1 CITY OF GLENDALE, CALIFORNIA
REPORT TO THE JOINT MEETING: GLENDALE CITY COUNCIL AND GLENDALE
HOUSING AUTHORITY
AGENDA ITEM
Report: Adoption of the FY 2025-26 Glendale Housing Authority Budget and Contract Amendments
1) Resolution of the City Council Making Findings and Approving Expenditures of Low Moderate Income Housing Asset Funds for Administration and Planning and Expenditures Outside Redevelopment Project Areas for the FY 2025-26 Housing Authority Budget;
2) Resolution of the Housing Authority Making Findings and Approving Expenditures of Low Moderate Income Housing Asset Funds for Administration and Planning and Expenditures Outside Redevelopment Project Areas for the FY 2025-26 Housing Authority Budget and Adopting the FY 2025-26 Housing Authority Budget; 3) Motion of the Housing Authority to Approve an Amendment to the Professional Services Agreement with Kane, Ballmer and Berkman (Contract C106203) to Increase the Contract Amount by $300,000 for a New “Not to Exceed” Contract of $1,040,000 for Affordable Housing Legal Services; and to Extend the Agreement Term for Two Years to June 30, 2027; and
4) Motion to Approve Amendment to the Servicing Agreement between the Housing Authority of the City of Glendale and Heritage Housing Partners (Contract 8000078), Extending the Agreement Term for Two Years to June 30, 2027.
COUNCIL ACTION
Item Type: Action Item
Approved for June 24, 2025 calendar
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1 EXECUTIVE SUMMARY
Community Development Department, Housing Division presents the Fiscal Year 2025- 26 budget of all Housing funds for consideration and budget adoption.
RECOMMENDATION
Staff recommends Council and Housing Authority adopt the FY 2025-26 budget as presented and make the required findings to utilize funds outside of the Redevelopment Project Areas.
BACKGROUND
The proposed budget for the Glendale Housing Authority is $60,191,386 for FY 2025-
26. The Housing Authority Budget is primarily a grant funded / special revenue specific budget with funding from:
- Federal sources that are received on an annual basis; - Encumbered assets/program income from previous investments of Redevelopment 20% Housing Set Aside funds;
- Development related affordable housing fees including the Affordable Housing Density Bonus fee, City-Wide Inclusionary Housing In-Lieu fee, and the Commercial Development Impact fee; and
- One-time State grant awards.
The Housing Authority has the responsibility for administering the following programs:
-The Housing Assistance Fund (2020) – federal Section 8 Housing Choice Vouchers (HCV), VASH, Mainstream Vouchers for rental assistance to low income households, and Emergency Housing Vouchers (EHV) to assist individuals and families who are homeless, at-risk of homelessness, fleeing, or attempting to flee, domestic violence, dating violence, sexual assault, stalking, or human trafficking, or were recently homeless or have a high risk of housing instability;
-HOME Grant Fund (2030) – federal funds for housing development and preservation activities for low income households;
-Continuum of Care Grant Fund (2040) –federal funds for Supportive services, Rapid Re-Housing, permanent supportive housing, and rental assistance Program, to assist unhoused individuals and families regain housing stability and work towards self-sufficiency;
-Emergency Solutions Grant Fund (2050) – Federal funding for homeless prevention, outreach, emergency shelter essential services, and rapid re- housing, to support those who are at-risk of homelessness currently experiencing homelessness.
-Affordable Housing Trust Fund (2090) – funds received from inclusionary housing fees, affordable housing density bonus fees, and miscellaneous program income to be expended on affordable housing purposes not covered by other restricted state and federal housing funds;
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1 -BEGIN Affordable Homeownership Fund (2120) – State funds for down payment assistance to first time home buyers who are Moderate Income households (currently invested in the Doran Gardens project); -Low & Mod Income Housing Asset Fund (2130) – funds from previous 20% Redevelopment Set Aside funds for housing development and preservation activities (including administration and program delivery) for Low and Moderate Income households, in accordance with State law;
-Miscellaneous Grant Funds (2160) – State grant funds for the Homeless Housing Assistance and Prevention Program (HHAP-5)
-Permanent Local Housing Allocation Fund (2280) – State funds for housing- related projects and programs to address the unmet housing needs in the community; and
-Housing Mitigation Fee Fund (4110) – deposits from the Commercial Development Impact Fee.
Requirement for Findings Related to Former Redevelopment Areas:
Despite substantial changes to the sections of the California Law that apply to Redevelopment (including the dissolution of Redevelopment agencies), some elements of Redevelopment law remain. Redevelopment Project Areas were not eliminated and the requirement remains to approve proposed expenditures of the Redevelopment 20% Set Aside program income (LMIHAF) funds outside the project area as being necessary in order to increase, improve and preserve the supply of affordable housing within the City. Also, the requirement to approve the necessity and appropriateness of the expenditure of LMIHAF funds for administration and planning purposes remains as well.
This has been approved annually in previous year’s budgets and new City Council and Housing Authority resolutions are included in this report to meet those State requirements.
Information Regarding Section 8 HCV, VASH, EHV, and Mainstream Program Expenditures Review:
In preparing the Section 8 federal fund expenditures included in the FY 2025-26 proposed Housing Authority Budget, expenditures have been reviewed for conformance with HUD’s requirements under the Uniform Administrative requirements, Cost Principles, and Audit requirement for Federal Awards.
Contract Amendments
Kane, Ballmer, Berkman (KBB): KBB provides the Housing Authority with specialized affordable housing legal services for affordable housing development projects and specialized programs. These services augment the City Attorney Office's work in this area. The need for these services is based upon the number and complexity of projects in development during the fiscal year. At each stage of development, including negotiations, financing, land acquisition, and construction financing, specialized legal 41 6
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1 services are required to assure that the Housing Authority's interests are protected and that the requirements of State and Federal regulations governing use of Housing Authority funding sources are met. Continuous service by a professional legal services firm is important for quick and effective implementation of housing development projects. The requested amendment is to increase the contract amount by $300,000 for a new “Not to Exceed” $1,040,000 and to extend the agreement term for two years.
Heritage Housing Partners (HHP): HHP is a nonprofit affordable housing developer that developed the 57-unit Doran Gardens affordable homeownership housing development. The units were sold to qualified, moderate-income, first-time home buyers at a restricted sales price, relative to their income and the requirements of redevelopment set aside law. The project was designed to restrict all future sales of the units under the same criteria so that the affordability of these units continues to subsequent buyers for 45 years. This is accomplished through a First Right of Refusal option incorporated into the covenants of the units. As a result, there is a significant amount of loan servicing requirements and demands associated with managing a portfolio of this size and complexity.
When a homeowner is interested in selling a unit, they must notify the City/HHP of their intent and the City must exercise that right within a certain number of days. The City/HHP must then either market and find a qualified replacement buyer to purchase the unit at a restricted sales price directly from the seller within a specific timeframe, or must purchase the unit at the restricted sales price, and then market the units for resale at a timeline of its choosing. This process includes taking title to property, possibly making needed repairs and upgrades to the units, managing and financing of the unit during the holding period, and then marketing and eventually reselling the units. These are all complex functions that require quick responses to the buyers within a limited timeframe.
As a condition of the initial funding of the development, HHP was required to perform loan servicing functions for the units for the first five years and the responsibility of those functions then was supposed to shift back to the Housing Authority. Recognizing the complexity of these specialized loan servicing needs, a Professional Services Agreement for the ongoing services was established with HHP. A line of credit was provided at $1.2M. This line of credit funds the interim purchase of homes, when necessary, and is largely repaid through an eventual resale of the units. HHP will be paid for their services via a 6% commission based on the contract price for the home.
HHP is responsible for all transaction costs (i.e., holding costs, escrow, etc.). The contract extension is proposed for two more years.
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1 ANALYSIS
This is a fiscally responsible budget, meeting Council’s goal of providing quality housing to the Glendale community. The presented budget, findings, and contract amendment will allow the Housing division to continue to successfully administer a robust Housing program.
STAKEHOLDERS/OUTREACH
Not applicable.
FISCAL IMPACT
This report presents the annual proposed FY 2025-26 Housing Budget of $60,191,386 to the Glendale Housing Authority for adoption. In addition to the special revenue funds, Homeless Services also includes $543,440 in General Fund dollars which will be included in the Citywide Budget Adoption process.
ENVIRONMENTAL REVIEW (CEQA/NEPA)
Not applicable.
CAMPAIGN DISCLOSURE
The names and business addresses of the members of the board of directors, the chairperson, CEO, COO, CFO, Subcontractors and any person or entity with more than 10% interest in the company proposed for contract in this Agenda Item Report are attached in Exhibit 1, in accordance with the City Campaign Finance Ordinance No. 5744.
ALTERNATIVES
Alternative 1: City Council and Housing Authority make findings and approve expenditures of the LMIHA Funds for administration and planning and expenditures outside Redevelopment Project Areas for the FY 2025-26 proposed Housing Authority Budget, the FY 2025-26 budget, and contract amendments.
Alternative 2: Disapprove the proposed findings and expenditures of the funds from LMIHAF for administration and planning and expenditures outside Redevelopment Project Areas for the FY 2025-26 proposed Housing Authority Budget, and may disapprove the FY 2025-26 proposed Housing Authority Budget and contract amendments, this will prohibit the Housing programs from continuing.
Alternative 3: The City Council and Housing Authority may consider any other alternative not proposed by staff.
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1 ADMINISTRATIVE ACTION
Submitted by:
Bradley Calvert, Director of Community Development
Prepared by:
Tamar Sadd, Deputy Director of Community Development
Approved by:
Roubik R. Golanian, P.E., City Manager
EXHIBITS/ATTACHMENTS
Exhibit 1: Campaign Disclosures
Exhibit 2: FY 2025-26 Glendale Housing Authority Budget Summary