MO!! ON
Moved by Council Member ___ K_a_s_s_a_k_hi_a_n _______ _ seconded by Council Member _____ G_ha_r~p_et_ia_n ________ , that the Fiscal Year 2023-24 Low and Moderate Income Housing Asset Fund (LMIHAF) Annual Report, attached as Exhibit 1 to the Joint Report to the Council and Housing Authority dated December 17, 2024 and incorporated herein by reference, is hereby noted and filed.
Vote as follows:
Ayes:
Noes:
Abstain:
Absent:
Brotman, Gharpetian, Kassakhian, Najarian, Asatryan
None
None
None
THE MOTION WAS ADOPTED AT THE JOINT CITY COUNCIL AND HOUSING AUTHORITY MEETING OF:
TUESDAY, DECEMBER 17, 2024.
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CITY OF GLENDALE, CALIFORNIA
REPORT TO THE JOINT MEETING: GLENDALE CITY COUNCIL AND
GLENDALE HOUSING AUTHORITY
AGENDA ITEM
Report: Request to Note and File the FY 2023-24 Low and Moderate Income Housing Asset Fund (LMIHAF) Annual Report.
1. City Council Motion to Note and File the FY 2023-24 LMIHAF Annual Report in accordance with California Health & Safety Code 34176.1(f).
COUNCIL ACTION
EXECUTIVE SUMMARY
State Law requires jurisdictions to annually report on deposits and expenditures into the Low and Moderate Income Housing Asset Fund. The report also provides information on the results of required tests that demonstrate who benefits from the fund. Staff reports the information each year to the City Council and Housing Authority, and posts the information on the City's website.
Item Type: Action Item
Approved forDecember 17, 2024 calendar
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RECOMMENDATION
That the City Council approve a motion to Note and File the FY 2023- 24 Low and Moderate Income Housing Asset Fund (LMIHAF) Annual Report. This Annual Report is required by the State of California Health & Safety Code sections related to the dissolution of Redevelopment.
ANALYSIS
The FY 2023-24 LMIHAF Annual Report is being provided to the City Council and Housing Authority as required by State law. The LMIHAF is the name of the fund that received housing assets transferred from the 20% Redevelopment Housing Set Aside Fund to the Housing Authority with the dissolution of Redevelopment. State law also requires an independent financial audit of the LMIHAF within 6 months of the end of the fiscal year.
This audit is included in the FY 2023-24 Glendale Annual Comprehensive Financial Report (ACFR) that will be submitted to the City Council at their evening meeting on December 17, 2024. Information in the ACFR was used to prepare this LMIHAF Annual Report.
There are 13 items included in the report, including information on financial deposits, expenditures, and transfers into and out of the fund; the year end fund balance and value of property held within the fund; and the fact that at year end there was not an “excess surplus” condition in the fund. Shown below are some noteworthy items in the report.
Deposits: In FY 2023-24 $263,171 was deposited into the fund. The source of deposits were monthly payments from borrowers under the City’s First Time Homebuyer Program and Interest Income.
Fund Balance: As of June 30, 2024 the LMIHAF balance was approximately $4.3 million dollars.
Expenditures: Approximately $1.5M was expended in FY 2023-24 for projects and administration. The largest expense was a combined $1M in construction costs for Citrus Crossing (900 E Broadway) and Harrower Village (920 E Broadway).
Extremely Low Income Housing State law requires that the Authority must expend at least 30% of the LMIHAF for development of rental housing affordable to and occupied by households earning 30% or less of the AMI. If the Authority fails to comply with the Extremely-Low Income requirement in any five-year report, then the Authority must ensure that at least 50% of the funds remaining in the LMIHAF be expended in each fiscal year following the latest fiscal year following the report until the Authority demonstrates compliance with the Extremely-Low Income requirement.
Of the 116 affordable units funded with LMIHAF, 19 were reserved for extremely low income households. That amounts to 16% of the funding, well below the 30% minimum.
Therefore, the next affordable housing project(s) will have to target extremely low income households at a rate of 50% of the Authority’s LMIHAF until the Authority is in compliance with the Extremely Low Income requirement.
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Senior Housing: The “Senior Housing Test” in the report requires calculating the percentage of senior rental housing assisted by the City and Housing Authority using any resources during the last ten years (January 1, 2014 through January 1, 2024) as compared to all rental housing assisted during that time. Glendale passed this “test” and so use of LMIHAF for affordable senior citizen units is not restricted in the next year.
According to State law the percentage of senior rental housing assisted by the City must remain below 50% of all housing. If senior units exceed 50% future LMIHAF cannot be spent until the percentage reduces below that level. The test for this ten-year period shows that 44% (339 of 764 units) of affordable rental housing constructed during the ten years was senior housing. Over the history of the affordable housing program in Glendale, 823 of 1,415 affordable units assisted (58%) are restricted to seniors. An additional 440 affordable units are currently in construction or predevelopment phase, of which 197 units (approximately 45%) are restricted to seniors.
First Time Home Buyer (FTHB) Loans: An inventory of 20% Redevelopment Set Aside assisted homeownership units originated prior to February 1, 2012 and their current status is required. The annual report also must state whether any of these units were lost as affordable housing in the last year. The report shows that 110 LMIHAF homeownership units that were restricted as affordable prior to February 1, 2012 were still restricted in FY 2023-24. None of these units were lost during the reporting period..
STAKEHOLDERS/OUTREACH
As required by State law, the LMIHAF Annual Report will be posted on the Community Development Department website prior to December 31, 2024 following presentation of the report to the City Council and Housing Authority.
FISCAL IMPACT
There is no fiscal impact associated with this report.
ENVIRONMENTAL REVIEW (CEQA/NEPA)
Staff has determined that the activity of noting and filing this report is exempt from further environmental review under the California Environmental Quality Act (“CEQA”) pursuant to Title 14 of the California Code of Regulations (“CEQA Guidelines”) Section 15061(b)(3), as the mere acceptance of a report on deposits and expenditures into the Low and Moderate Income Housing Asset Fund will not allow for or promote physical changes in the environment and, therefore, it can be seen with certainty that there is no possibility that the activity may have a significant effect on the environment. Further, the activity is arguably not a Project under CEQA and is therefore not subject to CEQA review pursuant to CEQA Guidelines, Sections 15378(a) & 15378(b)(4), because it does not have a potential for resulting in either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment, and because it constitutes creation of a government funding mechanism or governmental fiscal activity that does not involve any commitment to any specific project which may result in a potentially significant physical impact on the environment.
CAMPAIGN DISCLOSURE
This item is exempt from campaign disclosure requirements. 4 {{section.number}}1
ALTERNATIVES
Alternative 1: Elect to approve the motion to note and file the FY 2023-24 Annual LMIHAF report.
Alternative 2: Do not approve the motion to note and file the report. It is a requirement of State law that this report be prepared, presented to the City Council, and posted on the City website.
Alternative 3: The City Council and Housing Authority may consider any other alternative not proposed by staff.
ADMINISTRATIVE ACTION
Submitted by:
Bradley Calvert, Director of Community Development
Prepared by:
Peter Zovak, Assistant Director of Community Development Michael Fortney, Principal Housing Project Manager
Pamela Jackson, Housing Coordinator
Approved by:
Roubik R. Golanian, P.E., City Manager
EXHIBITS/ATTACHMENTS
Exhibit 1: Housing Successor Annual Report Regarding the Low and Moderate Income Housing Asset Fund for Fiscal Year 2023-24
Housing Successor Annual Report FY 2023-24
1 Housing Successor Annual Report Regarding the
Low and Moderate Income Housing Asset Fund
For Fiscal Year 2023-24
Pursuant to California Health and Safety Code Section 34176.1(f) For the Housing Authority of the City of Glendale
This Housing Successor Annual Report (Report) regarding the Low and Moderate Income Housing Asset Fund (LMIHAF) has been prepared pursuant to California Health and Safety Code Section 34176.1(f) and is dated December 17, 2024.
This Report sets forth certain details of the activities of the Housing Authority of the City of Glendale (Authority) acting as Housing Successor during Fiscal Year 2023-24 (Fiscal Year).
The purpose of this Report is to provide the governing body of the Authority an annual report on the LMIHAF housing assets and activities of the Authority under Part 1.85, Division 24 of the California Health and Safety Code, in particular sections 34176 and 34176.1 (Dissolution Law).
The following Report is based upon information prepared by Glendale’s Housing Successor staff (City Finance Department and Community Development Department staff) and information contained within the independent financial audit of the Low and Moderate Income Housing Asset Fund in the City of Glendale Annual Comprehensive Financial Report for Fiscal Year 2023-24 (Fiscal Year) as prepared by CliftonLarsonAllen LLP, which Audit is separate from this annual summary Report. Further, this Report conforms with and is organized into Sections I. through XIII, inclusive, pursuant to Section 34176.1(f) of the Dissolution Law:
I. The amount the city, county, or city and county received pursuant to subparagraph (A) of paragraph (3) of subdivision (b) of Section 34191.4:
A total of $263,171 was deposited into the LMIHAF during the Fiscal Year. The City did not receive any other City Agency loan repayment amounts in FY 2023-24 pursuant to this section.
II. Amount Deposited into LMIHAF: This section provides the total amount of funds deposited into the LMIHAF during the Fiscal Year. Any amounts deposited for items listed on the Recognized Obligation Payment Schedule (ROPS) must be distinguished from the other amounts deposited.
A total of $263,171 was deposited into the LMIHAF during the Fiscal Year.
III. Ending Balance of LMIHAF: This section provides a statement of the balance in the LMIHAF as of the close of the Fiscal Year. Any amounts deposited for items listed on the ROPS must be distinguished from the other amounts deposited.
At the close of the Fiscal Year, the ending balance in the LMIHAF was $4,274,524.
Housing Successor Annual Report FY 2023-24
2 IV. Description of Expenditures from LMIHAF: This section provides a description of the expenditures made from the LMIHAF during the Fiscal Year. The expenditures are to be categorized. Note: These expenses are not itemized in the annual Audit.
LMIHAF Expenditures 2023-24
Monitoring and Administration Expenditures $ 520,859
Homeless Prevention and Rapid Rehousing Services
Expenditures
$ -
Housing Development Expenditures
- For Low Income Units $ 527,930
- For Very Low Income Units $ 311,438
- For Extremely Low Income Units $ 164,300
TOTAL LMIHAF Expenditures in Fiscal Year *see note below $ 1,524,527
V. Statutory Value of LMIHAF Assets Owned by Authority: This section provides the statutory value of LMIHAF real property owned by the Authority, the value of loans and grants receivables, and the sum of these two amounts.
Statutory Value of LMIHAF Real Property Owned by
Authority $ 29,590,491
Value of LMIHAF Loans and Grants Receivable $ 87,336,473 Total Value of Authority LMIHAF Assets $ 116,926,964
VI. Description of Transfer: This section describes transfers, if any, to another housing successor agency made in previous Fiscal Year(s), including whether the funds are unencumbered and the status of projects, if any, for which the transferred LMIHAF will be used. The sole purpose of the transfers must be for the development of transit priority projects, permanent supportive housing, housing for agricultural employees or special needs housing.
The Authority did not make any LMIHAF transfers to other Housing Successor(s) under Section 34176.1(c) (2) during the Fiscal Year.
VII. Project Descriptions: This section describes any project for which the Authority receives or holds property tax revenue pursuant to the ROPS and the status of that project.
The Authority did not receive or hold property tax revenue pursuant to the ROPS during the Fiscal Year.
VIII. Status of Compliance with California Health & Safety Code Section 33334.16:
This section provides a status update on compliance with Section 33334.16 for interest in LMIHAF real property acquired by the former redevelopment agency prior to February 1, 2012.
Housing Successor Annual Report FY 2023-24
3 With respect to interests in real property acquired by the former redevelopment agency prior to February 1, 2012, the time periods described in Section 33334.16 shall be deemed to have commenced on the date that the Department of Finance approved the property as a housing asset in the LMIHAF; thus, as to real property acquired by the former redevelopment agency now held by the Authority in the LMIHAF, the Authority must initiate activities consistent with the development of the real property for the purpose for which it was acquired within five years of the date the DOF approved such property as a housing asset.
Following is a status update on the LMIHAF real property or properties housing asset(s) that were acquired prior to February 1, 2012 and compliance with five-year period:
Address of
LMIHAF
Property
Date of
Acquisition
Deadline to Initiate
Development
Activity
Status of Authority
Activity
1416 5th Street
(5th & Sonora)
October 2008
n/a
Multifamily rental
apartments in
operation.
1814 Vassar Ave May 2009 n/a
Multifamily rental
apartments in
operation
3673 San
Fernando February 2008 n/a
Multifamily rental
apartments in
operation
328 Mira Loma
February 2007
n/a
Multifamily rental
apartments in
operation
630 Geneva
May 2006
n/a
Open space,
undevelopable,
accessory to Habitat
Geneva Homes
1855 Brand/1760
Gardena March 2005 n/a
Multifamily rental
apartments in
operation
555 E Palmer FY 1993 n/a
Multifamily rental
apartments in
operation
Section 34176.1 provides that Section 33334.16 does not apply to interests in LMIHAF real property acquired by the Authority on or after February 1, 2012; however, this Report presents an information only status update on LMIHAF projects related to such real property.
Housing Successor Annual Report FY 2023-24
4 The following table shows LMIHAF properties that were acquired after February 1, 2012 and their status:
Address of
Property
Date of
Acquisition
Deadline to Initiate
Development
Activity
Status of Authority
Activity
327-331 Salem
Street - Parking
Lot 12
November 2013
n/a
Veterans Village
Project – Multi-Family
rental apartments in
operation 11/15/2015.
515 Pioneer
Avenue
December 2019 n/a
Land purchased.
Project is in
construction phase.
426 Piedmont
Ave/507Naranja
Drive
September 2022
n/a
Land purchased.
Project is in pre
development phase.
IX. Description of Outstanding Obligations under Section 33413: This section describes the outstanding inclusionary and replacement housing obligations, if any, under Section 33413 that remained outstanding prior to dissolution of the former redevelopment agency as of February 1, 2012 along with the Authority’s progress in meeting those prior obligations, if any, of the former redevelopment agency.
Replacement Housing Obligation:
According to the 2010-2014 Implementation Plan (Plan) for the former redevelopment agency:
There were no replacement housing obligations that were outstanding that were transferred to the Authority.
As noted in the Plan, the Authority met the obligations for replacement of the units that were listed. These replacement housing obligations were met (in terms of number of bedrooms and by affordability levels) either through onsite replacement of the units or through relying on the excess affordable residential units constructed within the required time frame as noted in the Glendale Housing Inclusionary and Replacement Bank spreadsheet maintained by the Community Development Department Housing Division.
There were no additional projects that incurred replacement obligations between the date the Plan was written (July 2009) and the dissolution of the Glendale Redevelopment Agency on February 1, 2012.
Inclusionary/Production Housing Obligation:
According to the Plan for the former redevelopment agency:
No Section 33413(b) inclusionary/production housing obligations were transferred to the Authority.
Housing Successor Annual Report FY 2023-24
5 As noted in the Plan, the Authority met the obligations for production of affordable housing that had resulted from construction of new residential units listed in the Plan. (Note: Some development projects listed in the Plan did not go forward.)
Production housing obligations were met (in terms of number of units and by affordability levels) either through onsite replacement of the units or through relying on the excess affordable residential units of appropriate affordability levels that were constructed within the required time frame as noted in the Glendale Housing Inclusionary and Replacement Bank spreadsheet.
There were no additional projects that incurred housing production obligations between the date the Plan was written (July 2009) and the dissolution of the Glendale Redevelopment Agency on February 1, 2012.
The former redevelopment agency’s Implementation Plans are posted on the City’s website at http://www.glendaleca.gov/government/departments/glendale- economic-development-corporation-/glendale-successor-agency/implementation- plan .
X. Extremely Low Income Test: This section provides the information required by Section 34176.1(a)(3)(B), or a description of expenditures by income restriction for a five year period, with the time period beginning January 1, 2014 and whether the statutory thresholds have been met.
Section 34176.1(a)(3)(B) requires that the Authority must require at least 30% of the LMIHAF to be expended for development of rental housing affordable to and occupied by households earning 30% or less of the AMI. If the Authority fails to comply with the Extremely-Low Income requirement in any five-year report, then the Authority must ensure that at least 50% of the funds remaining in the LMIHAF be expended in each fiscal year following the latest fiscal year following the report until the Authority demonstrates compliance with the Extremely-Low Income requirement.
Extremely Low Income Test January 1, 2019 to January 1, 2024 Number of Assisted Extremely Low
Income Units 19
Number of Total Assisted Units 116
Extremely Low Income Percentage 16%
XI. Senior Housing Test: Glendale passes this test and so use of LMIHAF is not restricted in the next year due to this requirement.
This section provides the percentage of units of deed-restricted rental housing restricted to seniors and assisted individually or jointly by the Authority, its former Redevelopment Agency, and its host jurisdiction within the previous 10 years in relation to the aggregate number of units of deed-restricted rental housing assisted individually or jointly by the Authority, its former Redevelopment Agency and its host jurisdiction within the same period.
The Authority is to calculate the percentage of units of deed-restricted rental housing restricted to seniors and assisted by the Authority, the former redevelopment agency Housing Successor Annual Report FY 2023-24
6 and/or the City within the previous 10 years in relation to the aggregate number of units of deed-restricted rental housing assisted by the Authority, the former redevelopment agency and/or City within the same time period.
If this percentage exceeds 50%, then the Authority cannot expend future funds in the LMIHAF to assist additional senior housing units until the Authority or City assists and construction has commenced on a number of restricted rental units that is equal to 50% of the total amount of deed-restricted rental units.
For this Report the ten year period reviewed is January 1, 2014 to January 1, 2024.
Glendale Senior Housing Test January 1, 2014 to January 1, 2024 Number of Assisted Senior Rental Units 339
Number of Total Assisted Rental Units 764
Senior Housing Percentage 44%
NOTE: 502 of 780 units listed above were in construction within the reporting period.
XII. Excess Surplus Test: This section provides the amount of excess surplus in the LMIHAF, if any, and the length of time that the Authority has had excess surplus, and the Authority’s plan for eliminating the excess surplus.
Excess Surplus is defined in Section 34176.1(d) as an unencumbered amount in the account that exceeds the greater of one million dollars ($1,000,000) or the aggregate amount deposited into the account during the Authority’s preceding four Fiscal Years, whichever is greater.
Excess Surplus test for FY 2023-24:
Fund Balance - as of 6-30-2024 $4,274,524
Less unavailable funds - as of 6-30-2024
Land held for resale -
Loans receivable -
Total unavailable funds -
Unencumbered fund balance - as of 6-30-2024 $4,274,524
Deposits for the preceding four fiscal years:
Fiscal year 2019-20 $1,223,644
Fiscal year 2020-21 $2,798,979
Fiscal year 2021-22 $1,053,035
Fiscal year 2022-23 $779,814
$5,855,472
Test Result: The LMIHAF does not have an Excess Surplus.
Housing Successor Annual Report FY 2023-24
7 XIII. Homeownership Units: This section provides an inventory of homeownership units assisted by the former redevelopment agency or the housing successor that are subject to covenants or restrictions or to an adopted program that protects the former redevelopment agency’s investment of moneys from the LMIHAF pursuant to subdivision 34176.1 (f) (13) and Section 33334.3 (f) of the California Health and Safety Code for 2023-24:
a. Number of First Time Home Buyer Units with LMIHAF Loans originated before 2/1/2012 that were active in 2023-24: 110 Loans
b. Number of these loans “lost” between 7/1/2023 through 6/30/2024 and reasons for loss:
NONE
.
c. Funds returned to the Authority as part of the asset management program protecting the investment of moneys from the LMIHAF for the First Time Home Buyer Program:
NONE
d. Contracted entity for management of the units:
Limited loan servicing provided for portion of portfolio (loans with monthly payments) through Community Reinvestment Fund.
Submittal and Publication of Report:
This Report will be provided to the Housing Successor’s (Authority) governing body by December 31, 2024. In addition, this Report and the former redevelopment agency’s pre- dissolution Implementation Plans will both be made available to the public on the City’s website.