View Legislation — Oakland City Council, December 9, 2024

APPROVED AS TO FORM AND LEGALITY

___________________________
CITY ATTORNEY’S OFFICE

OAKLAND CITY COUNCIL

ORDINANCE NO. ________________C.M.S.

ORDINANCE AMENDING OAKLAND MUNICIPAL CODE CHAPTER

15.62 “AFFORDABLE HOUSING TRUST FUND” TO ALLOW FUNDS

DISTRIBUTED TO THE CITY UNDER REDEVELOPMENT

DISSOLUTION LAWS TO BE US ED FOR ANY LAWFUL PURPOSE

UPON A DECLARATION OF EXTREME FISCAL NECESSITY BY THE

CITY COUNCIL

WHEREAS, Oakland Municipal Code (“OMC” ) Chapter 15.62 establishes the Affordable Housing Trust Fund; and

WHEREAS, a portion of the funds in the Affordab le Housing Trust Fund are a set-aside of 25% of funds distributed to the City as a taxing entity under the laws dissolving redevelopment agencies; and

WHEREAS, OMC section 15.62.040 provides that the funds in the Affordable Housing Trust Fund shall be used only for specified purposes; and

WHEREAS, the City Administrator recommends that the requirements of Oakland Municipal Code (“OMC”) Chapte r 15.62 are suspended upon a decl aration of extreme fiscal necessity by the City Council so that the Affordable Housing Tr ust Fund revenue may be used for any lawful government purposes as provided in the Ordinance adopted by the voters; and

WHEREAS, pursuant to Resolution No. 90327 C.M. S., the City Council declared an extreme fiscal necessity for the fiscal year 2024-2025 budget cycle; now, therefore, be it

WHEREAS, the City Administrat or recommends amendi ng OMC section 15.62.040 to allow the portion of funds in the Affordable Housing Trust Fund that come from funds distributed to the City as a taxing entity under the redevelopment dissolution to be used for any lawful purpose upon a declaration of fiscal necessity by the City Council

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF OAKLAND DOES ORDAIN AS FOLLOWS:

SECTION 1. Amendments to Section 15.6 2.040 of the Oakland Municipal Code.

Oakland Municipal Code section 15.62.040, “Use of Funds”, is hereby amended to read as 2 follows (deleted text is indicated with strike out text, and added text is indicated with double underline text):

15.62.040 Use of Funds

A. Funds deposited into the Affordable Housing Trust Fund, and all interest and investment earnings thereon, shall be used to increase, improve, and preserve the supply of affordable housing in the City, with priority given to housing for very low income households. For purposes of this paragraph, to "preserve" affordable housing means to acquire, finance, refinance, or rehab ilitate housing that is at imminent risk of loss to the affordable housing supply (including housing that is restricted to affordable ho using or housing that is otherwise provided at an affordable rent or an affordable housing co st to lower income households or very low income ho useholds) due to terminat ion of use restrictions, non-renewal of subsidy contract, mortgage or tax default or foreclosure, rent increases, conversion to market-rate housing or other uses , demolition, or physical co nditions that are li kely to result in vacation of the property.

Funds may also be us ed to cover reasonable administrative or related expenses of the City not reimbursed through processing fees. No portio n of the Affordable Housing Trust Fund may be diverted to other purposes by way of loan or otherwise.

Funds in the Affordable Housin g Trust Fund shal l be used in accordan ce with the adopted housing element to the City's General Plan, the C onsolidated Plan, an d subsequent housing plans adopted by th e City Council, to subsid ize or assist the City, other government entities, nonprofit organization s, private organizat ions or firms, or indivi duals in the construction, preservation or substantial reha bilitation of afford able housing. Monies in the Affordable Housing Trust Fund may be disbursed, hypothecat ed, collateralized or otherwise employed for these purposes from time to tim e as the City Administrator so determines is appropriate to accomplish the purposes of the Affordable Housi ng Trust Fund. Eligible uses include, but are not limited to, assistance wi th staff costs or other administrative costs attributable to a specific affordable housing project, equity participation in affo rdable housing projec ts, loans and grants (including, predevelop ment loans or grants ) to affordable housi ng projects, or other public/private partnership arrang ements. Monies from the Affo rdable Housing Trust Fund may be extended for the benefit of rental housing, owner occupied housing, limited equity cooperatives, mutual housing deve lopments, or other types of af fordable housing projects. Not more than fifteen percent (15%) of the funds deposited into the Affordable Housing Trust Fund from Affordable Housing Impact Fees may be used fo r housing affordable to moderate income households unless this limi t is waived by the City Council with a specific finding that the waiver is in the best interests of the City.

B. Notwithstanding the prov isions of Subsection A. abov e, funds deposited into the Affordable Housing Trust Fund fr om fines and penalties received under the Foreclosed and Defaulted Residential Property Registration Pr ogram pursuant to Sect ion 8.54.620 of this Code, or from fines, penalties, or other funds under other programs that designate the use of funds deposited into the Affordable Housin g Trust Fund for forecl osure prevention or mitigation purposes, ma y be used for foreclosure prevention and mitigation activities, including but no t limited to homebuyer or tenant assist ance, rehabilitation, hou sing counseling, 3 education, outreach, and advocacy activities, along with staff costs or other administrative costs attributable to such activities. Upon a finding by th e City Council or the City Administrator that funds are no longer needed fo r foreclosure prevention or mitigation activities, such funds ma y also be used for othe r eligible Affordable Housing Trust Fund uses or for other low income or very low income te nant or homebuyer assi stance. Funds received pursuant to Section 8.54.620 shall be appropriated to a se parate project. Fo r funds received under the Foreclosed and Defa ulted Residential Property Registration Program or other programs that designate the use of funds for fo reclosure preventi on or mitigation purposes, the City Administrator or his or he r designee is auth orized to award grants and enter into grant contracts or service contracts wi thout returning to th e City Council in am ounts not to exceed one hundred thousand dollars ($100,000.00).

C. Notwithstanding the provisi ons of Subsection A. above, until June 30, 2027, funds deposited into the Affordable Ho using Trust Fund from the setaside of funds distributed to the City as a taxing entity under the Dissoluti on Laws may also be us ed for services and interventions aimed at: preventing disp lacement of low-income renters from their homes; preventing the displacement of lo w-income, senior, or disabled homeowners from their homes; rehousing for homeless re sidents; or protecting low-income renters from poor housing conditions leading to displacement. These serv ices and activiti es may include, but are not limited to, housing counseling and outreach, rapid- rehousing, legal serv ices, and housing assistance funds for tenants and homeowners w ho are lower income households or very low income households and who ar e at risk of losing their home or becoming homeless.

Notwithstanding the above, until June 30, 2018, funds deposited into the Affordable Housing Trust Fund from the setaside of funds distribu ted to the City as a taxing entity under the Dissolution Laws may also be used for services for homeless residents.

D. Notwithstanding the provisions of Subsection A. above, funds deposite d into the Affordable Housing Trust Fund from the Downtown Oakla nd Specific Plan Zoni ng Incentive Program may be used toward an y project to increase, improve, and preserve th e supply of affordable housing in the City, including in the Downtown District (D-D T) whenever possible to preserve, protect and produce affordable h ousing toward the explic it goal to maintain downtown as a mixed- income community.

E. Notwithstanding the provisions of Subsection A, above, upon a declaration of Extreme Fiscal Necessity by the City Council, the City Council may appropriate funds deposited into the Affordable Housing Trust Fund from the set-aside of funds distri buted to the City as a taxing entity under the laws dissolving redeve lopment agencies for any lawful purpose .

SECTION 2. Severability. If any section, subsection, sentence, clause or phrase of this Ordinance is for any reason held to be invalid or unconstitutional by decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of the Chapter. The City Council hereby declares that it would have passed this Ordinance and each section, subsection, clause or phra se thereof irrespective of the fact that one or more other sections, subsections, clauses or phrases may be declared invalid or unconstitutional

4 SECTION 3. Effective Date. This ordinance shall become effective immediately on final adoption if it receives six or more affirmative vo tes; otherwise it sh all become effective upon the seventh day after final adoption.

5 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

Date of Attestation:

NOTICE AND DIGEST