2646873v6 - updated 01/13/2021
APPROVED AS TO FORM AND LEGALITY
___________________________________
CITY ATTORNEY’S OFFICE
OAKLAND CITY COUNCIL
RESOLUTION NO. _______________ C.M.S.
A RESOLUTION (1) ALLOCATING MEASURE U HOUSING BOND
FUNDS IN A TOTAL AMOUNT NOT TO EXCEED $22,000,000 TO FUND
NEW CONSTRUCTION OF MULTIFAMILY RENTAL AFFORDABLE
HOUSING PROJECTS, (2) AUTHORIZING THE CITY ADMINISTRATOR
TO MAKE DEVELOPMENT LOANS UNDER THE NEW CONSTRUCTION
OF MULTIFAMILY RENTAL AFFORDABLE HOUSING PROGRAM
WITHOUT RETURNING TO COUNCIL , CONTINGENT ON FUNDING
AVAILABILITY, AND (3) MODIFYING ALLOCATIONS OF PRIOR
CALIFORNIA DEPARTMENT OF HOUSING & COMMUNITY
DEVELOPMENT’S (CA HCD) L OCAL HOUSING TRUST FUND
AWARDS TO COMPLY WITH STATE PROGRAM REQUIREMENTS
WHEREAS, on January 31, 2023, the City of Oakland issued a Notice of Funding Availability (“NOFA”) soliciting applications for funding for new construction of affordable housing development projects; and
WHEREAS, the application period for the aforementioned NOFA closed on April 3, 2023; and
WHEREAS, the City's Consolidated Plan for Housing and Community Development indicates that there is a need for affordable rental housing, and has identified this activity as a priority; and
WHEREAS, the projects that applied for funding through the NOFA must be consistent with the City’s Project Development Guidelines, and each developer must meet the City’s Threshold Developer Criteria in order to qualify for funding; and
WHEREAS, the projects that applied for funding through the NOFA were evaluated and scored on criteria specified in the NOFA , and the highest ranked projects received approximately $70,000,000 to build 623 affordable housing units; and
WHEREAS, City funding commitments through the NOFA process are critical for affordable housing developers to secure other sources of affordable housing funding from County , State and Federal sources , and the NOFA’s established funding priorities s ought to align with both the City’s funding priorities for affordable housing spending and those of other funders; and
Lesley Casto (Jan 31, 2024 15:08 PST)
Lesley Casto
2 WHEREAS, unfunded affordable housing pipeline projects from the 2023 New Construction NOFA sought approximately $123 million; and
WHEREAS, peer cities often use previously established rankings from competitive Notices of Funding Availability to fu nd projects as additional funds become available; and
WHEREAS, the 2022 Affordable Housing and Infrastructure Bond (Measure U) was adopted by the Oakland voters in November 2022, and authorized the City of Oakland to issue $350 million in General Obligation Bonds to support affordable housing; and
WHEREAS, the second issuance of the bonds authorized by Measure U is expected to take place in late 2024 or early 2025; and
WHEREAS, pursuant to Section 3(C) of Measure U, prior to issuance of the bonds, Council must identify how the projects authorized for funding with Measure U bond proceeds address social and geographic equity and provide greater benefit to underserved populations and geographic areas of greatest need, address improvements to the City’s existing core capital assets, and maintain or decrease the City’s existing operations and maintenance costs; and
WHEREAS, the City is the Lead Agency for these projects for purposes of environmental review under the California Environmental Quality Act of 1970 ("CEQA"); and
WHEREAS, the requirements of CEQA, the CEQA Guidelines as prescribed by the Secretary for Resources, and the provisions of the Environmental Review Regulations of the City of Oakland have been satisfied or will be satisfied for these projects prior to the City making a funding commitment to projects; and
WHEREAS, for those projects receiving federal funds, execution of loan documents or other documents legally committing the City to fund the projects shall be expressly conditioned on compliance with the requirements of the National Environmental Protection Act ("NEPA"), as certified by the City Administrator or his or her designee; and
WHEREAS, the City was awarded Local Housing Trust Funds (“LHTF”) from CA HCD pursuant to CA HCD Notices of Funding Availability dated April 30, 2020, Ma y 3, 2021, and April 5, 2022; and
WHEREAS, pursuant to City Council Resolution No. 88212 C.M.S., dated July 14, 2020, No. 88765 C.M.S., dated July 20, 2021, and No. 89187 C.M.S., dated May 17, 2022, a portion of the LHTF award funds were allocated to specific projects; and
WHEREAS, in order to meet LHTF program requirements, it is in the best interest of the City to allow the City Administrator, in their discretion, to reallocate the LHTF award funds among affordable housing projects funded through the 2023 New Construction NOFA or other past funding processes; now, therefore, be it
3 RESOLVED: That, in addition to the $70,000,000 in funds previously allocated to eligible applic ants to the 2023 New Construction N otice of Funding Availability, the City Council hereby allocates up to an additional $22,000,000 in Measure U Bond funding contingent on the issuance and sale of Measure U Bonds in a sufficient amount and approval of the final project funding authorization legislation; and be it
FURTHER RESOLVED: That the City Council hereby authorizes the City Administrator to provide loans in a total amount not to exceed $22,000,000, to be used for development of new construction affordable housing projects that are selected by the City Administrator as a potential recipient through the 2023 New Construction Notice of Funding Availability, whether or not they received any previous funding award, without returning to Council; and be it
FURTHER RESOLVED: That the City Council hereby authorizes the City Administrator to issue commitments for funding of up to $22,000,000 in proceeds from the next expected available sale of Measure U bonds in Fiscal Year 2024-2025; and be it
FURTHER RESOLVED: That the City Administrator , at their discretion, may reallocate funds from the Local Housing Trust Fund among affordable housing projects, including projects for which LHTF funds wer e previously allocated by the City Council; and be it
FURTHER RESOLVED: That the making of each loan shall be contingent on the availability of sufficient funds in the above funds in fiscal years 2023-24 and/or 2024- 2025; and be it
FURTHER RESOLVED: That each loan shall be for a maximum term of 55 years, with an interest rate to be determined by the City Administrator in his or her discretion, with repayment to the City from surplus cash flow from the project and other available funds during the term of the loan, with the balance due at the end of the term, or on such other repayment terms and schedule as the City Administrator determines are in the best interests of the City and the project; and be it
FURTHER RESOLVED: That as a condition of each loan, the City will require that appropriate restrictions on project occupancy, rents and operations be recorded against project land and/or improvements; and be it
FURTHER RESOLVED: That each loan shall be secured by a deed of trust on the project land and/or improvements; and be it
FURTHER RESOLVED: That loan funds shall be reserved for a period of no more than 24 months from the date of the commitment letter, and shall be s ubject to reprogramming at the end of this period unless the developer has secured commitments for full project funding or provided other assurances of adequate project funding that the City
4 Administrator deems sufficient within his or her discretion, within the reservation period; and be it
FURTHER RESOLVED: That the making of each loan shall be contingent on and subject to such other appropriate terms and conditions as the City Administrator may establish; and be it
FURTHER RESOLVED: That the City hereby authorizes the City Administrator in his or her discretion to subordinate the priority of any of the City’s recorded interests in each project property to a lien or encumbrance of another private or governmental entity providing financial assistance to the project, if the City Administrator or his or her designee determines that (1) an economically feasible alternative method of financing the project on substantially comparable terms and conditions but without subordination is not reasonably available, (2) the City’s investment in the project in the event of default is reasonably protected, and (3) subordination is in the best interests of the City; and be it
FURTHER RESOLVED: That the Ci ty Council hereby authorizes the City Administrator to make specific allocations of the loan funds approved under this Resolution among the projects without returning to Council; and be it
FURTHER RESOLVED: That the City Council finds and determines that the New Construction of Multifamily Rental Affordable Housing Program funded by this Resolution (1) will address social and geographic equity and provide greater benefit to underserved populations and geographic areas of greatest need by increasing the stock of affordable rental housing with long-term affordability restrictions throughout Oakland; (2) will not impact the City’s existing core capital assets, but may provide collateral improvements to such assets as part of project development; and (3) will not impact the City’s existing operations and maintenance costs, since the operations and maintenance cost of the projects will be covered by the property owner; and be it
FURTHER RESOLVED: That the City Council finds and determines that this action is not subject to CEQA since it is not funding any specific projects, but that the City Administrator will make the environmental determinations under CEQA for each project that is selected prior to making a loan; and be it
FURTHER RESOLVED: That the City Administrator shall cause to be filed with the County of Alameda a Notice of Exemption or Notice of Determination for each project as appropriate; and be it
FURTHER RESOLVED: That execut ion of loan documents or other documents legally committing the City to fund a project with federal funds will be expressly conditioned on compl iance with the requirements of NEPA, as certified by the City Administrator; and be it
FURTHER RESOLVED: That all loan documents shall be reviewed and approved by the City Attorney’s Office for form and legality prior to execution; and be it
5 FURTHER RESOLVED: That the City hereby authorizes the City Administrator to determine funding allocations, conduct negotiations, execute documents, administer the loans, extend or modify the repayment terms, and take any other action with respect to the loans, funding allocations, and the projects consistent with this Resolution and its basic purpose.
IN COUNCIL, OAKLAND, CALIFORNIA,
PASSED BY THE FOLLOWING VOTE:
AYES -
FIFE, GALLO, JENKINS, KALB, KAPLAN, RAMACHANDRAN, REID, AND
PRESIDENT FORTUNATO BAS
NOES –
ABSENT –
ABSTENTION –
ATTEST:
ASHA REED
City Clerk and Clerk of the Council of the
City of Oakland, California