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CONSENT CALENDAR
City of San Bernardino
Request for Council Action
Date: March 18, 2026
To: Honorable Mayor and City Council Members
From: Gabriel Elliott, Director of Community Development & Housing Department: Community Development & Housing
Subject: Amendment No. 2 to the HOME Investment Partnership Agreement between the City of San Bernardino and
Neighborhood Partnership Housing Services (All Wards)
Recommendation:
It is recommended that the Mayor and City Council of the City of San Bernardino, California:
1. Authorize the City Manager to execute Amendment No. 2 to HOME Investment Partnership Agreement Owner Occupied Rehabilitation Program (OORP) Subrecipient Agreement between the City and Neighborhood Partnership Housing Services, Inc. for $1,184,879 and extend the agreement term through December 31, 2026; and
2. Approve Resolution 2026-020, authorizing the Director of Finance and Management Services to amend the Fiscal Year 2025/2026 operating and capital budget by $1,238,169.45, by allocating $1,184,879 for Professional contractual services, and $53,290.45 for the City of San Bernardino administration; and
3. Authorize the City Manager, or their designees, to take any further actions and execute any further agreements or documents as necessary, including minor and substantive changes, after review by the City Attorney, as necessary, to effectuate the implementation of the Owner-Occupied Rehabilitation Program.
City Manager's Comments
The City Manager recommends approval.
Executive Summary
The Owner-Occupied Rehabilitation Program (OORP) assists income-eligible homeowners in San Bernardino to make essential home repairs to meet health and safety codes. The program offers deferred-payment loans up to $40,000 for repairs 3 2
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such as plumbing, roofing, accessibility improvements, and energy-efficiency upgrades for 20 households. Upon implementation of the program, it was discovered that the $40,000 was insufficient to adhere to the OORP Rehabilitation Standard due to the aged housing stock in San Bernardino. Additionally, after review by legal counsel, it was determined that it was in the City's best interest to eliminate any life-threatening conditions.
This amendment will allow Neighborhood Partnership Housing Services (NPHS) to continue administering the OORP program by supplementing the $40,000 HOME funded program with PLHA funds to cover any amount over the program limits. This will improve the quality of life for eligible households while preserving the City’s housing stock. To allow sufficient time for completion of rehabilitation activities associated with the supplemental funding and to ensure full expenditure of HOME and PLHA funds within regulatory timelines, this amendment also extends the program term through December 31, 2026.
Background
On May 15, 2024, the Mayor and City Council approved the allocation of $920,000 in HOME Investment Partnership Program (HOME) funds to re-instate the OORP program to allow for a potential 20 households to be served.
NPHS is a well-established Community Housing Development Organization (CHDO) and is administering the City’s OORP utilizing HOME funds. The OORP is designed to assist income-eligible homeowners by providing financial assistance to improve their homes' living conditions to meet the City’s health and safety code requirements.
Financial assistance is provided as a deferred-payment loan, not to exceed $40,000 per loan, pursuant to the City’s OORP guidelines. The deferred loan is secured by the property, with an affordability covenant and a deed of trust that outlines recapture provisions in the event of default.
Eligibility for the $ 40,000 program is based on household size and income level for owner-occupied single-family detached homes, townhomes, and condominiums within San Bernardino city limits. Reimbursable repairs and improvements include addressing health and safety issues, building code violations, accessibility, and general property-related repairs. Specific eligible improvements may consist of:
Plumbing and electrical repair
Roofing and structural repairs (e.g., foundation issues) Bedroom or bathroom additions to relieve overcrowding American with Disabilities Act (ADA) improvements
Energy efficiency upgrades
Lead Paint Testing & Abatement
Asbestos Testing & Abatement
Due to the expanded scope of rehabilitation work identified through updated property assessments and the addition of supplemental Permanent Local Housing Allocation 3 2
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(PLHA) funding, additional time is required to complete construction, finalize loan documentation, and ensure full compliance with HOME and PLHA regulatory requirements. The increased rehabilitation needs, particularly those involving life- threatening conditions and code deficiencies, have extended project timelines beyond the original term.
Discussion
The Owner-Occupied Rehabilitation Program (OORP) was established to improve the City’s housing stock while assisting low-income homeowners who may lack the financial resources to complete necessary capital repairs. In addition to preserving existing housing, the program supports the creation and maintenance of long-term affordability through the use of HOME funds for eligible rehabilitation activities.
When the program was initially implemented, the City established a $40,000 assistance limit based on estimated costs for common home repairs. However, during program implementation, staff determined that the $40,000 loan limit was often insufficient to meet the OORP Rehabilitation Standards, particularly given the age and condition of much of San Bernardino’s housing stock. This determination was based on a review of contractor bids received for construction, which frequently the program limits and the scope of work had to be altered to stay within the guidelines.
Additionally, following legal review, the City determined it is in the City’s best interest to address and eliminate life-threatening conditions as part of assisted rehabilitation projects. At the same time, rising construction and material costs in the current economic environment have further increased the cost of completing typical rehabilitation improvements. Consequently, the current program limit covers fewer necessary repairs than originally intended, placing a greater financial burden on participating homeowners and reducing the overall effectiveness of the program.
Without supplemental funds, the City would be forced to under-scope necessary repairs (risking noncompliance with standards) or reduce the number of households served under the current allocation (which was intended to support a potential 20 households).
The proposed amendment increases total program funding by $1,184,879 using available Permanent Local Housing Allocation (PLHA) funds, based on updated project assessments indicating that existing HOME funds are insufficient and total project costs are expected to exceed the current allocation. Staff recommend allowing up to an additional $40,000 in PLHA funds per household, bringing the combined assistance limit from both programs to $80,000 per household.
The amendment authorizes these PLHA resources (from 2019-2023) to be provided as “Supplemental OORP Loans” to supplement existing OORP loans as necessary to bring assisted properties into compliance with minimum HOME rehabilitation standards and to address increased construction costs associated with eligible rehabilitation activities. The supplemental assistance will be administered under separate PLHA loan 3 2
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documentation and is subject to City review and approval prior to commitment or disbursement, ensuring compliance with PLHA requirements.
Estimate evaluation: The $1,184,879 increase is supported by (1) the documented finding that project costs exceed the existing HOME allocation and require additional funding, and (2) the stated purpose of using PLHA to close the gap needed to meet minimum HOME rehabilitation standards and increased construction costs.
It is also consistent with the program’s original scale assumptions (approximately 20 households, with contractor work budgeted at up to $40,000 per household), where costs above the $40,000 cap would create a program-wide funding shortfall that must be addressed to preserve both compliance and the intended number of households served. Any unexpended PLHA funds remaining at the conclusion of the program may, subject to City review and written approval, be reallocated by NPHS to other eligible low-income projects consistent with PLHA Activity 2 requirements.
Accordingly, this amendment extends the agreement through December 31, 2026, to allow for completion of rehabilitation activities, proper documentation of supplemental PLHA loans, and timely expenditure of all funds in accordance with applicable federal and state requirements.
The use of PLHA funds for supplemental rehabilitation is consistent with the City’s adopted PLHA Plan. Eligible activities under PLHA Activity 2 include the predevelopment, development, acquisition, rehabilitation, and preservation of affordable rental and ownership housing, including Accessory Dwelling Units (ADUs), serving households earning up to 120 percent of Area Median Income (AMI). The proposed supplemental assistance qualifies as an eligible rehabilitation and preservation activity under Activity 2.
2021-2025 Strategic Targets and Goals
Approval of this action supports Strategic Target No. 3: Improved Quality of Life, by reducing the burden of homelessness and advancing the City’s commitment to collaborative solutions and housing stability.
Fiscal Impact
There is no fiscal impact on the General Fund. Approval of this item authorizes the useof $1,184,879 in available PLHA funds to supplement the existing $920,000 in HOME funds previously approved for the program.
Conclusion
It is recommended that the Mayor and City Council of the City of San Bernardino, California:
1. Authorize the City Manager to execute Amendment No. 2 to HOME Investment Partnership Agreement Owner Occupied Rehabilitation Program (OORP) Subrecipient Agreement between the City and Neighborhood Partnership 3 2
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Housing Services, Inc. for $1,184,879 and extend the agreement term through December 31, 2026; and
2. Approve Resolution 2026-020, authorizing the Director of Finance and Management Services to amend the Fiscal Year 2025/2026 operating and capital budget by $1,238,169.45, by allocating $1,184,879 for Professional contractual services, and $53,290.45 for the City of San Bernardino administration; and
3. Authorize the City Manager, or their designees, to take any further actions and execute any further agreements or documents as necessary, including minor and substantive changes, after review by the City Attorney, as necessary to effectuate the implementation of the Owner-Occupied Rehabilitation Program.
Attachments
Attachment 1 NPHS HOME Master Agreement
Attachment 2 NPHS OORP Amendment No.1
Attachment 3 NPHS OORP Amendment No. 2
Attachment 4 Resolution No. 2026-020
Ward:
All Wards
Synopsis of Previous Council Actions:
Synopsis of Previous Council Actions
April 15, 2020 The Mayor and City Council approved the City of San Bernardino’s Consolidated Plan for 2020-2025.
May 1, 2024 Proposed FY 2024-25 Annual Action Plan was taken to the Mayor and City Council for public comment and the City
Council to review proposed subrecipients.
May 15, 2024 Mayor and City Council approved FY 2024-25 Annual Action Plan.
February 19, 2025 The Mayor and City Council approved Fiscal Year 2024-25 Owner Occupied Rehabilitation Program Subrecipient
Agreement between the City and Neighborhood Partnership Housing Services, Inc. for $920,000
CC: Eric Levitt, City Manager