violence, sexual assault, stalking or human trafficking; and recently homeless households as determined by HUD. The BHA received 67 vouchers in July 2021. As of the writing of this report, 27 voucher holders have leased a unit, and an additional 24 voucher holders are actively searching for a unit. Finally, there are an additional 16 applicants in different stages of the application process to receive a voucher utilizing all 67 vouchers by early 2023.4
Staff will continue to apply for new vouchers as opportunities arise and as appropriate for the Burbank community.
FISCAL IMPACT
There is no fiscal impact associated with the approval of the Annual Report.
CONCLUSION
California Health and Safety Code Section 34176.1(f) requires housing successor agencies to prepare Annual Reports providing the requested information on housing assets and activities. An Annual Report fo r FY 20 21-2022 has been prepared. As summarized in this report, staff continued to seek opportunities to utilize Low Mod funds to create additional housing units and fund programs to assist lower income households, homeless households, and those at risk of homelessness. During the reporting year, the City Council and BHA board approved the BHC ADU Project with financing in available Low Mod funds. Staff will continue to seek similar opportunities in future years to utilize available Low Mod funds. Staff recommends that the BHA Board approve the FY 2021- 2022 Annual Report. Once approved by the BHA Board , the Annual Report will be transmitted to HCD.
ATTACHMENTS
Attachment 1: Housing Successor FY 2021-2022 Annual Report
4Of the 24 voucher holders seeking a unit and 16 going through the process, some may move to another community (port-out), cancel their voucher, or let it expire. Therefore, staff will continue to work the Los Angeles Homeless Services Authority (LAHSA) to continue to receive applications should a voucher become available.