RESOLUTION NO._______
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF FOSTER CITY AUTHORIZING APPLICATION FOR AND RECEIPT OF 2024 CALIFORNIA
DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT LOCAL HOUSING TRUST FUNDS AND OTHER RELATED APPROVALS; AND AUTHORIZE THE CITY
MANAGER OR HIS DESIGNEE TO MAKE AMENDMENTS TO THE APPLICATION AS
NEEDED, AND EXECUTE OTHER GRANT DOCUMENTS, AS NEEDED
CITY OF FOSTER CITY
A majority of the members of the City Council of the City of Foster City (“Applicant:”) hereby consents to, adopts and ratifies the following resolution:
WHEREAS, the California Department of Housing and Community Development (Department) is authorized to provide up to $53 million under the Local Housing Trust Fund (“LHTF”) Program from the Veterans and Affordable Housing Bond Act of 2018 (Proposition 1) (as described in Health and Safety Code section 50842.2 et seq. (Chapter 365, Statutes of 2017 (SB 3)) (“Program”); and
WHEREAS the State of California (the “State”), Department issued a Notice of Funding Availability (“NOFA”) dated 7/9/2024 under the LHTF Program; and WHEREAS the City of Foster City (acting as an Applicant) is an eligible Local or Regional Housing Trust Fund applying to the Program to administer one or more eligible activities using Program Funds; and
WHEREAS the Department may approve funding allocations for the LHTF Program, subject to the terms and conditions of H&S Code Section 50842.2, the LHTF Program Guidelines, NOFA, Program requirements, the Standard Agreement and other related contracts between the Department and LHTF award recipients.
NOW, THEREFORE, the City Council of the City of Foster City hereby RESOLVES as follows:
1. If the City of Foster City/Applicant receives an award of LHTF funds from the Department pursuant to the above referenced LHTF NOFA, it represents and certifies that it will use all such funds on Eligible Projects in a manner consistent and in compliance with all applicable state and federal statutes, rules, regulations, and laws, including, without limitation, all rules and laws regarding the LHTF Program, as well as any and all contracts the City/Applicant may have with the Department (“Eligible Project”).
2. NOW, THEREFORE, IT IS RESOLVED: That the Foster City Local Housing Trust Fund is hereby authorized to act as the manager in connection with the Department's funds to Eligible Projects pursuant to the above described Notice of Funding Availability in an amount not to exceed $4,675,000 (the "LHTF Award"), including up to $233,750 for administrative costs.
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3. The City of Foster City/Applicant hereby agrees to match on a dollar-for- dollar basis the LHTF Award pursuant to Guidelines Section 104. Applicant hereby agrees to utilize matching finds on a dollar-for-dollar basis for the same Eligible Project for which Program Funds are used, as required by HSC Section 50843.5(c). Specifically, the City of Foster City/Applicant hereby commits to using Local Housing Trust Funds for the programs listed in Attachment 1, attached hereto and incorporated herein, including: 1) Below Market Rate Multifamily Affordable Rental Development Loan Program, 2) Below Market Rate Accessory Dwelling Unit Loan Program, and, 3) Low Income Homeowner Rehabilitation Loan Program.
4. Pursuant to Attachment 1 and the City of Foster City’s/Applicant’s certification in this resolution, the LHTF funds will be expended only for Eligible Projects and consistent with all program requirements.
5. The City of Foster City/Applicant shall be subject to the terms and conditions as specified in the Standard Agreement, H&S Section 50842.2 and LHTF Program Guidelines.
6. Stefan Chatwin, City Manager of the City of Foster City, or his designee, is hereby authorized to execute the LHTF Program Application, the LHTF Standard Agreement and any subsequent amendments or modifications thereto, as well as any other documents which are related to the Program or the LHTF Award to Applicant, as the Department may deem appropriate.
PASSED AND ADOPTED as a resolution of the City Council of the City of Foster City at the regular meeting held on the 3rd day of September 2024 by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
_____________________________________
PATRICK SULLIVAN, MAYOR
ATTEST:
_________________________________
PRISCILLA SCHAUS, CITY CLERK
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Attachment 1
LHTF Loan Programs Summary
Commitment of Use of Program Funds and Matching Funds
Summary of Commitment of Funds for Program and Matching Funds for LHTF NOFA The City of Foster City is committed to using the LHTF NOFA Program Funds and Matching Funds to create three affordable housing loan programs for the City of Foster City with a total fund amount of $9,350,000, comprised of the following Affordable Housing Loan Programs. All three programs will benefit projects in the City of Foster City. Tables 1 and 2 show the program funding and affordability allocations for each program. Table 3 shows the interest rates for each program.
1. Below Market Rate Multifamily Rental Development Loan Program Construction or permanent loans to non-profit or for-profit developers for new multi-family rental construction projects with rent and income restrictions of units at less than 30% of AMI and/or or less than 60% of AMI. The maximum loan amount is $5,557,500. This program uses the Uniform Multifamily Regulations (UMRs) as the loan guidelines, underwriting standards, and procedures for approving and managing loans.
2. Below Market Rate Accessory Dwelling Unit Loan Program Construction loans to homeowners to construct new ADUs, either attached or detached, or JADUs.
ADUs shall be rent and income-restricted to households earning less than 60% of AMI or 30% of AMI for ten years. The maximum loan amount is $100,000 and a maximum of one loan per property owner. Interest on the loan would be 3% for ADUs restricted to 60% of AMI or 0% for ADUs restricted to 30% of AMI. The program uses the City’s Below Market Rate Accessory Dwelling Unit Loan Program Underwriting Guidelines for approving and managing loans.
3. Low Income Homeowner Rehabilitation Loan Program
Loans to low-income homeowners with incomes of less than 60% and less than 30% of AMI to rehabilitate their existing homes. The maximum loan amount is $100,000 and a maximum of one loan per property owner. Interest on the loan would be 3% for owners with incomes of less than 60% of AMI or 0% for owners with incomes of less than 30% of AMI. The program uses the City’s Low Income Homeowner Rehabilitation Loan Program Underwriting Guidelines for approving and managing loans.
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Attachment 1, continued
Table 1. Program Funding
Program
Program
Funds
Request
City
Matching
Funds
Program
Funds Total
% of Total
Funds
Maximum
Administrative
Expenses*
%
Admin
1. Below Market
Rate
Multifamily
Rental
Development
Loan Program
$ 2,925,000 $ 2,925,000 $ 5,850,000 63% $292,500 5%
2. Below Market
Rate Accessory
Dwelling Unit
Loan Program
$ 750,000 $ 750,000 $ 1,500,000 16% $75,000 5%
3. Low Income
Homeowner
Rehab Loan
Program
$ 1,000,000 $ 1,000,000 $ 2,000,000 21% $100,000 5%
Total $ 4,675,000 $ 4,675,000 $ 9,350,000 100% $467,500 5% *Included in Program Total
Table 2. Affordability Allocation (Excluding Administrative Expenses) Program <30% of AMI <60% of AMI <80% of AMI <120% of
AMI Program Total
1. Below Market Rate
Multifamily Rental
Development Loan
Program
$ 2,340,000 $ 3,217,500 $ 0 $ 0 $ 5,557,500
2. Below Market Rate
Accessory Dwelling
Unit Loan Program
$ 600,000 $ 825,000 $0 $ 0 $ 1,425,000
3. Low Income
Homeowner Rehab
Loan Program
$ 800,000 $1,100,000 $0 $ 0 $ 1,900,000
Total $ 3,740,000 $4,180,000 $0 $ 0 $ 8,882,500
Table 3. Interest Rates for Loans
Program
Interest Rate
for Extremely
Low Income
(<30% AMI)
Interest Rate for Very
Low Income
(<60% AMI)
Interest Rate for 100%
BMR projects
1.Below Market Rate Multifamily
Rental Development Loan
Program
3% 3% 1.5%
2.Below Market Rate Accessory
Dwelling Unit Loan Program 0% 3% n/a
3.Low Income Homeowner Rehab
Loan Program 0% 3% n/a