FOR THE COUNCIL MEETING OF FEBRUARY 21, 2023
COUNCIL AGENDA REPORT
TO: City Council
FROM: City Manager
Prepared by: Director of Community Development
SUBJECT: FISCAL YEAR 2022-23 HOME CONSORTIUM ALLOCATION
RECOMMENDATION
RECOMMENDATION:
That the City Council adopt a Resolution approving the use of Fiscal Year 2022-23 HOME Investment Partnerships funding to be allocated to assist the City of Santa Maria's Tenant -Based Rental Assistance program and an affordable housing project in Santa Barbara County.
BACKGROUND:
HOME Investment Partnerships (HOME) is a Federal program that funds a variety of activities aimed at providing affordable housing for low -to -moderate -income households.
The program is administered by the U.S. Department of Housing and Urban Development (HUD). The City has participated in the HOME program for decades, with a brief intermission during Fiscal Year (FY) 2016-17 when the City voted to apply for HOME funding on its own. The City was not successful and retumed to the County's Consortium a year later. Currently, the City is under contract with the Santa Barbara County Consortium as both a participating jurisdiction and a sub -recipient. As a sub -recipient, the City is currently using part of its funds to administer the Tenant -Based Rental Assistance (TBRA) program. The TBRA program provides one-time security deposit assistance of up to $2,500 to income -qualifying households renting a place in Santa Maria. The program began in 2010 and has assisted more than 1,100 local households. There is no other program of its kind in the City.
The remaining amount of the City's HOME funding has historically gone to an affordable housing development project in Santa Maria. Examples of recent affordable housing development projects in Santa Maria include Sierra Madre Cottages ($1,114,988 HOME funds and $285,012 in Santa Barbara County Inclusionary Housing In -Lieu funds for 40 senior units), Residences at Depot Street ($1,994,459 HOME funds and $1,178,978 in Santa Barbara County Inclusionary Housing In -Lieu funds for 80 units), West Cox Cottages ($1,350,000 Homeless Emergency Aid Program and $1,500,000 No Place Like Home for 30 units), and Good Samaritan Shelter for its Pine Street Bungalows II project ($291,137 HOME funds for 4 -bedroom, 3 -bath house).
DISCUSSION:
The City of Santa Maria is receiving $313,125 in HOME funding from the County's Consortium for FY 2022-23. The Federal fiscal year began October 1, 2021, and funds are provided for the Consortium fiscal year that began July 1, 2022. It is proposed that the City use part of the funding for its TBRA program and the other part to assist a project
within the County of Santa Barbara. In the fall of 2021 and again in the fall of 2022, the County of Santa Barbara, which is the lead agency and fiscal agent for the HOME Consortium, issued a Notice of Funding Availability (NOFA) including FY 2022-23 and anticipated 2023-24 HOME funds, respectively. The County of Santa Barbara is currently reviewing proposed projects and will connect with the City in the coming months to discuss potential local projects. For this reason, staff recommends that $163,125 of the overall FY 2022-23 HOME funding be used at the discretion of the County HOME Consortium unless a viable affordable housing project within the City (that qualifies for HOME funding) expresses interest. Allowing the County of Santa Barbara's HOME Consortium to fund an area project with the City's allocation is done from time to time when the City does not have a viable project eligible for the funds, or an interested affordable housing developer to use the funds. In addition, the City of Santa Maria has benefited from the County's portion of HOME funds in recent years.
As for the City's TBRA program, staff recommends that $150,000 of FY 2022-23 HOME funding be allocated to this program. By approving this proposed allocation, the City can continue offering the TBRA program seamlessly from one fiscal year to another. The amount recommended should be more than enough to cover the average amount of TBRA applications that come into the City, as well as additional TBRA's that will come because of new housing construction.
Alternatives
An alternative would be to use the entire $313,125 for TBRA; however, even with the popularity of the program and the increased deposit amounts that the City is now offering, the City has historically never spent more than $150,000 in one year.
Fiscal Considerations
The proposed action will provide $150,000 to the City's successful TBRA program which continues to serve dozens of residents in the community every year. Due to a lack of interested housing projects proposed in Santa Maria in 2022, the remaining amount has been retained by the HOME Consortium to use for a future affordable housing project within the county. The City's general fund will not be affected by this action.
Impact to the Community
The proposed action will have a beneficial impact on the community by continuing to provide affordable housing to Santa Maria residents with TBRA and will help create additional affordable housing in the County of Santa Barbara.
ROSIE ROJO
Community Programs Manager
CHUEN NG v
Director of Community Development
2 RESOLUTION NO.
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA
MARIA, CALIFORNIA, APPROVING THE USE OF FISCAL YEAR 2022-23
HOME INVESTMENT PARTNERSHIPS FUNDING TO BE ALLOCATED TO
ASSIST THE CITY OF SANTA MARIA'S TENANT -BASED RENTAL
ASSISTANCE PROGRAM AND AN AFFORDABLE HOUSING PROJECT
IN SANTA BARBARA COUNTY
WHEREAS, HOME Investment Partnerships (HOME) is a Federal program that funds a variety of activities aimed at providing affordable housing for low and moderate - income households; and
WHEREAS, the program is administered by the U.S. Department of Housing and Urban Development (HUD); and
WHEREAS, the City has participated in the HOME program, as part of a consortium with the County, since the consortium's inception in 1995, with a gap year during Fiscal Year (FY) 2016-17; and
WHEREAS, Santa Barbara County is the lead agency and fiscal agent for the Consortium, and the City is under contract with the County Consortium as both a participating jurisdiction and a subrecipient; and
WHEREAS, the City is expected to receive $313,125 in HOME funding from the County Consortium for FY 2022-23; and
WHEREAS, the City is successfully using its HOME funds for its Tenant -Based Rental Assistance (TBRA) program, and would like to continue offering this program by using $150,000 of its FY 2022-23 allocation towards rental deposits to those who income qualify; and
WHEREAS, the City did not receive a viable, local affordable housing project for FY 2022-23 HOME funding; and
WHEREAS, the City also understands the need for affordable housing in the community and would like to contribute its remaining $163,125 FY 2022-23 HOME funding to an affordable housing project in Santa Barbara County.
NOW, THEREFORE, IT IS HEREBY RESOLVED by the City Council of the City of Santa Maria, Califomia, as follows:
1. That $150,000 in HOME funds be allocated to assist with the City's TBRA program and provide rental deposits to area residents;
2. That $163,125 in HOME funds be used for an affordable housing project in Santa Barbara County; and
3. The Chief Deputy City Clerk is authorized and directed to make minor changes herein to address clerical errors, so long as substantial conformance of the intent of this document is maintained. In doing so, the Chief Deputy City Clerk shall consult with the City Manager and City Attorney concerning any changes deemed necessary.
PASSED AND ADOPTED at a regular meeting of the City Council of the City of Santa Maria held this 21st day of February 2023.
Mayor
ATTEST:
Chief Deputy City Clerk
APPR • ' AS T • ORM:
ty Attorney
APPROVED AS TO CONTENT: