City Council Memorandum
TO: HONORABLE MAYOR AND CITY COUNCIL DATE: FEBRUARY 28, 2023 FROM: OFFICE OF HOMELESS SOLUTIONS WARDS: ALL
SUBJECT: RESOLUTION AUTHORIZING THE CITY OF RIVERSIDE TO SUBMIT A CALHOME GRANT APPLICATION TO REQUEST $3,000,000 FROM THE STATE OF CALIFORNIA DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT’S 2023 HOMEOWNERSHIP SUPER NOFA TO SUPPORT THE CITY’S LOW-INCOME OWNER-OCCUPIED HOUSING REHABILITATION PROGRAM - SUPPLEMENTAL APPROPRIATION ISSUE:
Adopt a Resolution authorizing the City of Riverside to apply to the California Department of Housing and Community Development for the CalHome Program’s 2023 Homeownership Super NOFA to support the City’s Owner-Occupied Rehabilitation Program.
RECOMMENDATIONS:
That the City Council:
Adopt a Resolution authorizing the submission of an application to the California State Department of Housing and Community Development for funding under the Cal Home Program 2023 Homeownership Super NOFA to support the City’s Owner-Occupied Housing Rehabilitation Program; With at least five affirmative votes, authorize the Chief Financial Officer, or designee, to record an increase in revenues and appropriate expenditures in the amount of $3,000,000, or in the amount of the grant ward, in the Development Grants Fund, 22/23 CalHome Project, upon the award of grant funds; and Authorize the City Manager, or designee, to sign and execute all documents necessary for the administration of the Cal Home Program grant, including making minor and non-substantive changes.
BACKGROUND:
The City of Riverside has received competitive CalHome grant funds over multiple years since 2001. On January 6, 2023, the California Department of Housing and Community Development (HCD) released the 2023 Homeownership Super Notice of Funding Availability (SuperNOFA) making $170 million available to local public agencies and non-profits throughout the State of California for the CalHome Program ($135 million) and the Joe Serna, Jr. Farmworker Housing Grant Program-Homeownership ($35 million).
These programs assist individual first-time homebuyers through deferred-payment loans for mortgage assistance, home rehabilitation (including rehabilitation of manufactured housing not on a permanent foundation, and construction, repair, or addition of ADU’s or JADU’s), acquisition and rehabilitation, homebuyer counseling, self-help mortgage assistance, or technical assistance for self-help homeownership. All funds to individual homeowners are in the form of deferred loans. The maximum grant for which a public agency can apply is $5,000,000.
DISCUSSION:
Staff is requesting to apply for $3,000,000 in CalHome Program funds to support its existing Citywide Owner-Occupied Housing Rehabilitation Program. Currently, the City’s Program provides Community Development Block Grants (CDBG) and CalHome deferred loans to qualified homeowners to make repairs to their home, correcting health/safety issues as well as code enforcement violations. CDBG Grants in the amount of $5,000 are available to qualified single-family homeowners and up to $15,000 is available for qualified mobile homeowners who require minor repairs. CalHome deferred loans up to $60,000 for single-family home repairs are available. The program is available to persons earning at-or-below 80% of the Area Median Income.
Under the current SuperNOFA, Owner Occupied Rehabilitation Programs can provide deferred loans for the repair, reconstruction, or addition of an Accessory Dwelling Unit (ADU) or Junior Accessory Dwelling Unit (JADU) to a single-family home as well as deferred loans to homeowners of manufactured housing for major rehabilitation or even reconstruction if determined necessary. The allowed maximum loan amount for the repair, reconstruction or addition of an ADU is $250,000. The maximum loan amount for replacement of a manufactured home not on a permanent foundation in the case where it has been determined by the City is infeasible to rehabilitate the home, will be $150,000. Staff recommends incorporating the following activities into the City’s Owner-Occupied Housing Rehabilitation Program:
Repair, reconstruction or addition of an ADU or JADU to single-family homes; and Major rehabilitation or even reconstruction of manufactured homes.
With these grant funds the City will be able to assist a minimum of 20 households. If the City is awarded the CalHome grant, the funds would continue to be available to persons earning at-or-below 80% of the Area Median Income (at-or-below $70,400 for a family of four). There would be a 30-year affordability period on the ADU or JADU’s. The program provides up to 20% of grant funds to cover administration costs related to carrying out the grant, which would provide the City with up to $600,000 in administration costs. The CalHome grant term is three years.
STRATEGIC PLAN ALIGNMENT:
The Project supports Strategic Priority 2 – Community Well-Being and Goal 2.1 – to facilitate the development of quality and diverse housing supply that is available and affordable to a wide range of income levels.
This item aligns with each of the five Cross-Cutting Threads as follows:
Community Trust –The City of Riverside has identified the need for programs that assist low-income homeowners maintain the integrity of their homes allowing them to live in safe and suitable living conditions and encourage neighborhood revitalization.
Equity –This Program reaches lower-income populations of the City and offers equal opportunities for safe and suitable living conditions and housing sustainability as well as opportunities for financial growth.
Fiscal Responsibility – There is no fiscal impact to the City General Fund associated with this item. This item allows the City to leverage Federal Grants with other state and local funds to increase the affordable housing stock in the City.
Innovation –The CalHome grant will allow the City to capitalize on state funding to meet ongoing and changing housing needs of very low- to low-income members of the community.
Sustainability & Resiliency – Riverside is committed to meeting the needs of the present without compromising the needs of the future and ensuring the City’s capacity to persevere, adapt and grow during good and difficult times alike.
FISCAL IMPACT:
The total fiscal impact of this action is up to $3,000,000. Upon grant award and Council approval, an increase of revenue will be recorded in the amount of $3,000,000, or the amount of the grant award, and an equal amount appropriated in the Development Grants Fund, 22/23 CalHome Project revenue account number 9348200-334100 and expenditure account 9348200-440210. There is no City match required for this grant.
Prepared by: Michelle Davis, Housing Authority Manager
Certified as to
availability of funds: Edward Enriquez, Interim Assistant City Manager/Chief Financial Officer/City Treasurer
Approved by: Mike Futrell, City Manager
Approved as to form: Phaedra A. Norton, City Attorney
Attachment: CalHome Grant Resolution
Resolution Authorizing the City to Submit a CalHome Grant Application ● Page 2