City of Sacramento
City Council - 5PM Report
915 I Street Sacramento, CA 95814
www.cityofsacramento.org
File ID: 2024-01512 9/10/2024 Consent Item 2.
2024 Local Housing Trust Fund Application
File ID: 2024-01512
Location: Citywide
Recommendation: Adopt a City Council Resolution authorizing: 1) the Sacramento Housing and Redevelopment Agency (SHRA) on behalf of the City, to match on a dollar-for-dollar basis, the Low- Income Local Housing Trust Fund (LHTF) award pursuant to LHTF Guidelines Section 104; 2) the SHRA to act as the manager in connection with the California Department of Housing and Community Development (HCD) funds pursuant to HCD’s Notice of Funding Availability in an amount not to exceed $3.6 million; 3) the SHRA to submit, on behalf of the City, an application to the HCD for up to $3.6 million for funding under the LHTF Program; 4) executing a Standard Agreement for such funding when made available by HCD and executing any documents necessary to participate in the LHTF Program, and any amendments thereto; and 5) amending the SHRA Budget to receive and expend up to $3.6 million LHTF funds for the construction of new affordable multifamily rental housing.
Contact: Christine Weichert, Director, (916) 440-1353, [email protected], Sacramento Housing and Redevelopment Agency
Presenter: None.
Attachments:
1-Description/Analysis
2-City Council Resolution
3-Exhibit A - Summary of Use of Funds
Description/Analysis
Issue Detail: On July 9, 2024, HCD announced a Notice of Funding Availability (NOFA) for the LHTF Program. HCD awards LHTF funds to eligible applicants to enhance local housing trust funds by providing a dollar-for-dollar match. Applications under the NOFA are due to HCD no later than September 17, 2024.
The City has two funds created by in-lieu fees, one for new residential development (Mixed Income Housing Ordinance) and one for commercial development (Housing Trust Fund). SHRA administers these funds. These funds are eligible to serve as a match to the State LHTF funds. SHRA will utilize
File ID: 2024-01512 9/10/2024 Consent Item 2.
a combination of funds at the time of application to serve as the required match. Currently with the funds on hand the City can apply for $3.6 million to be committed over a five-year period.
LHTF-funded units will be restricted to households earning 60 percent or less of area median income (AMI), with a minimum of 30 percent of the LHTF funds being used for households earning 30 percent or less of AMI. LHTF funds will be administered using the Multifamily Lending and Mortgage Revenue Bond Policies in addition to LHTF Guidelines and the LHTF application. The Policies describe the priorities when funding new multifamily developments.
SHRA has applied for LHTF funds on behalf of the City and has successfully secured a $5 million dollar award in 2023. These funds have been committed to the Central Sacramento Studios Phase 2 project, which will produce over 65 new affordable housing units.
Policy Considerations: The actions requested in this report allow SHRA to apply for LHTF funds to increase the resources available for affordable multifamily housing construction through SHRA’s multifamily lending program. All affordable projects funded with LHTF funds will comply with the Council adopted Multifamily Lending and Mortgage Revenue Bond Policies and any State-specific LHTF requirements.
Economic Impacts: None.
Environmental Considerations: California Environmental Quality Act (CEQA): The proposed action is not considered a project under CEQA pursuant to CEQA Guidelines Section 15378(b)(4).
National Environmental Policy Act (NEPA): The proposed administrative and management activity is an exempt activity under NEPA pursuant to 24 CFR 58.34(a)(3).
Sustainability: Not applicable.
Commission/Committee Action: It is anticipated that, at its September 4, 2024, meeting the Sacramento Housing and Redevelopment Commission will approve the staff recommendation for this item. Staff will notify the Council in the event it is not approved.
Rationale for Recommendation: If SHRA’s application for LHTF funds is successful, the additional funds will increase the number of affordable housing units created in the City of Sacramento.
Financial Considerations: The LHTF application will request up to $3.6 million in funding. The program allows for five percent of the award to be used for administrative costs. In accordance with the LHTF Program Guidelines, funding will be in the form of deferred payment loans with simple interest of no higher than three percent. Loan repayments revolve into an LHTF reuse account, which is used to fund future SHRA loan programs for LHTF eligible activities.
LBE - M/WBE and Section 3 requirements: Local Business Enterprise requirements do not apply to this report. Minority and Women’s Business Enterprise requirements and Section 3 will be applied to all activities to the greatest extent feasible and as required by federal funding and in accordance with SHRA’s Section 3 Economic Opportunity Plan.
RESOLUTION NO. 2024 -
Adopted by Sacramento City Council
AUTHORIZING RESOLUTION
A Necessary Quorum of the City Council of the City of Sacramento (“Applicant”) hereby consents to, adopts and ratifies the following resolution:
BACKGROUND
A. WHEREAS, the Department is authorized to provide up to $53 million under the Local Housing Trust Fund (“LHTF”) Program from the Veterans and Affordable Housing Bond Act of 2018 (Proposition 1) (as described in Health and Safety Code section 50842.2 et seq. (Chapter 365, Statutes of 2017 (SB 3)) (“Program”).
B. WHEREAS, t he State of California (the “State”), Department of Housing and Community Development (“Department”) issued a Notice of Funding Availability (“NOFA”) dated 7/9/2024 under the LHTF Program.
C. WHEREAS, Applicant is an eligible Local or Regional Housing Trust Fund applying to the Program to administer one or more eligible activities using Program Funds.
D. WHEREAS, t he Department may approve funding allocations for the LHTF Program, subject to the ter ms and conditions of H&S Code Section 50842.2, the LHTF Program Guidelines, NOFA, Program requirements, the Standard Agreement and other related contracts between the Department and LHTF award recipients.
E. WHEREAS, t he Sacramento Housing and Redevelopment Agency (“Agency”) administers the City’s Housing Trust Fund and the City’s Mixed Income Housing Ordinance Fund both of which and used to fund the Agency’s Multifamily Housing Lending Program which follows the City-adopted Multifamily Lending and Mortgage Revenue Bond Policies.
F. WHEREAS, the proposed action is not considered a project under the California Environmental Quality Act ( CEQA) pursuant to CEQA Guidelines Section 15378(b)(4).
G. WHEREAS, the proposed administrative and management activity is an exemp t activity under the National Environmental Policy Act pursuant to 24 CFR
58.34(a)(3).
NOW THEREFORE BE IT RESOLVED THAT:
1. All evidence presented having been duly considered, the findings, including environmental findings regarding this action, as stated above, are found to be true and accurate and are hereby approved adopted.
2. If Applicant receives an award of LHTF funds from the Department pursuant to the above referenced LHTF NOFA, it represents and certifies that it will use all such funds on El igible Projects in a manner consistent and in compliance with all applicable state and federal statutes, rules, regulations, and laws, including, without limitation, all rules and laws regarding the LHTF Program, as well as any and all contracts Applicant may have with the Department (“Eligible Project”).
3. NOW THEREFORE BE IT RESOLVED: That the Agency on behalf of Applicant, is hereby authorized to act as the Manager for the Department’s Funds to eligible Projects pursuant to the above described Notice of Funding Availability in an amount not to exceed $3,600,000 (the “LHTF Award”)
4. The Agency on behalf of Applicant hereby agrees to match on a dollar for dollar basis the LHTF Award pursuant to Guidelines Section 104. Applicant hereby agrees to utilize matching finds on a dollar-for-dollar basis for the same Eligible Project for which Program Funds are used, as required by HSC Section50843.5(c).
5. Pursuant to Attachment 1 and the Applicant’s certification in this resolut ion, the LHTF funds will be expended only for Eligible Projects and consistent with all program requirements.
6. Applicant shall be subject to the terms and conditions as specified in the Standard Agreement, H&S Section 50842.2 and LHTF Program Guidelines.
7. The Agency Executive Director, who is La Shelle Dozier, is authorized to execute the LHTF Program Application, the LHTF Standard Agreement and any subsequent amendments or modifications thereto, as well as any other documents which are related to the Progr am or the LHTF Award to Applicant, as the Department may deem appropriate.
PASSED AND ADOPTED at a regular meeting of the Sacramento City Council this 10th day of September 2024 by the following vote:
AYES_____ ABSTENTIONS_____NOES______ABSENT________
Approving Officer__________________________
Signature of Approving Officer _________________________
CERTIFICATION OF THE ATTESTING OFFICER
The undersigned Officer of the City of Sacramento - City Clerk – Mindy Cuppy, does hereby attest and certified that the foregoing Resolution is a true, full and correct copy of a resolution duly adopted at a meeting of the Sacramento City Council which was duly convened and held on the date state thereon, and that said docu ment has not been amended, modified, repealed or rescinded since the date of adopted and is in full force and effect as of the date hereof:
ATTEST:_________________________________
Signature of Attesting Officer
Mindy Cuppy
Printed Name of Attesting Officer
Exhibit A
Summary of Use of Funds
Identification of the percent of the total funds requested that will be used for each activity/project, including area median income.
Program Funds and Matching Funds will be used for permanent loans to subsidize the new construction of multifamily rental housing. The Sacramento Housing and Redevelopment Agency (Agency) will retain five percent of Program Funds for program administration. The remainder of the Program Funds (95 percent) will be used on a dollar-for-dollar match basis with locally-generated housing trust fund dollars to support the development of affordable rental housing in the City of Sacramento.
All project funding mentioned above will be used to support households at or below 60 percent of area median income. A minimum of 30 percent of program funds will be used to support households at or below 30 percent of Area Median Income.
List of jurisdictions where activities/project will be delivered – City of Sacramento only.