Agenda packet — Santa Monica City Council, December 17, 2024 (part 8 of 10)

For Office Use Only
-FILEDFile No.: BA20230536737
Date Filed: 3/29/2023
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Packet Pg. 1377 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

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Packet Pg. 1379 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) Appendix B
Lead Developer Org Chart
66 Hollywood Community Housing Corporation City of Santa Monica | Affordable Housing Proposal

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Packet Pg. 1380 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) HCHC Board of Directors
Sarah Letts
Executive Director
Angelica Pace
HR Manager
Bernie Perez
Operations Manager
Jameel Tayag
Office Administrator
Victoria Senna
Director of Housing
Development
C.J. Horvath
Senior Project Manager
Breigh Montgomery
Project Manager
Kristin Gunther
Project Manager
Laura Krug
Director of Finance
Jisun Kim
Assistant Controller
Shelly Huynh
Property Accountant
Brandi Johnson
Property Accountant
Sannah Rahim
Property Accountant
Vanessa Canales
Accounts Payable
Assistant
Kayla Teel
Director of Development
Marcela Rivera
Director of Resident
Services
Consuelo Lopez
Program Manager
Rylee Page
Senior Resident Services
Coordinator
Courtney Jennings
Senior Resident Services
Coordinator
Katherinne Gamez
Resident Services
Coordinator
Malen Rodriguez
Director of Property and
Asset Management
JC Nubla
Compliance Specialist
Christopher French
Senior Asset Manager
Don Bustamante
Asset Manager
Vince Adviento
Property and Asset
Manager
Victoria Yambao
On-site Property Manager
Gregorio Sanchez
Senior Facilities
Maintenance Technician
George Damian
On-site Property Manager
Rochelle Ogena
On-site Property Manager
Carole Mendoza
Senior On-site Property
Manager
Patrick Bustamante
On-site Property Manager
Willy Matulac
Senior On-site Property
Manager
Annalou Mangubat
Property and Asset
Manager
My Adviento
Senior On-site Property
Manager
Mary Ann Anderson
On-site Property Manager
Armin Bedrian
On-site Property Manager
May Layco
On-site Property Manager
Joanne Broderick
On-site Property Manager
Dionne Jupiter
On-site Property Manager
Rinna Gonzales
On-site Property Manager
Marybel Flores
On-site Property Manager

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Packet Pg. 1381 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) Appendix C
Hollywood Community Housing
Key Personnel
70 Hollywood Community Housing Corporation City of Santa Monica | Affordable Housing Proposal Hollywood Community Housing Corporation 71

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Packet Pg. 1382 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) Mercy Housing Lakefront, Chicago, IL 1994 - 1998
As the Director of Housing Development, structured complex deals financed with LIHTC equity, Section 8 subsidies, McKinney Homeless Assistance Funds, Housing for Persons with AIDS, CDBG, HOME and tax increment financing. Led all phases of the development process including site acquisition, selection and supervision of architects and contractors, and the closing of debt and equity financing. The nonprofit’s name during the 1990s was Lakefront SRO and their mission was to end homelessness. Lakefront SRO was a pioneer in the creation and operation of what is now called permanent supportive housing (PSH) and they subsequently merged with Mercy Housing.

Leadership Positions
UCLA Ziman Center’s Affordable Housing Advisory Council (AHAC) 2018 - Current As a member of the Ziman Center’s AHAC, provide strategic input on UCLA’s efforts to expand its affordable housing and community outreach programs. Also invited as a guest lecturer for UCLA’s Affordable Housing Development Program, an educational program designed to provide professionals with the knowledge and practical skills to develop affordable housing.

Enterprise Community Leadership Council (ECLC) 2018 - 2022 As a member of the ECLC, this group of leaders from across the country provides executives at Enterprise with strategic advice regarding all aspects of the affordable housing and community development industry.

Mayor’s Task Force for Housing, City of Pasadena 2021 - 2022 Invited by the Mayor of Pasadena to join the 16-member task force. The purpose of the task force is to ensure that housing experts contribute to the City’s policies, programs and Housing Element of the General Plan.

Board of Directors
Southern California Association of Non-Profit Housing (SCANPH) 2011 - 2017 Former President of the Board of Directors. SCANPH is a non-profit trade association incorporated in 1985 and serves five counties in Southern California.

Downtown Santa Monica, Inc. (DTSM) 2011 - 2016
Former Vice-Chair of the Board of Directors. First elected to the board by other property owners in the district in 2011 and re-elected in 2014. DTSM is a non-profit business improvement district (BID) incorporated in 1989 and the BID is primarily known for its innovative work to promote the Third Street Promenade in Santa Monica.

Education
Stanford University B.A. Degrees in Economics and Political Science University of California at Los Angeles (UCLA) M.A. Degree in Urban Planning Sarah Davis Letts
[email protected] | phone 323-454-6210
Experience
Hollywood Community Housing Corporation (HCHC), Los Angeles, CA 2016 - Present Executive Director of a non-profit that has expanded into markets throughout Los Angeles County and increased its commitment to creating and operating permanent supportive housing (PSH) for people experiencing homelessness. Work closely with the Board of Directors and senior staff to determine the strategic direction for the housing development, resident services, fundraising and asset management departments. Increased HCHC’s production of service-enriched affordable housing by closing the financing and completing construction of six properties (367 units) and acquiring sites and initiating the development of four new properties (368 units). Improved the financial resiliency of the organization with disciplined spending, improved fundraising and increased earned income.

Community Corporation of Santa Monica (CCSM), Santa Monica, CA 2011 - 2016 Executive Director of a community-based nonprofit with a $4+ million budget, 80 employees and 1,700 units of housing that generated over $14 million in annual rental revenue. Negotiated partnership agreements and closed debt and equity for six properties financed with low-income housing tax credits (LIHTC). Also negotiated a complex agreement fulfilling the inclusionary housing obligation of a marketrate developer. Oversaw the work of five departments including housing development, property management, maintenance, resident services and accounting. Improved the efficiency and effectiveness of each department through investments in technology and improved policies and procedures.

Determined the strategic direction for the company in collaboration with the Board of Directors.

Fannie Mae, Pasadena, CA 1999 - 2011
Director in the Multifamily Division and responsible for investing over $2 billion in 300+ apartment buildings financed with LIHTC equity. Led the team’s initiative to write and refine procedures and investment guidelines to handle the rapid growth of the Company’s LIHTC investment strategy.

Negotiated pricing and partnership agreements for guaranteed, private label and multi-investor funds.

Resolved real estate, tax and legal issues as part of the process of buying and selling LIHTC investments.

As a Director of Credit Loss Management in the Single Family Division from 2010 – 2011, co-led a team of professionals, who worked in distressed communities throughout the country, to address the foreclosure crisis by selling real estate owned (REO) to cities, counties and land banks.

Local Initiatives Support Corporation (LISC), Los Angeles, CA 1998 - 1999 As a consultant to LISC, managed the organization’s sponsorship of two bills in the California State Assembly including the Community Investment Tax Credit (AB 1080) that proposed the creation of a $50 million state tax credit and a $15 million expansion of the State LIHTC program (AB 97). Analyzed LIHTC allocation plans throughout the country to identify best practices and build a case against California’s lottery system for allocating LIHTCs.

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Packet Pg. 1383 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

VICTORIA
SENNA 818.426.1039
[email protected]
Jan – Present HOLLYWOOD COMMUNITY HOUSING CORPORATION
2017 Housing Director  Oversees all stages of affordable housing development for the organization including acquisition, feasibility analysis, pre-development, design, project financing, and construction. Responsibilities include:
 Identifying new acquisition opportunities  Supervising project managers through all phases of the real estate development process, including:
entitlements and permits, community outreach, tenant relocation efforts, land use reviews, and construction
 Assisting project managers with identifying funding sources for transactions to support site acquisition, predevelopment, construction, and permanent financing phases of development, such as: low income housing tax credits, multifamily housing bonds, conventional loans, and other public funds.  Negotiating contract agreements with the design team, consultants, and general contractor for each project
 Overseeing all financial closings  Developing and managing relationships with federal, state, and local funders, government agencies, community and neighborhood groups, development partners, and industry professionals.  Reviewing and approving project proformas, architectural drawings, funding applications, legal documents, loan agreements, schedules, budgets and draw requests Oct – Dec GULF COAST HOUSING PARTNERSHIP New Orleans, LA 2010 2016 Senior Project Manager
Completed commercial and residential transactions totaling $35 Million and in predevelopment or construction with transactions totaling $33 Million financed by multifamily housing bonds, LIHTC, historic tax credits, HOME, CDBG, FHLB-AHP, NSPII, USDA 515, local funding and conventional financing.

Nov – Sept HOLLYWOOD COMMUNITY HOUSING CORPORATION Los Angeles, CA 2006 2010 Project Manager
Completed transactions totaling $30Million financed by affordable housing bonds, LIHTC, historic tax credits, CDBG, City of Industry funds, CRA, HOME, FHLB-AHP, and conventional financing Oct – Nov THE DT GROUP Los Angeles, CA
2002 2006 Project Manager
Project: The NoHo Lofts – Built 1957 - Adaptive Reuse of an industrial building to live/work lofts - $18M Nominated for a women’s business award by The San Fernando Valley Business Journal

OTHER PROFESSIONAL EXPERIENCE
Mar – Sept APCO WORLDWIDE Washington, DC
2001 2001 Business Development Associate
Identified and pursued new business opportunities
Sept – Mar POINT OF PURCHASE ADVERTISING INTERNATIONAL (POPAI) Washington, DC 1998 2001
CorporateCommunications Manager
Performed marketing, public relations and government relations duties Sept – Sept OFFICE OF CONGRESSMAN BART STUPAK Washington, DC 1997 1998 Staff Assistant
Acted as constituent liaison and legislative staff support/Speeches published in Congressional Record EDUCATION: UNIVERSITY OF CALIFORNIA LOS ANGELES (UCLA) -Extension Professional designation in Construction Management conferred in 2009 LOCAL INITIATIVE SUPPORT CORPORATION (LISC) - Housing Development Training Institute Yearlong comprehensive training in affordable housing development – Certified 2008

MANAGEMENT ACTION PROGRAM (MAP)
Executive business management training program - Certified 2005

MARQUETTE UNIVERSITY
Bachelor of Arts conferred in 1997 - Major: History / Minors: Philosophy and Advertising St. Clare's at Oxford - England - 1996 Spring Semester Abroad This Page
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Packet Pg. 1384 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) • Represents HCHC with Investors, Government agencies and in the community as needed. • Assists in the preparation of pro-forma budgets during pre-development. • Reviews loan documents prior to execution.
• Oversees 3rd party Property Management Agent.
• Oversee In-House Property Management
• Oversees Lease Up Activities (From Pre-Lease Up to receipt of 8609) Certifications:
• Certified Credit Compliance Professional (C3P) for Low Income Housing Tax Credit,; NPCC • Annual TCAC Advance Workshops
• Certified on Real Estate Property Management Principles –Allied Real Estate Schools -2020 • Trained and Certified on Fair Housing Rights –Annually • Trained and Certified on Accessibility Housing Program Malen Rodriguez
[email protected]
Director of Property & Asset Management
Hollywood Community Housing Corporation
Los Angeles, California
Serving the Low-Income Housing Tax Credit Industry since 1996 Resident Service Coordinator
Temple Westlake Neighborhood Development Corporation
1996-1999
Property Manager/Regional Manager/Compliance Specialist Barker Management Incorporated
1999-2005
Director of Property & Asset Management
Hollywood Community Housing Corporation
2005-to Present
Responsibilities:
• Evaluates portfolio performance and review monthly, quarterly and annual financial reports. • Identify portfolio needs and maintain and implement schedule of capital needs. • Ensures all properties meet or exceed development pro forma expectations and meet all investors and regulatory requirements including operating and profitability goals. • Ensures compliance with all regulatory agencies.
• Ensures compliance with all Limited Partnerships Property and Asset Management’s requirements. • Reviews and approves property services and contracts. • Conducts regular site inspections; Audits files and conducts physical inspections using the current Housing Quality Standards (HQS).
• Ensures that Property Staff are annually trained in areas of Fair Housing, Income Certification and basic property management good practices including being current on PM’s software (RealPage); ensures extensive collaboration with Service providers.
• Reviews and approve operating budgets including those of the Department of Housing and Community Development/Multifamily Housing Program (HCD/MHP) and Veterans Homeless Housing Program (VHHP) - budgets and worksheets; review submissions of Annual Owner’s Certifications and Expenses (AOC and AOE) as required by California Tax Credit Allocation committee (CTCAC). • Monitors and evaluates the long-term financial viability of projects; investigate options such as debt restructuring or re-syndication or conversion to Project based Section 8 program; Monitors, evaluates and plans for the 15 year buy-out options.
• Apply for Welfare Tax Exemptions with the BOE; Prepare and submit Annual Property Tax exemptions for each project; analyze tax assessments.
• Reviews and obtains Annual Property Insurance requirements. • Reviews drafts of all projects’ Annual Audited Financial Statements before conversion to final. • Analyzes and prepares Residual Receipt Calculations for soft loans. • Analyzes and Prepares Cash Flow for Distribution.

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Packet Pg. 1385 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) Appendix D
kevin daly Architects
Org Chart & Key Personnel
78 Hollywood Community Housing Corporation City of Santa Monica | Affordable Housing Proposal Hollywood Community Housing Corporation 79

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Packet Pg. 1386 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) Kevin Daly
Principal
Gretchen Stoecker
Studio Director
Courtney Gibbs
Senior Associate
Vanina Fiamingo
CFO
Jared Ward
Studio Director
Luke Smith
Senior Associate
Julian Funk
Associate
Jeff Rauch
Associate
Kevin Nicholson
Architect
Vanessa De La Hoz
Designer
Ryan Conroy
Architect
Connor Verteramo
Designer
Ben Sherlock
Office Manager
kevin daly Architects
Org Chart

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Packet Pg. 1387 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) Education
˙ M.Arch, Rice University
˙ B.Arch, UC Berkeley
Registration
˙ California (#C19005)
˙ Arkansas
˙ Florida
˙ Maine
˙ Massachusetts
˙ New York
˙ Texas
˙ Washington
˙ NCARB
˙ LEED AP
Recent Awards
˙ 2023 National AIA Housing Award
˙ 2023 Residential Design Architecture
Award
˙ 2022 National AIA Honor Award
˙ 2022 LABC Architectural Award
˙ 2022 Architect’s Newspaper Best of
Practice
˙ 2022 AIA Houston Design Award
˙ 2022 AIA Santa Barbara Design Award
˙ 2022 PCBC Grand Award
˙ 2022 AIA/LA Design Award
˙ 2022 P/A Award
˙ 2021 AIACC Design Award
˙ 2021 SCANPH Homes Within Reach
Award
˙ 2021 Architect’s Newspaper Best of
Design
˙ 2020 AIACC Design Award
˙ 2019 National AIA Honor Award
˙ 2018 National AIA Honor Award
Kevin Daly
Principal
Over his thirty-year career, Kevin Daly has defined a design process that upholds the practical magic of architecture – an alchemical conjunction of craft, materials, and form. Bolstered by abundant research, he has demonstrated the benefits of advanced, unconventional building technology in works that are consistently recognized in publications and awards, and range from public schools, custom residences, and university buildings to affordable housing.

Daly is particularly recognized for reclaiming and transforming sites characteristic of the postwar city, turning generic background buildings into models of community identity. Noted architecture critic Nicolai Ouroussoff, writing about Daly’s inner city charter schools, claimed they are some of “the most inspiring projects built in Los Angeles in years” and a model of “a thoughtful, low-cost work of architecture that embodies the kind of civic purpose and progressive ideals that so many public institutions give lip service to but rarely fulfill.” Projects by Kevin Daly express his belief in an architecture that is performative on every level: environmentally, structurally, economically, and aesthetically. Daly has established a critical practice that is nationally recognized and simultaneously engages the profession as well as the local community. Almost every project has been published nationally or received awards for design excellence. He has served on numerous AIA awards juries, won the first AIA/LA Firm of the Year Award, held distinguished university chairs at Berkeley and Michigan, and is a regular faculty member at UCLA. Through his teaching experience he fosters a next generation of architects across the country.

Selected Project Experience
˙ NW Arkansas Artist Housing & Residency Program 2018 - Present ˙ Houston Endowment Headquarters, Principal 2019 - 2022 ˙ UC Berkeley Albany Village Housing, Principal 2019 - 2022 ˙ Gramercy Senior Housing, Principal 2016 - 2021
˙ Robertson Recreation Center, Principal 2014 - 2020
˙ UCSB San Joaquin Housing, Principal 2014 - 2017
˙ UCLA Mo Ostin Basketball Center, Principal 2014 - 2017 ˙ UCLA Evelyn & Mo Ostin Music Center, Principal 2011 - 2015 ˙ Broadway Affordable Housing, Principal 2011 - 2014
kdA
Education
˙ M.Arch, Yale University
˙ B.Arch, Syracuse University
Registration
˙ New York
Recent Awards
˙ 2023 Residential Design Architecture
Award
˙ 2022 National AIA Honor Award
˙ 2022 AIA Houston Design Award
˙ 2022 P/A Award
˙ 2022 PCBC Grand Award
˙ 2022 AIA Small Project Award
˙ 2021 AN Best of Design Award
˙ 2020 AIACC Design Award
˙ 2019 AIA/LA Design Award
˙ 2019 WoodWorks Design Award
Gretchen Stoecker was most recently the project manager for the new Houston Endowment Headquarters in Texas, a 20,000SF, award-winning hybrid steel/CLT building that finished construction in 2022. The building’s Net Zero efficiency capabilities are mirrored in its extreme cost efficiency, with a construction cost of $20,000,000. Prior to that Gretchen oversaw the design and construction of a $2m residential home in Venice, CA, using precast concrete and elegant wooden screening to add a new residence to a two-lot property that three generations of the client’s family call home.

She was also the project manager for two major campus projects at UCLA. The first was the Evelyn & Mo Ostin Music Center, which created new education resources for the diverse School of Music at the heart of the campus. Through thorough and regular meetings with UCLA faculty, staff and students the Music Center master planning document revealed the most cost and program effective solution was the development of new construction and phased renovation of the existing buildings.

Gretchen also prepared a second DPP for the Mo Ostin Basketball Center, part of the growing athletics precinct on the UCLA campus and shared by the top-ranked men’s and women’s UCLA teams. She worked closely with the contractor to rightsize the design within the constraints of site and budget while still creating a LEED Platinum, top-tier, athletic facility.

Gretchen brings a refined sensibility and technical expertise to the wide range of buildings and systems that make up the kdA portfolio, from site cast concrete residential projects to innovative terra cotta rainscreens, precast GFRE building envelops, and ETFE glazing systems.

Selected Project Experience
˙ UCSB Music Library Renovation, Project Manager 2021 - Present ˙ Houston Endowment Headquarters, Project Manager 2019 - 2022 ˙ Palms House II, Project Manager 2016 - 2020
˙ Robertson Recreation Center, Project Architect 2014 - 2020 ˙ UCLA Mo Ostin Basketball Center, Project Manager 2014 - 2017 ˙ UCLA Evelyn & Mo Ostin Music Center, Project Manager 2011 - 2015 Gretchen Stoecker
Director
kdA

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Packet Pg. 1388 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) Jared Ward
Director
Education
˙ M.Arch, SCI-Arc
˙ BFA, Weber State University
Registration
˙ California
Recent Awards
˙ 2022 P/A Awards
˙ 2022 AIA Houston Award
˙ 2022 AIA National Small Projects Award
˙ 2022 PCBC Grand Award
˙ 2021 AIA/LA Residential Architecture
Award
˙ 2020 AIA California Design Award
˙ 2019 Woodworks Design Regional Award
˙ 2019 AIA/LA Design Award
Jared Ward has over twenty years of experience designing dynamic public facilities and will bring to the project team an unrivaled depth of technical knowledge of the mechanical and physical qualities of residential design and innovative production and fabrication techniques.

He has managed the design and construction process for a large number of kdA’s campus projects during his 22 years at the firm: he was the project manager for the UCSB San Joaquin Housing project in Santa Barbara and recently completed the final construction document stages of the UC Berkeley Albany Village housing design, working to maintain the project’s massing, materiality, and the architectural character of its façade and amenity spaces.

He is also the project manager for the design and construction of new Dahlia Heights Elementary School and kindergarten classrooms, scheduled for completion in 2023. Jared has been heavily involved in all of kdA’s large scale institutional projects including the UCLA School of Music, the Edison Language Academy classrooms, the Camino Nuevo Charter Academy, the Art Center College of Design South Campus, and the Art Center College of Design Housing Complex.

Relevant Project Experience
˙ UCSB CCBER Renovation, Project Manager 2022 - Present ˙ Dahlia Heights Elementary School, Project Manager 2017 - Present ˙ NW Arkansas Artist Housing & Residency Program, Project Manager 2018 - Present
˙ UC Berkeley Albany Village Housing, Project Manager 2019 - 2022 ˙ UCSB San Joaquin Villages Housing, Project Manager 2012 - 2017 ˙ UCLA School of Music Master Plan, Project Architect 2011 - 2015 ˙ Edison Language Academy, Project Manager 2011 - 2014
kdA
Luke Smith
Senior Associate
Education
˙ M.Arch, Princeton University
˙ B.Arch, Oxford Brookes University
Registration
˙ California
Recent Awards
˙ 2022 P/A Awards
˙ 2022 AIA Houston Award
˙ 2021 AN Best of Design Honorable
Mention
˙ 2021 SCANPH Homes Within Reach
Award
˙ 2021 AIACC Residential Design Awards
˙ 2020 AN Best of Design Awards
˙ 2020 AIA/LA Next Awards
Luke brings high-level expertise in façade systems and the environmental and formal performance of building skins. His multi-family residential project, Gramercy Senior Housing, completed construction in Summer 2021, and the Houston Endowment Headquarters with its distinctive louvered canopy and custom-formed aluminum rainscreen opened in Fall 2022.

He is both a talented designer and an exceptional manager, with a deep knowledge of complex building systems. Luke’s expertise is rooted in the tectonics of complex systems, with a particular focus on the environmental and formal performance of building envelopes and cladding. He has worked extensively on projects that include a high level of prefabrication, as well as direct-to-fabrication processes. Luke’s detailed knowledge of building skins makes him uniquely qualified to assess rehabilitation of existing structures versus new construction.

Selected Experience
˙ Mammoth Lakes Affordable Housing, Project Architect, 2019 - Present ˙ Houston Endowment Headquarters, Project Manager, 2019-2022 ˙ Gramercy Senior Housing, Project Manager, 2017-2021
kdA

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Packet Pg. 1389 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) Julian Funk
Associate
Education
˙ M.Arch, Harvard University
˙ BSc. Architecture, Ohio State University
Registration
˙ California
Recent Awards
˙ 2022 P/A Awards
˙ 2022 AIA Houston Award
˙ 2022 AIA National Small Projects Award
˙ 2022 PCBC Grand Award
˙ 2021 AIA/LA Residential Architecture
Award
˙ 2020 AIA California Design Award
˙ 2019 Woodworks Design Regional Award
˙ 2019 AIA/LA Design Award
Julian Funk received his Bachelor of Science in Architecture from The Ohio State University and his Master of Architecture from Harvard University. At Harvard he taught a six week design studio for undergraduate students and worked as a teaching assistant for a recurring seminar on housing typologies, specifically in Latin America. Prior to joining kdA Julian worked at Machado Silvetti in Boston and developed campus plans for projects in Vietnam and Cairo.

Julian has guided the design and technical development of several projects at kdA with an exceptional ability to translate architectural concepts into construction documents. He has coordinated the documentation of the Artspace COMO Lofts (artist housing in Bentonville, AR) and a graduate student housing project for the University of California Berkeley.

Julian will coordinate all subconsultants within the architectural and engineering project team, ensuring thorough and accurate documentation of the project.

Relevant Project Experience
˙ UC Berkeley Albany Village Housing, Project Designer 2022 ˙ Artspace SOMO Housing, Project Architect 2022 - Present ˙ Robertson Recreation Center, Project Architect 2018 - Present ˙ Tech Workplace Campus, Project Architect 2022
kdA
Ryan Conroy
Architect
Education
˙ M.Arch, UC Berkeley
˙ B.A. Architecture, UCLA
Registration
˙ California
Recent Awards
˙ 2022 AIA Houston Design Award
˙ 2022 P/A Award
˙ 2020 AIA/LA Next LA Award
Ryan Conroy received his Master of Architecture at UC Berkeley after completing his Bachelor of Arts in Architecture at UCLA.

Ryan Conroy brings a deep knowledge of contemporary architectural design and research experience to his work at kdA. He has directed the design efforts of award-winning projects such as the Houston Endowment Headquarters and is currently completing a mixed-use project in the Ocean Park neighborhood of Santa Monica.

Ryan will coordinate the internal architectural design team, as well as presentations for community workshops and entitlements approvals.

Selected Project Experience
˙ UC Berkeley Albany Village Housing, Project Designer 2022 ˙ Houston Endowment Headquarters, Project Designer 2022 kdA

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Packet Pg. 1390 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) Appendix E
Morley Builders
Key Personnel
88 Hollywood Community Housing Corporation City of Santa Monica | Affordable Housing Proposal Hollywood Community Housing Corporation 89

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Packet Pg. 1391 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

COMPANY TENURE
28 years with Benchmark
33 years in Construction Industry
10 West Walnut
120 Wilshire Parking Structure
The Academy Museum of Motion
Pictures Phase A
Archstone Apartments at Playa del
Rey Phase I & II
Bank of America Brea Operations
Center
Carrier Center
Casa Dominguez
Casa Merced Senior Housing
El Cariso Park Gymnasium &
Community Center
Getty Villa Renovation & Expansion
Janss Marketplace Mall Renovation,
Expansion & Parking Structure
Jesse A. Brewer 77th St. Regional
Headquarters
Los Angeles Department of Public
Works, Alhambra Headquarters
Loyola Marymount University Del Rey
North & South Residence Halls
Loyola Marymount University Leavey
Student Apartments Building 6
NBCUniversal G-Lot Expansion
Occidental College Rangeview Hall
Pepperdine University Gull’s Way
Residence
Polytechnic School Renovation &
Addition Phase I-IV
Santa Monia Business Park Phase I
UCI Plaza Verde
UCLA Knudsen Hall
USC Heritage Hall Recapitalization
USC Health Sciences Campus
Student Housing Phase II
Valley Office Plaza
Warner Records Building

PROJECT EXPERIENCE

EDUCATION
UCLA Anderson School of
Management,
Executive Program
California Polytechnic University,
San Luis Obispo
Bachelor of Science, Construction
Management
As Project Executive, Carlos oversees a full range of construction services.

Joining the Benchmark team as an intern in 1995, he now manages some of the company’s largest and most complex projects. Carlos’ relationships with clients are enduring, a testament to his integrity and his skill at pairing project teams and approaches with client goals and expectations. He is dedicated to client satisfaction, focusing on quality preconstruction services and following through with a hands-on, team-oriented approach during construction. In partnership with the Project Superintendent and Project Manager, he manages the development and maintenance of project schedules in order to meet project goals on time and within budget.

CARLOS OROZCO

PROJECT EXECUTIVE

AFFILIATIONS
ACE Mentor Program, Mentor
Structural Engineers Association of
California, Member

CERTIFICATIONS
10-Hour Occupational Safety &
Health Training Course, OSHA
30-Hour Occupational Safety &
Health Training Course, OSHA
Basic/Adult CPR & First Aid, Medic
First Aid International

COMPANY TENURE
10 years with Benchmark
Crest Apartments
Santa Monica Proper Hotel
Thatcher Yard
USC Malcolm & Barbara Currie
Residence Hall
USC Health Sciences Campus
Student Housing Phase II
USC Dr. Verna & Peter Dauterive Hall

PROJECT EXPERIENCE

EDUCATION
University of California, Los Angeles
Master of Architecture & Urban
Design
Sonoma State University
Bachelor of Liberal Studies
As Senior Project Manager, Brittany is responsible for day-to-day oversight on projects. She is particularly skilled in procurement and managing multifaceted finish trades. She enjoys being onsite, working closely with many people to build meaningful projects - and relationships - that will last. With her collaborative nature, strong work ethic, and clear and honest communication, Brittany brings added-value to any project team. Brittany balances her commitment to work with an interest in hiking and backpacking, especially in the Sierras. She considers the energy and commitment she brings to every project as being some of her most important contributions to Benchmark.

BRITTANY DZIUBEK

SENIOR PROJECT MANAGER

CERTIFICATIONS
Certified Construction Manager,
Construction Management
Association of America

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Packet Pg. 1392 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

COMPANY TENURE
28 years with Benchmark
2802 Pico Apartments
Archstone Apartments at Pasadena
Archstone Apartments at Santa
Monica
Eastown Apartments
Caroline Severance Manor
Casa Patrina
Cathedral of Our Lady of the Angels
Coralwood Court Apartments
Crocker Umeya Apartments
Fountain Park Apartments at Playa
Vista
Hollywood Arts Collective
IMAX Corporation Headquarters
Jewish Community Center Campus
LA Plaza Village
Loyola Marymount University Jesuit
Housing Complex
North Ranch Self-Storage
Occidental College Johnson Student
Center
Occidental College Rangeview Hall
Pasadena Gateway Villas
Polytechnic School Renovation &
Addition Phase I-IV
Tierra del Sol
USC Health Sciences Campus
Student Housing Phase II
Villa Madera
White Oak Apartments
WREN Apartments

PROJECT EXPERIENCE
As Senior Project Superintendent, Randy is responsible for all onsite construction activities, with particular focus on multifamily residential projects.

He is known for always displaying the highest level of professionalism and integrity on each one of his projects. His strengths include jobsite organization and pre-planning, effective communication with project stakeholders, and an exceptional ability to motivate the project subcontractors to produce at their highest level.

RANDY HAUSER
SR. PROJECT SUPERINTENDENT

CERTIFICATIONS
10-Hour Occupational Safety and
Health Training Course, OSHA
30-Hour Occupational Safety and
Health Training Course, OSHA
Basic/Adult CPR & First Aid, Medic
First Aid International
Trench Shoring Competent Person
Certification
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Packet Pg. 1393 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) Appendix F
The People Concern
Org Chart & Key Personnel

11.A.k
Packet Pg. 1394 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) John Maceri
Chief Executive
Officer
Rafe Pery
Chief Financial
Officer
Teresa McDonough
Director of Finance
Finance Department
Patricica Lopez Chief
Administrative
Officer
Donna Miller
Director of
Operations
Operations
/Facilities/ IT
QA / Compliance
Jolisa Jones- Corey
Chief Humans
Resources Officer
Human Resources
Training
Andrea Rackley,
Director of
Development
Development
Department
Julie DeRose Chief
Program Officer,
Permanent Housing
Permanent
Supportive Housing
CES
Rapid Rehousing
Brooke Slusser Chief
Program Officer,
Mental Health
Wellness Center
Clinical Supervision
All outreach - TFs,
E6, HMST, C3

IMHT/ FCCS/ MIT
TuLynn Smylie Chief
Program Officer,
Services

SOJOURN
Interim Housing
Access Center &
FRAC
Crisis Invervention
Arts Program
Money Management
K9
Angie Loch, Chief
Compliance Officer
Kait Peters Chief
Strategy &
Integration Officer

11.A.k
Packet Pg. 1395 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) John Maceri
8631 Jellico Ave.

Northridge, CA 91325
(818) 341-4824

EXPERIENCE
Ocean Park Community Center (OPCC) 1999- Present
Santa Monica, CA
Executive Director
Responsible for managing a nonprofit organization providing housing and services to low-income and homeless youth, adults and families, battered women and their children, people with mental illness and Veterans. OPCC has an annual operating budget of $13.5 million, employees 150 people, and serves over 5,000 people a year. Responsible for working closely with the board of directors and development team to raise over $5 million a year in private donations, as well as overseeing, in collaboration with the Associate Director and Finance team, the administration of $8.5 million in government contracts and grants. Lead a senior management team of fifteen people, responsible for overseeing all aspects of agency administrative functions, board relationships, strategic planning and community and government relations. In the last sixteen years I’ve supervised the rehabilitation of an existing transitional housing program, the acquisition and rehabilitation of a new second stage shelter for our domestic violence program, expansion of our permanent supportive housing program from 120 to 250 units, and overseen the successful completion of a $19.5 million capital campaign for the construction of two new buildings for the relocation and expansion of four programs into two new sites.

Homestead Hospice & Shelter 1990-1999
Los Angeles, CA
Executive Director
Responsible for managing a nonprofit AIDS housing and service organization with an annual operating budget of $2.1 million. Oversaw the growth of the organization from three facilities with twenty employees, to eight facilities and fifty-four employees. Extensive experience in fundraising from both the public and private sector, working closely with the board of directors and development committee to raise over $500,000 annually. Actively involved in leadership positions in several public policy and advocacy committees.

Best Stationers, Inc. 1988-1990
Van Nuys, CA
Vice President, Chief Operating Officer
Managed a private, for profit family owned retail and commercial office supply business with annual sales of $3.5 million. Responsible for supervising daily operations including hiring and training, purchasing, distribution, customer service, outside sales, retail merchandising and vendor relations. Supervised a staff of seven and managed an active monthly customer base of three hundred companies.

Warner Center Office Products 1983-1988
Woodland Hills, CA
President
Owned and operated a full service retail and commercial office supply business which was started with $10,000 in personal savings. Expanded the company from one employee to eight within two years, and steadily increased annual sales from $200,000 to $1.8 million.

Established an award winning retail store that was used as an industry design and merchandising model.

EDUCATION
B.A., Biology – Western Washington University, Bellingham, WA – 1980 A.A., General Studies – Wenatchee Valley College, Wenatchee, WA – 1978

ACTIVITIES & AWARDS
National Association of Social Workers (NASW), CA Chapter Region H – Public Citizen of the Year (2010)
National Association of Social Workers (NASW), State of California – Public Citizen of the Year (2010)
A Community of Friends – Advocate of the Year Award (2010) Member, Board of Directors of the Santa Monica Bay Area Human Relations Council (2009- 2014)
Member, Westside Shelter & Hunger Coalition Board of Directors (1999-2014) – Past Board Chair
Member, Board of Directors of the Santa Monica Chamber of Commerce (2011) Board Member & Vice President, North Valley Caring Services, Inc. (2003-2008) Chair, Los Angeles HOPWA Community Advisory Committee (1994-1999) Consultant with various nonprofit organizations providing assistance with staff and board training and development, capacity building and strategic planning (Being Alive, Whittier Rio Hondo AIDS Project, Center For Health Justice and El Camino Community College Foundation).

11.A.k
Packet Pg. 1396 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) Curriculum Vitae
for
JULIE DeROSE, MFT
_____________________________________________________________________________ Licensed Marriage and Family Therapist License # MFC 2486 ______________________________________________________________________________

EDUCATION
M.A., Loyola Marymount University, Los Angeles, California Marriage, Child and Family Therapist
B.F.A., Saint Mary's College, Notre Dame, Indiana
______________________________________________________________________________

PROFESSIONAL MEMBERSHIP
California Association of Marriage and Family Therapists (CAMFT) American Art Therapy Association (AATA)
____________________________________________________________________________

EXPERIENCE
OPCC/LAMP March 2015/Present
Santa Monica/Los Angeles, CA
Director of Permanent Housing Direct administrative and clinical oversite of programs connected to the Housing Department at both locations. This includes staff that provide case management and mental
health services to a housing portfolio of over 800 scattered site and project based housing units, a Shared Housing
Program, and a Rapid Re-housing project. Also responsible for program development, management of all grant and
foundation reports, researching new grant opportunities, and oversight of budget and budget planning.

ST JOSEPH CENTER Sept 2010/March 2015
Venice, CA
Director of Programs As a member of the senior management team, responsibilities include oversight of agency wide programs ranging from services designed to impact low-income
families facing food insecurity and barriers to accessing basic needs, to homeless prevention and interventions
services. Manage a team of clinical directors to ensure services are provided in line with the agency mission. Also responsible for program development, administration of all grants and foundation reporting, researching new funding opportunities, and oversight of program budget and budget planning process. Created and implemented agency wide
procedures to integrate service delivery. Developed
relationships with grant and foundation monitors to
guarantee compliance and continued funding. Participated in the development and implementation of an agency wide strategic plan. Increased funding and implemented best
practice approach to service delivery including changing our pantry model as well as the agency’s philosophy
regarding homeless services.

ST JOSEPH CENTER Oct 2001/Sept 2010
Venice, CA
Director of Homeless Services Supervision of Homeless Services Continuum including the following programs: Homeless Service Center which consist of an Outreach Team, Case Management Team, Chronic
Homeless Team, and Clinical Team; Affordable Housing
which is designed to help individuals obtain Section 8
vouchers and Shelter Plus Care Certificates; Bread and Roses Café, a meals program for homeless individuals and families;

11.A.k
Packet Pg. 1397 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) Curriculum Vitae
for
JULIE DeROSE, MFT
_____________________________________________________________________________ Licensed Marriage and Family Therapist License # MFC 2486 ______________________________________________________________________________

11.A.k
Packet Pg. 1398 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) and Senior Services which works with both homeless and
housed low income seniors. Responsibilities included
oversight of all clinical and programmatic aspects of each program including emergency service delivery to homeless adults and families, crisis intervention of psychiatrically disabled homeless adults, case coordination and long term planning, and linkage to mental health and substance abuse services. Also responsible for program development,
management of all grant and foundation reports, researching new grant opportunities, and oversight of budget and budget planning.

Covenant House California Jan 1998/Oct 2001
Hollywood, CA
Clinical Supervisor Clinical supervision of all Case Management Staff in Shelter, Transitional Living, and Supportive Apartment Program for youth ranging in age from 18-24. Responsibilities included oversight of the case management system, development and implementation of case plans, identifying mental health needs, making appropriate long term housing referrals, and linking youth to services in the community. Also responsible for crisis intervention and assessment of youth with mental health issues. Functioned as liaison between the Psychiatrist and other Mental Health Professionals. In addition, managed all aspects of the Covenant House Abuse and Addition
Management Program. This includes a Day Treatment
Program as well as out patient services. Besides direct supervision other responsibilities include grant writing, the creation of a shelter wide substance abuse and suicidal protocol, and staff training.

Catholic Charities of LA, Inc Oct 1997/Aug 1998
Angel's Flight Runaway and
Homeless Youth Services
Los Angeles, CA
Clinical Services Coordinator Coordinator of all Clinical Services for Shelter and Outreach programs. Responsibilities included: initial
assessments, individual, family, and group therapy, crisis intervention and assessment, development of parenting
program. Implemented outcome measures and quality
control procedures. Also responsible for interfacing with community agencies including, DCFS, Probation, and
LAPD. Development of policy and procedures for clinical, shelter and outreach programs. Supervision of clinical
trainees and interns, and in service training of staff.

Private Practice Aug 1989/ June 2001
Beverly Hills, CA
Individual and family psychotherapy, crisis intervention, school consultation.

Cedars-Sinai Medical Center/ Sept 1987/Oct 1997
Thalians Mental Health Center
Los Angeles, CA
Psychotherapist
Out-Patient Services Individual, group and family therapy with individuals predominately funded through Department of Mental
Health (Medi-Cal, AB 36/32, Short Doyle). Development
of fourteen week parenting skills group in simultaneous cooperation with a latency age skills group. Supervision of art therapy and social work trainees. Custody evaluations and custody counseling. Initial evaluations, treatment
planning, crisis evaluations, school assessments, special education advocacy, and residential placement consultation.

Cedars-Sinai Medical Center/ Sept 1988/May 1993
Thalians Mental Health Center
Los Angeles, CA
Art Therapist
In-Patient Services Group and individual therapy with adolescent and adult populations on an in-patient psychiatric unit. Also attended treatment planning meetings and consulted with staff and treating psychiatrist.

Vista Del Mar June 1991/May 1993
Los Angeles, CA
Therapist Individual and group therapy with residential population.

Supervision of interns, and case consultation with primary social worker of adolescent and latency age residents.

South Bay Children's Center May 1987/June 1989

11.A.k
Packet Pg. 1399 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) Redondo Beach, CA
Therapist Group therapy with adolescents in a day school setting.

Consultation to teachers and social workers.

Penny Lane March 1985/Aug 1987
Sepulveda, CA
Social Worker Individual, group and family therapy in a residential treatment program. The majority of this population
consisted of residents placed through the DCFS, Probation and DMH. Also performed initial assessments, treatment
planning, weekly, monthly and quarterly progress reports, school consultation and crisis intervention counseling.

Involved in supervision of child care staff and program development. Ongoing contact with probation officers and DCFS Social Workers.

Deseret Youth Center Oct 1983/March 1985
Bloomington, CA
Social Worker Individual, group and family treatment with adolescent residents placed through Probation and DCFS. Performed
intakes, initial assessment evaluations, supervision of child care staff. Development of a family outreach program.

Ongoing contact with probation officers and DCFS Social Workers. Also responsible for school placement, including assessing for special education needs.
______________________________________________________________________________

TEACHING EXPERIENCE
UC Santa Cruz-Extension April 1994/May 2000
Santa Cruz, CA
Instructor
Assisted Helen Landgarten during a series of annual three day art therapy class/workshops. Lectured and led small group discussion. Focus of these class/workshops
included:
"Family Art Psychotherapy Theory and Techniques"
"Art Psychotherapy- A developmental perspective"
"Magazine Photo College: A Multi Cultural Technique"
"Art Therapy an Exploration of Mixed Media"

Loyola Marymount University Sept 1986/Dec 1986
Los Angeles, CA
Assistant to the Instructor Assisted Helen Landgarten teach an ART THERAPY WITH CHILDREN class for the Graduate Department of
Art Therapy at Loyola Marymount University.
______________________________________________________________________________

PROFESSIONAL PRESENTATIONS
April 2016 “Reducing Barriers: HUD Policy and Affiliates”, presented at the Family Promise 14th National Conference: The Next Wave, Long Beach, CA.

March 2016 “The Wellness Skills Model: A Research-Based Harm Reduction Program for Integrating Mental Health and Substance Abuse Health Education Interventions for Chronically Homeless Individuals”, presented at the Housing First Partners Conference 2016, Los Angeles, CA.

June 2015 “Merging Mental Health Care with Homeless Service Agencies: the Process, Difficulties and Triumphs, presented at the 8th Annual Housing Institute, California Endowment Center, Los Angeles, CA March 2014 “Using a Coordinated Entry System to Rapidly Re-house Homeless Families”, presented at the Annual Housing First Partners Conference 2014, Chicago, IL.

June 2013 “Housing the Chronically Homeless: An Integrated Approach” – presented at the 6th Annual Housing Institute, California Endowment Center. Los Angeles, CA
June 2012 “Beyond Project 50: Assisting Chronically Homeless Individuals to Retain Housing”, panel member – presented at the DMH Housing Summit Conference 2012, Los Angeles, CA
March 2012 “VA Project 60 – A Housing First Approach with Chronically Homeless Veterans”, panel member - presented at the Housing First Partners' Conference 2012, New Orleans, LA
March 2012 “From the Streets to Housing: Community Partnership in the City of Santa Monica”, panel member -- presented at the Housing First Partners' Conference 2012, New Orleans, LA

11.A.k
Packet Pg. 1400 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) July 2011 “Meeting People Where They Are: Homeless Individuals with High Service Needs”, panel member, presented at the National Conference on Ending Homelessness, Washington DC
March 2011 “Identifying People with a High Mortality Risk for Prioritization into Housing and Community Based Services”, panel member, presented at the REGION IX Health Care for the Homeless 2011 Conference, Sacramento, CA
Oct 2010 “The Vulnerability Index: Categories inherent in the Chronically Homeless Population”, presented at the International Street Medicine Symposium VI,
Los Angeles, CA
Feb 2010 “LESSONS LEARNED: Developing Effective Working Relationships with Public Housing Authorities”, panel presenter at workshop titled, “Getting the most out of Your PHA”, 2010 National Conference on Ending Homelessness, Los Angeles CA
Feb 2004 “THE FORGOTTEN HOMELESS: Addressing the needs of the Elderly”, presented at the Southern California Art Therapy Conference, Los Angeles, CA
March 2003 “Working with the Homeless Elderly”, presented at a conference sponsored by the Community Services Department of the San Bernardino County Homeless Coalition, Ontario, CA.

Sept 2002 “Effective Ways to Work with the Homeless”, presented to the Los Angeles Police Department – Pacific Division, Los Angles, CA.

March 2000 “n Introduction to Art Therapy”, presented to the staff at Children’s Hospital Los Angeles, High Risk Adolescent program, Hollywood, CA.

Aug 1999 “Case Management: A working Model”, presented to the staff at Children’s Hospital Los Angeles, High Risk Adolescent Program- Project NATEEN, Hollywood, CA.

April 1997 "Parenting: What Works, What Doesn't Work", presented at the Westside YMCA, Los Angeles, CA.

May 1996 "Developing Relationships That Last", presented at the Young Adult Conference, St. Monica's Church, Santa Monica, CA.

June 1996 "Art Therapy: A Developmental Perspective", presented to the California Psychiatric Institute, Ph.D. program -Child Development Class, Los Angeles, CA.

March 1994 "Art Therapy with Families", experiential workshop with social work and psychology staff at South Bay Children's Center, Redondo Beach, CA.

Jan 1993 "Art Therapy with an In-Patient Population", presented to the nursing staff at Cedars-Sinai Medical Center/Thalians Mental Health Center, Department of Psychiatry - In-patient Division, Los Angeles, CA.

Oct 1991 "Introduction to Art Therapy with Children", presented to the social work staff at the Family Assistance League, Community Mental Health Program, Hollywood, CA.

Nov 1990 "The use of Art Psychotherapy in the Treatment of Adolescents," presented at the Annual Symposium of the Psychiatric Treatment of Adolescents, Cedars-Sinai Medical Center, Los Angeles, CA.

Oct 1990 "Adolescent Group Art Therapy," presented at the Department of Psychiatry - Grand Rounds, Cedars-Sinai Medical Center/Thalians Mental Health Center, Los Angeles, CA.

Jan 1989 "Revealing Hidden Emotions: Methods of Dealing with Adolescent Depression," presented to the Adolescent Alliance Network, Manhattan Beach, CA.

Nov 1988 "The Use of Art Therapy in Revealing Masked Depression in Adolescence", a clinical paper presented at a symposium on adolescence at the American Art Therapy Association Conference, Chicago, IL.

REFERENCES AVAILABLE UPON REQUEST

11.A.k
Packet Pg. 1401 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

11.A.k
Packet Pg. 1402 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) Appendix G
HCHC Financial Capacity
Years 2020 - 2022

11.A.k
Packet Pg. 1403 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

HOLLYWOOD COMMUNITY HOUSING CORPORATION

AND AFFILIATES
(A NONPROFIT CALIFORNIA CORPORATION)

CONSOLIDATED FINANCIAL STATEMENTS,

SUPPLEMENTARY SCHEDULES,
AND
INDEPENDENT AUDITOR’S REPORT
DECEMBER 31, 2020

HOLLYWOOD COMMUNITY HOUSING CORPORATION AND AFFILIATES
(A NONPROFIT CALIFORNIA CORPORATION)

TABLE OF CONTENTS
DECEMBER 31, 2020
Page No.

Independent Auditor’s Report 1 – 2
Consolidated Financial Statements
Consolidated Statement of Financial Position 3 – 4
Consolidated Statement of Activities and Changes in Net Assets 5 Consolidated Statement of Functional Expenses 6
Consolidated Statement of Cash Flows 7 – 8
Notes to Consolidated Financial Statements 9 – 28
Supplementary Information 29
Schedule I: Consolidating Statement of Financial Position 30 – 31 Schedule II: Consolidating Statement of Activities and Changes in Net Assets (Deficit) 32 Schedule III: Consolidating Statement of Expenses 33

11.A.k
Packet Pg. 1404 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

INDEPENDENT AUDITOR’S REPORT
To the Board of Directors of
Hollywood Community Housing Corporation:

We have audited the accompanying consolidated financial statements of Hollywood Community Housing Corporation (a nonprofit California corporation) and Affiliates (collectively, the Organization), which comprise the consolidated statement of financial position as of December 31, 2020, and the related consolidated statements of activities and changes in net assets, functional expenses, and cash flows for the year then ended, and the related notes to the financial statements.

Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility
Our responsibility is to express an opinion on these consolidated financial statements based on our audit.

We did not audit the financial statements of certain controlled entities, which statements reflect total combined assets of $125,097,837 as of December 31, 2020, and total revenues of $5,646,415 for the year then ended. Those statements were audited by other auditors, whose reports have been furnished to us, and our opinion, insofar as it relates to the amounts included for these wholly owned properties and controlled partnerships, is based solely on the reports of the other auditors. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Organization’s preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Organization’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion on Consolidated Financial Statements
In our opinion, based on our audit and the report of the other auditors, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of the Organization as of December 31, 2020, and the changes in their net assets (deficit) and their cash flows for the year then ended in accordance with accounting principles generally accepted in the United States of America.

Change in Accounting Policy
As described in Note 11 to the consolidated financial statements, management of the Organization has elected to change its method of accounting for the elimination of developer fee revenue earned from Affordable Housing Affiliates. Accordingly, net assets as of December 31, 2019 was adjusted for this change in accounting policy. Our opinion is not modified with respect to this matter.

Report on Supplementary Information
Our audit was conducted for the purpose of forming an opinion on the consolidated financial statements as a whole. The consolidating information in Schedules I through III is presented for purposes of additional analysis of the consolidated financial statements rather than to present the financial position, results of operations, and cash flows of the individual entities, and it is not a required part of the consolidated financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the consolidated financial statements. The information has been subjected to the auditing procedures applied in the audit of the consolidated financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the consolidated financial statements or to the consolidating financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, which insofar as it relates to amounts included for certain affiliates and wholly owned properties based on the reports of other auditors, the information is fairly stated in all material respects in relation to the consolidated financial statements as a whole.

Los Angeles, California
September 9, 2021

11.A.k
Packet Pg. 1405 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A NONPROFIT CALIFORNIA CORPORATION)

CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS OF DECEMBER 31, 2020
Assets
Current assets
Cash and cash equivalents $ 4,475,174
Grants and contracts receivable 160,860
Tenants and accounts receivable 285,182
Deposits 143,240
Prepaid expenses and other current assets 196,138
Note and interest receivable - affiliate 873,153
Restricted cash 640,456
Total current assets 6,774,203
Restricted cash 7,759,516
Property, at cost
Land 41,892,148
Buildings and improvements 242,968,280
Furniture and equipment 3,801,281
Construction in progress and predevelopment costs 75,086,140 Total property, at cost 363,747,849
Less: accumulated depreciation (55,865,594)
Property, net 307,882,255
Investments in and advances to unconsolidated partnerships 12,540 Deferred costs, net 518,818
Total assets $ 322,947,332
See accompanying notes to consolidated financial statements.

Page 3 ends

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A NONPROFIT CALIFORNIA CORPORATION)

CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS OF DECEMBER 31, 2020
Liabilities and Net Assets
Current liabilities
Accounts payable and accrued expenses $ 665,526
Construction and development costs payable 17,425,301
Prepaid rent 97,521
Due to affiliates 27,274
Accrued interest payable, current portion 148,899
Tenant security deposits 675,864
Notes payable, current portion 21,088,511
Total current liabilities 40,128,896
Long-term liabilities
Notes payable, net of current portion and unamortized debt issuance costs 196,326,097 Accrued interest payable, net of current portion 29,159,274 Total long-term liabilities 225,485,371
Total liabilities 265,614,267
Commitments and contingencies (see Notes)
Net assets
Without donor restrictions
Controlling 424,464
Noncontrolling 56,823,601
Total net assets without donor restrictions 57,248,065
With donor restrictions 85,000
Total net assets 57,333,065
Total liabilities and net assets $ 322,947,332
See accompanying notes to consolidated financial statements.

Page 4 ends

11.A.k
Packet Pg. 1406 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A NONPROFIT CALIFORNIA CORPORATION)

CONSOLIDATED STATEMENT OF ACTIVITIES AND CHANGES IN NET ASSETS FOR THE YEAR ENDED DECEMBER 31, 2020
Without With
Donor Donor
Restrictions Restrictions Total
Public support and revenues
Private contributions (corporate, foundation
and individuals) $ 153,798 $ 330,100 $ 483,898
Government contracts and grants 305,923 305,923 -
Special events revenue $ 207,622
Less: direct benefits to donors (15,820) 191,802 191,802 - Management fees 33,034 33,034 -
Rental revenue 9,595,928 9,595,928 -
Other revenue 367,437 367,437 -
Interest income 14,315 14,315 -
Contributed goods and services 55,913 55,913 -
Cancellation of indebtness 278,532 278,532 -
Total revenues 10,996,682 330,100 11,326,782
Net assets released from restrictions:

Satisfaction of program restrictions 309,668 (309,668) - Total public support and revenue 11,306,350 20,432 11,326,782 Expenses
Program services 17,787,026 17,787,026 -
General and administrative 321,541 321,541 -
Fundraising 293,642 293,642 -
Total expenses 18,402,209 18,402,209 -
Change in net assets (deficit) (7,095,859) 20,432 (7,075,427) Net assets, beginning of year, as originally reported 66,286,869 64,568 66,351,437 Change in accounting policy (Note 11) (2,249,396) (2,249,396) - Net assets, beginning of year, as adjusted 64,037,473 64,568 64,102,041 Contributions 306,451 306,451 -
Net assets, end of year $ 57,248,065 $ 85,000 $ 57,333,065 See accompanying notes to consolidated financial statements. 2020

Page 5 ends

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A NONPROFIT CALIFORNIA CORPORATION)

CONSOLIDATED STATEMENT OF FUNCTIONAL EXPENSES
FOR THE YEAR ENDED DECEMBER 31, 2020
Subtotal General
Housing Housing Resident Program and
Operations Development Services Services Administrative Fundraising Salaries, benefits, and taxes $ 2,379,401 $ 141,191 $ 410,615 $ 2,931,207 $ 203,001 $ 169,275 $ 3,3 Utilities 1,401,464 7,052 12,205 1,420,721 2,993 1,252 1,4 Repairs and maintenance 1,562,463 2,155 1,555 1,566,173 933 1,5 390
Property taxes and insurance 322,729 9,393 6,780 338,902 6,854 2,867 3 Professional fees 243,018 63,724 45,998 352,740 80,890 3,335 4 Management fees 776,120 - 776,120 - - 7
-
Advertising 149,028 429 310 149,767 313 4,247 1
Other 245,003 19,768 17,286 282,057 10,259 4,292 2
Office expenses 164,610 11,476 22,575 198,661 8,408 3,518 2 Events 11,344 13,452 9,710 34,506 101,165 - 1
Program furniture and supplies 5,228 52,263 - 57,491 -
-
Asset management fees 19,122 - 19,122 - -
-
Bad debt 21,894 - 21,894 - -
-
Total before depreciation, amortization,
interest and losses 7,301,424 268,640 579,297 8,149,361 313,651 290,341 8,7 Depreciation and amortization 5,814,587 7,907 5,707 5,828,201 5,770 2,414 5,8 Interest expense and finance fees 3,804,462 2,905 2,097 3,809,464 2,120 3,8887 Total expenses by function $ 16,920,473 $ 279,452 $ 587,101 $ 17,787,026 $ 321,541 $ 293,642 $ 18,4 See accompanying notes to consolidated financial statements.

Program Services

11.A.k
Packet Pg. 1407 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A NONPROFIT CALIFORNIA CORPORATION)

CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED DECEMBER 31, 2020
Cash flows from operating activities
Change in net assets $ (7,075,427)
Adjustments to reconcile change in net assets to
net cash provided by operating activities
Depreciation and amortization 5,836,385
Amortization of debt issuance costs 57,883
Cancellation of debt (278,532)
Change in operating assets and liabilities
Grants and contracts receivable (18,519)
Tenants and accounts receivable (135,033)
Deposits 82,759
Prepaid expenses and other current assets (60,369)
Accounts payable and accrued expenses 58,093
Prepaid rent 4,548
Due to affiliates 7,904
Accrued interest payable 3,863,640
Tenant security deposits, liability 5,833
Net cash provided by operating activities 2,349,165
Cash flows from investing activities
Expenditures for property (52,799,861)
Advances to affiliates (601,493)
Cash used in investing activities (53,401,354)
Cash flows from financing activities
Proceeds from notes payable 49,260,369
Repayment of notes payable (1,656,642)
Contributions 306,451
Net cash provided by financing activities 47,910,178
Net change in cash, cash equivalents and restricted cash (3,142,011) Cash, cash equivalents and restricted cash, beginning of year 16,017,157 Cash, cash equivalents and restricted cash, end of year $ 12,875,146 See accompanying notes to consolidated financial statements.

Page 7 ends

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A NONPROFIT CALIFORNIA CORPORATION)

CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED DECEMBER 31, 2020
Supplemental disclosure of cash flow information:

Cash paid for:

Interest, net of capitalized interest of $852,197 $ 972,332 Noncash investing and financing activities:

Accrual of additions to property $ 7,803,664
See accompanying notes to consolidated financial statements.

Page 8 ends

11.A.k
Packet Pg. 1408 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

HOLLYWOOD COMMUNITY HOUSING CORPORATION AND AFFILIATES
(A NONPROFIT CALIFORNIA CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2020

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1. ORGANIZATION
Hollywood Community Housing Corporation (HCHC) is a community-based nonprofit California corporation organized for the purpose of providing affordable housing for low-income people. This is accomplished through acquisition, construction, rehabilitation, and operations of residential properties in a manner that enhances existing neighborhoods. HCHC’s affiliates are comprised of affordable housing affiliates. Collectively, these entities are referred to as the Organization.

HCHC wholly owns and operates the following:
 Argyle Court Apartments is a 23-unit complex located in Los Angeles, California, which provides permanent housing for families with low income.
 Orchard Gables is a restored City Historic-Cultural Monument which serves as offices for two community nonprofits and is located in Los Angeles, California.

HCHC is the single member in the following limited liability companies:
 HCHC Laundry, LLC (HCHC Laundry) was formed for the purpose of owning, constructing, and operating a neighborhood laundry facility located in one of HCHC’s affordable housing developments. On April 25, 2019, the Organization’s board of directors agreed to dissolve HCHC Laundry and ceased operations of the laundromat by September 1, 2019. In 2020, all accounts were settled and HCHC Laundry, LLC was fully dissolved on May 1, 2020.  Hollywood Housing Holdings, LLC (HHH) is a California limited liability company organized for the purpose of assisting HCHC in the development and management of affordable housing properties located in Los Angeles County, California.

In addition, HCHC controls affordable housing affiliate entities (Affordable Housing Affiliates) consisting of limited partnerships, limited liability companies and two nonprofit organizations regulated by the United States Department of Housing and Urban Development (HUD) Section 811 Program in which HCHC has both an economic interest and control of the organizations through a majority voting interest in their governing boards. Accordingly, the assets, liabilities, support, revenues and expenses of the following affiliated entities are consolidated in the financial statements of HCHC.

The following is a summary of limited liability companies (LLC) established to own up to a 1% general partner interest in Affordable Housing Affiliates:

General Partner Affordable Housing Affiliates
Alexandria House Apartments LLC Alexandria
HCHC Recap I, LLC Recap
Step Up on Colorado LLC Step Up on Colorado
Step Up on Vine LLC Step Up on Vine
HCHC General Partner LLC Coronel
Stanford Avenue GP, LLC Stanford
(Continued)

HOLLYWOOD COMMUNITY HOUSING CORPORATION AND AFFILIATES
(A NONPROFIT CALIFORNIA CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
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General Partner Affordable Housing Affiliates
HCHC Florence Mills GP, LLC Florence Mills
HCHC Gramercy Place GP, LLC Gramercy
HCHC Palm Vista MGP, LLC Palm Vista
HCHC Walnut Park GP, LLC Walnut Park
HCHC Luna Vista GP, LLC Luna Vista
The following is a summary of Affordable Housing Affiliates and the consolidated ownership information as of December 31, 2020:

Affordable Housing Entities Owner Interest # of Units
Dunning Apartments Partnership, L.P. 100.00% 26
Kenmore Apartments, L.P. 100.00% 21
Mirada Terrace Apartments, L.P. 100.00% 30
Selma-Hudson Community, L.P. 100.00% 30
St. Andrew’s Community L.P. 100.00% 16
Barnsdall Court, L.P. 100.00% 38
Innes Heights, L.P. 100.00% 19
Harold Way Apartments, L.P. 100.00% 51
Views at 270, L.P. 100.00% 56
Alexandria House Apartments, L.P. (Alexandria) 0.0051% 16 HCHC Recap I, L.P. (Recap) 0.01% 68
Hollywood Bungalow Courts, L.P. 0.01% 42
Mariposa Place Apartments, L.P. 0.01% 58
Palomar Apartments, L.P.* 0.01% 27
Palo Verde Apartments, L.P. 0.01% 49
Coronel Apartments, L.P. (Coronel) 0.01% 54
Paul Williams Apartments, L.P. (Paul Williams) 0.01% 41 Step Up on Colorado, L.P. (Step Up on Colorado) 0.005% 34 Step Up on Vine, L.P. (Step Up on Vine) 0.005% 34
Florence Mills Apartments, L.P. (Florence Mills) * 0.01% 74 Stanford Avenue Apartments, L.P. (Stanford) 0.01% 85
Gramercy Place Apartments, L.P. (Gramercy) * 0.01% 64
Allesandro Housing 811-01 (Allesandro) NA 18
Hollywood Housing 811-97-Waterloo Heights Apts (Waterloo) NA 18 Luna Vista, LP (Luna Vista) 100.00% 73
Walnut Park, LP (Walnut Park) 100.00% 64
Total units 1,106
* Project was under construction or development in 2020.

Description of Programs The Organization improves the quality and affordability of housing in Los Angeles County by developing new apartments and rehabilitating existing properties. Organization properties are clustered in different parts of Los Angeles County and serve low-income households.  Housing Operations HCHC’s housing operations includes the operations of the Affordable Housing Affiliates and its asset management department which develops and implements strategies to ensure the long-term health of its properties for the benefit of its residents. The

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(A NONPROFIT CALIFORNIA CORPORATION)

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department monitors the lease-up process of new buildings, supervises property management operations, analyzes financial performance, imposes control over property maintenance, mediates resident grievances, and works with its housing development department on design considerations for new buildings. The asset management team actively seeks out ways to lower operating expenses, primarily through green initiatives and energy savings programs.  Housing Development HCHC's core programs include the development of affordable housing and permanent supportive housing. Since its inception, HCHC has developed 28 properties that house over 2,200 people in 951 units of safe, attractive and centrally located affordable housing.

Residents of HCHC properties have extremely low- to low-incomes, typically earning below 60% of the area median income. Over 30% of HCHC's housing units are designated for special-needs individuals and their families, those disabled by HIV/AIDS, formerly chronically homeless individuals and/or persons living with co-occurring and multiple conditions. Two of HCHC's buildings serve only seniors, one specifically for seniors with special needs.  Resident Services HCHC's resident services program provides care coordination, referral and linkage to resources, crisis intervention, a food pantry, ESL classes, GED instruction, group/individual therapy, and life-skills classes. When circumstances like a pandemic are not a factor, HCHC's Food Pantry is open once a week to HCHC residents and the community at large and provides 300 households, comprised of nearly 800 individuals with food staples, meat, and vegetables every month. People accessing the food pantry include a number of special-needs residents who live in HCHC communities, low-income households in the neighboring community, and individuals who identify as homeless.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation The consolidated financial statements have been prepared on the accrual basis of accounting, in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP) and include the accounts of HCHC, wholly owned subsidiaries and all of its controlled affiliates. The controlled affiliates are included in the consolidation in accordance with U.S.

GAAP, which require that the partnership or company accounts be consolidated for all limited partnerships and limited liability companies which are deemed to be controlled by the Organization.

All significant intercompany balances and transactions have been eliminated in consolidation. The noncontrolling interests in the consolidated limited partnerships are shown separately in the components of net assets (deficit).

Classes of Net Assets Net assets of the Organization and changes therein are classified based on the existence or absence of donor or grantor-imposed restrictions. Accordingly, net assets and changes have been classified and are reported as follows:

Net Assets Without Donor Restrictions:
 Controlling Net assets not restricted by donor-imposed stipulations and are available for use at the discretion of the board of directors and/or management for general operating purposes. The only limits on net assets are broad limits resulting from the nature of the Organization and the purposes specified in its articles of incorporation or bylaws and, perhaps, limits resulting from contractual agreements. From time to time the board

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(A NONPROFIT CALIFORNIA CORPORATION)

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DECEMBER 31, 2020

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designates a portion of these net assets for specific purposes which makes them unavailable for use at management’s discretion (Note 10).
 Noncontrolling Net assets that represent the aggregate balance of the third party limited partners’ equity interest, generally 99.99%, in the controlled limited partnerships that are included in the consolidated financial statements.

Net Assets With Donor Restrictions Net assets of the Organization resulting from contributions and other inflows of assets whose use by the Organization is limited by donor-imposed stipulations.

Some donor-imposed restrictions are temporary in nature, such as those that will be met by the passage of time or other events specified by the donor. Other donor-imposed restrictions are perpetual in nature, where the donor stipulates that resources will be maintained in perpetuity.

Donor-imposed restrictions are released when a restriction expires, that is, when the time has elapsed, when the stipulated purpose for which the resource was restricted has been fulfilled, or both and the net assets are reclassified as net assets without donor restrictions and reported in the consolidated statement of activities as net assets released from restrictions.

Cash, Cash Equivalents, and Restricted Cash For purposes of the consolidated statement of financial position and statement of cash flows, cash and cash equivalents consist of cash and highly liquid unrestricted investments with an original maturity of three months or less when purchased.

The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the consolidated statement of financial position that sum to the totals of the same such amounts presented in the consolidated statement of cash flows:

As of December 31, 2020
Cash and cash equivalents $ 4,475,174
Restricted cash:

Restricted reserves 7,759,516
Tenant security deposits 640,456
Cash, cash equivalents and restricted cash $ 12,875,146 Restricted Reserves The Organization has set up certain operating, replacement, development and other reserve accounts and continues to make annual deposits as required by the various loan and regulatory agreements. In addition, restricted reserves also include tenant security deposits and development reserves restricted by lenders to be used for development purposes.

Accounts, Grants and Tenant Receivables Accounts, grants and tenant receivables are charged to bad debt expense when they are determined to be uncollectible based upon a periodic review of the accounts by management. U.S. GAAP requires that an allowance method be used to recognize bad debts; however, the effect of using the direct write-off method is not materially different from the results that would have been obtained under the allowance method.

Property Property, including projects under development, is stated at cost.

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HOLLYWOOD COMMUNITY HOUSING CORPORATION AND AFFILIATES
(A NONPROFIT CALIFORNIA CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2020

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Depreciation and amortization of building and building improvements, furniture and equipment and leasehold improvements are provided using the straight-line method over the following estimated useful lives:

Description Life
Buildings and improvements 27.5 – 40 years
Furniture and equipment 3 – 7 years
Leasehold improvements Lesser of life or lease
The Organization capitalizes expenditures or betterments that materially increase asset lives and charges ordinary repairs and maintenance to operations as incurred. Costs of projects under development include direct and indirect costs of construction and carrying costs including, interest, property tax and insurance incurred during the development period. When assets are sold or otherwise disposed of, the costs and related accumulated depreciation are removed from the accounts, and any resulting gain or loss is included in operations. Interest costs directly related to, and incurred during, a project’s construction period are capitalized. Capitalized interest amounted to $852,197 for the year ended December 31, 2020.

The Organization reviews its property for impairment whenever events or circumstances indicate that the carrying value of such property may not be recoverable. When evaluating recoverability, management considers future undiscounted cash flows estimated to be generated by the property including any estimated proceeds from the eventual disposition. In the event these accumulated cash flows are less than the carrying amount of the property, the Organization recognizes an impairment loss equal to the excess of the carrying amount over the estimated fair value of the property. No impairment loss has been recognized during the year ended December 31, 2020.

Predevelopment Project Costs HCHC incurs costs in connection with properties it is considering for development as well as costs associated with properties in the initial state of development.

HCHC capitalizes these costs until the project is transferred to a separate entity or charges the costs to operations at the time it is determined the project is not feasible. Predevelopment project costs are included in property and equipment in the accompanying consolidated statement of financial position. Abandoned projects are expensed when management determines the project is not feasible. There were no abandoned project costs for the year ended December 31, 2020.

Deferred Costs Deferred costs consist of California Tax Credit Allocation Committee (TCAC) monitoring fees which are amortized over 10-15 years and other deferred costs amortized over one to 55 years. Deferred costs are as follows:

At December 31, 2020
TCAC fees $ 759,951
Other deferred costs 66,386
Less: accumulated amortization (307,519)
Deferred costs, net $ 518,818
Debt Issuance Costs Debt issuance costs, net of accumulated amortization, are reported as a direct reduction of the obligation to which such costs relate. Amortization of debt issuance costs is reported as a component of interest expense and is recorded using a method that approximates the effective interest method. Amortization of debt issuance costs is capitalized to construction in progress and development costs during development.

HOLLYWOOD COMMUNITY HOUSING CORPORATION AND AFFILIATES
(A NONPROFIT CALIFORNIA CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2020

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Public Support and Revenue Recognition The Organization recognizes contributions when cash, securities or other assets or an unconditional promise to give is received. Conditional promises to give, that is, those with a measurable performance or other barrier and a right of return, are not recognized until the conditions on which they depend have been met. Any funds received in advance of a condition being met are recorded as a liability.

The Organization receives cost-reimbursable contract and grant funding from state and local agencies for providing permanent housing and supportive services which are conditioned upon certain performance requirements and/or the incurrence of allowable qualifying expenses. Amounts received are recognized as revenue when the Organization has incurred expenditures in compliance with specific contract or grant provisions. Amounts received prior to incurring the qualifying expenditures are reported as a liability.

Revenue from rental property is recognized as rents become due. Rental payments received in advance are deferred until earned. All leases between the Organization and its tenants are operating leases. Included in rental revenue is other income from laundry, vending and miscellaneous charges to tenants. Such other income is recognized when earned.

Revenue from special events include individual and corporate contributions and are recognized when the event is held. The related expenses are recognized on the date of the event. The contributions received for special events scheduled to occur after year-end are recorded as deferred revenues and recognized as revenues on the date of the event. Revenue from these events are included in contributions and the related direct expenses are included in events expense in the accompanying consolidated statement of activities and change in net assets (deficit).

Revenue from program service fees, including partnership project management fees, is recognized over time as services are performed.

Developer Fees Developer fees are recognized over the development period under a percentage of completion method based on the development costs incurred as a percentage of the total development costs expected. Amounts not received by the completion date are recorded as a receivable. The gross profit on developer fees earned from Affordable Housing Affiliates is eliminated in consolidation. Management determines the gross profit on developer fees based on project costs which include consultants, internal salaries and benefits, overhead and other nonreimbursed costs (Note 11).

Contributed Goods and Services Contributed goods and services are recorded as contributions at their estimated fair values at the date of donation. Contributions of services are recognized if the services received create or enhance non-financial assets or require specialized skills, and would typically need to be purchased if not provided by donation. For the year ended December 31, 2020, the Organization’s contributed services totaling $3,650 and goods totaling $52,263.

Investments in Unconsolidated Partnerships The Organization holds investments in limited partnerships that are not consolidated as they are not controlled by the Organization (Note 4). The ownership interests range from 0.005% to 20.0% and are accounted for under the equity method, since the Organization has significant influence over the major operating and financial policies of the limited partnerships. The Organization's cost is increased for its share of profits and contributions, and reduced by distributions and its share of losses.

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(A NONPROFIT CALIFORNIA CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
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The Organization evaluates its investments in limited partnerships for impairment in value and records a write-down if it is determined that any impairment in value is other than temporary. No such write-downs have been recorded in the accompanying consolidated financial statements.

Functional Allocation of Expenses The cost of providing various programs and other activities of the Organization has been summarized by function and natural classification in the accompanying consolidated statement of functional expenses. Expenses that are directly attributable to a specific functional classification of HCHC are reported as expenses in those functional areas. Shared general and administrative expenses that benefit multiple functional areas are allocated among the various functions using a percentage method. The allocation methodology is periodically reviewed by management for relevancy and accuracy.

The functional classifications are defined as follows:
 Program service expenses consist of costs incurred in connection with providing services and conducting programs.
 General and administrative expenses consist of costs incurred in connection with the overall activities, which are not allocable to another functional expense category.  Fundraising expenses consist of costs incurred in connection with activities related to obtaining grants and activities designed to generate revenue.

Income Taxes The nonprofit entities consolidated in these consolidated financial statements have been granted an exemption from federal income taxes under Section 501(c)(3) of the Internal Revenue Code and Section 23701(d) of the California Revenue and Taxation Code. For the year ended December 31, 2020, no provision for unrelated business income taxes has been made.

Income taxes on limited partnership and limited liability company income are included in the tax returns of the partners or members. The federal tax status as a pass-through entity is based on its legal status as a limited partnership or limited liability company and is required to file tax returns with the IRS and other taxing authorities. Accordingly, these consolidated financial statements do not reflect a provision for income taxes. However, the limited partnerships and the limited liability companies are required to pay an $800 fee to the California Franchise Tax Board. The Organization determined there are no tax positions which must be considered for disclosure. With few exceptions, the Organization is no longer subject to income tax examinations by tax authorities for years before 2015. There are no current tax examinations pending.

Concentrations of Business and Credit Risk HCHC, either as direct owner or general partner, has an economic interest in real estate projects (Projects). The Projects rent to residents of Los Angeles County with qualifying levels of income who live in the Los Angeles area and/or to people who receive public assistance. The Projects are subject to business risks associated with the economy and level of unemployment in California and available subsidies, which affect occupancy as well as the tenants’ ability to make rental payments.

HOLLYWOOD COMMUNITY HOUSING CORPORATION AND AFFILIATES
(A NONPROFIT CALIFORNIA CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2020

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In addition, the Projects operate in a heavily regulated environment. The operations of the Projects are subject to the administrative directives, rules and regulations of federal, state and local regulatory agencies, including, but not limited to, TCAC and HUD. Such administrative directives, rules and regulations are subject to change by an act of Congress or an administrative change mandated by HUD and may occur with little notice or inadequate funding to pay for the related cost, including the additional administrative burden, to comply with a change.

HCHC receives a significant amount of revenue from partnerships in which it is the general partner, as well as from grants. These sources of funds are dependent upon the continued successful development of affordable housing projects by the Organization, as well as the availability of funds from state and local programs. For the year ended December 31, 2020, the Organization had no private grants, which accounted for more than 10% of its public support and revenues. For the year ended December 31, 2019, the Organization had no private grants, which accounted for more than 10% of its public support and revenues.

HCHC provides advances to affiliates involved in the development of affordable housing projects and has deferred receipt of developer fees and partnership management fees from affiliates. Such advances and fees are unsecured and realization of fees is dependent upon the success of these projects. The advances and fees have been eliminated in consolidation.

The Organization’s cash and cash equivalents are maintained in various bank accounts. The Organization has exposure to credit risk to the extent that its cash and cash equivalents exceed amounts covered by federal deposit insurance. The Organization believes that its credit risk is not significant.

Property Tax Exemption The Projects are generally exempt from real property taxes for the residential portion of its affordable housing real estate properties. In the event such exemption is not renewed or no longer available, the Projects’ cash flow would be negatively impacted.

Use of Estimates The preparation of consolidated financial statements in conformity with U.S.

GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and reported amounts of revenues and expenses during the reporting period. Such estimates include the treatment of contingent interest to be forgiven if the properties comply with loan requirements, and the allocation of functional expenses. Actual results may differ from those estimates.

New Accounting Standards In May 2014, the Financial Accounting Standards Board issued Accounting Standards Update 2014-09, Revenue from Contracts with Customers (Topic 606) (ASU 2014-09) providing new revenue recognition guidance that superseded existing revenue recognition guidance. The update, as amended, requires the recognition of revenue related to the transfer of goods or services to customers reflects the consideration to which the entity expects to be entitled in exchange for those goods or services, as well as additional qualitative and quantitative disclosures about revenues. The Organization adopted the new revenue recognition guidance as of January 1, 2020 using the modified retrospective method of transition for all contracts that were not completed as of that date. Adoption of the new revenue recognition guidance resulted in no significant changes in the way the Organization recognized revenue and therefore no changes to the previously issued audited consolidated financial statements were required on a retrospective basis as a result of the

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HOLLYWOOD COMMUNITY HOUSING CORPORATION AND AFFILIATES
(A NONPROFIT CALIFORNIA CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
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adoption of Topic 606. However, an adjustment to beginning net assets was recorded with respect to the elimination of developer fee revenue earned from Affordable Housing Affiliates (Note 11).

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). This standard establishes a right-of-use (ROU) model that requires a lessee to record an ROU asset and a lease liability, measured on a discounted basis, on the statement of financial position for all leases with terms greater than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the consolidated statement of activities and change in net assets (deficit). A modified retrospective transition approach is required for capital and operating leases existing at the date of adoption, with certain practical expedients available. The standard is effective for annual reporting periods beginning after December 15, 2020 and was subsequently amended with ASU 2020-05, Revenue from Contracts with Customers and Leases: Effective Dates for Certain Entities, allowing deferral to reporting periods beginning after December 15, 2021. The use of either the retrospective or cumulative effect transition method is permitted. The Organization is currently evaluating the impact the adoption of ASU 2016-02 on January 1, 2022 will have on its consolidated financial statements.

3. LIQUIDITY AND AVAILABILITY
The Organization structures its financial assets to be available as its general expenditures, liabilities, and other obligations come due.

Financial assets without donor restrictions or other restrictions limiting their use that can be readily made available within one year of the consolidated statement of financial position date, comprise the following:
2020
Financial assets at year-end:

Cash, cash equivalents, and restricted cash $ 12,875,146 Grants and contracts receivable 160,860
Tenants and accounts receivable 285,182
Total financial assets 13,321,188
Less amounts not available to be used within one year:

Board designated cash (800,000)
Net assets with purpose restriction (85,000)
Restricted cash (8,399,972)
Financial assets not available to be used within one year (9,284,972) Financial assets available to meet general expenditures within one year $ 4,036,216 As part of liquidity management, the board approved an organizational operating reserve fund that could be made available for current use with board approval. Restricted cash, although restricted for purpose, can be utilized to cover salaries and other operating costs as restrictions are met. In addition, the Organization maintains an operating line of credit for additional liquidity (Note 7).

HOLLYWOOD COMMUNITY HOUSING CORPORATION AND AFFILIATES
(A NONPROFIT CALIFORNIA CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
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The Affordable Housing Affiliates have been established to develop and operate affordable housing.

As a result, the Affordable Housing Affiliates have been structured in such a way to be self-sufficient regarding its liquidity needs. In the event of unplanned liquidity needs over and above that which is provided by their operations, they have access to cash reserves, reported as restricted cash, subject to lender and limited partner withdrawal approval. Included in financial assets available to meet general expenditures within one year are Affordable Housing Affiliates cash and cash equivalents which are available for general operation. In addition, in the normal course of business while under development, the Affordable Housing Affiliates rely on receiving funds from non-recourse permanent loan commitments and limited partner capital contributions. In the event the Affordable Housing Affiliates are unable to meet their liquidity needs, HCHC has provided limited guaranties to fund operating deficits. As of December 31, 2020, the Organization’s management believes they have sufficient liquidity availability to meet its obligations for the coming year.

4. INVESTMENT IN UNCONSOLIDATED PARTNERSHIPS

HCHC and its affiliates hold investments in limited partnerships that are not consolidated. Each partnership is a California limited partnership organized for the purpose of developing and operating low-income housing. As a general partner in the partnerships, the Organization is contingently liable for the obligations of the partnerships. Pursuant to the terms of the partnership agreements, limited partners are responsible only for initial capital contributions. As a result, the Organization may be required to arrange for additional funds related to the rehabilitation or operating needs of the partnerships.

The following is a summary of the financial information of HCHC’s equity interest in limited partnerships not controlled by HCHC and accounted for in accordance with the equity method:

Owner
Interest Total Assets
Total
Liabilities
Partners’
Equity
(Deficit)
Partners’
Net Loss
HCHC
Equity
As of December 31, 2020:

La Brea Franklin LP 20.000% $ 2,459,481 $ 7,381,067 $ (4,921,586) $ (218,580) $ (2,842) Western Carlton Apts LP 0.100% $ 6,665,809 $ 5,776,481 $ 889,328 $ (18,180) $ - Western Carlton II LP 0.005% $ 8,499,057 $ 8,229,414 $ 269,643 $ 43,568 $ - Palm Vista LP 49.005% $ 8,727,571 $ 8,634,636 $ - $ 92,935 $ -

5. RESTRICTED CASH
Restricted cash consists of the following:

As of December 31, 2020
Operating reserves $ 2,670,786
Replacement reserves 3,272,225
Interest reserves 329,954
Security deposits 640,456
Other reserves 1,486,551
Total restricted cash $ 8,399,972

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6. RELATED PARTY TRANSACTIONS
The Organization has significant related party transactions with affiliates, including the unconsolidated partnerships (Note 4). The Organization provides development and administrative services and also advances funds to affiliates to fund development activities.

Management and Other Fees Revenue HCHC earns management fees, tenant resident service fees and accounting fees in connection with services rendered to the Affordable Housing Affiliates under various terms and provisions. Such fees are eliminated in consolidation. In addition, for the year ended December 31, 2020, HCHC earned approximately $33,000 in management fees from the unconsolidated limited partnerships.

Office Facility HCHC purchased its office facility which is located within the Mariposa Place Apartments, L.P.’s (of which HCHC is the General Partner) affordable housing complex. Along with the purchase agreement, HCHC and Mariposa Place entered into a separate reciprocal easement agreement, which provided permanent easements, subject to covenants and restrictions per terms of the easement agreement. The reciprocal easement agreement was amended in January 2012 to include requirements that HCHC make annual payments to Mariposa Place for parking spaces of $3,840 and 7.55% of the annual building insurance costs.

In addition, HCHC entered into a master commercial lease agreement with Mariposa Place for additional commercial space located at the complex. The commercial lease agreement was amended in January 2012. The lease has a 30-year term expiring December 31, 2039. The lease also requires HCHC to pay an annual rent of $1 over the life of the lease, plus its proportional share of operating expenses. The rental income and related expense related to the office facility and lease eliminates in consolidation.

Note Receivable from Investee Entity The Organization has a note receivable agreement with investee entities (Note 4), secured by a deed of trust on the property owned and developed by the respective entity, bearing interest at 7%. The principal and the interest were fully repaid on July 7, 2021.

The balance of the note and interest receivable is as follows:

At December 31, 2020
Palm Vista, L.P. $ 873,153

7. NOTES PAYABLE
Notes payable consist of unsecured debt and collateralized trust deeds on real property and improvements as follows:

As of December 31, 2020
HCHC:

Unsecured subordinate loan ($500,000) with Wells Fargo Bank, bearing interest at 2% per annum. Interest only payable in quarterly installments through October 2021; thereafter principal payments of $62,500 plus interest payments due quarterly, any unpaid principal and accrued interest are due October 2023. $ 500,000

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As of December 31, 2020
Line-of-credit ($500,000) with Union Bank, secured by Organization assets, interest accruing at a rate of 0.5% per annum above the reference rate determined by Union Bank as of December 31, 2020. Interest only payable in monthly installments. On April 2021, the line of credit was renewed for one year and was converted to a unsecured loan. At December 31, 2020, $500,000 was available for borrowing on the line-of-credit. The line-of-credit is subject to certain bank covenants, as defined in the lender Covenant Agreement. The Organization was in compliance with the covenants as of December 31, 2020. -
Note payable to HCIDLA, secured by the deed of trust on real property and assignment of rents, simple annual interest at 5.0%, interest payable from residual receipts, as defined, and all unpaid principal and interest are due November 2061. 3,132,000 Residual receipts note payable to the City of Los Angeles (City), in the original amount of $1,113,875, secured by a deed of trust on real property, bearing interest at 5.0% per annum. Payable in annual installments of principal and interest based on residual receipts, until all amounts have been paid in full, due October 2030. 1,113,875 Residual receipts note payable to the City, in the original amount of $1,240,715, secured by a deed of trust on real property, bearing interest at 5.0% per annum. A $50,000 interest free portion is to be repaid as to principal only out of the same residual receipts. Payable in annual installments of principal and interest based on

77.54% of residual receipts, until all amounts have been paid in full, due November 2038. 1,190,715
Note payable to City National Bank (CNB), pursuant to the regulations governing the Federal Home Loan Bank Affordable Housing Program (AHP) in the original amount of $400,000, secured by a deed of trust on real property, bearing no interest, unpaid principal due November 15, 2072. 400,000
Note payable to CNB, pursuant to the regulations governing the AHP in the original amount of $480,000, secured by a deed of trust on real property, bearing no interest, unpaid principal is due December 16, 2071. 480,000 Note payable to Bank of America, in the original amount of $530,000, secured by a deed of trust on real property, bearing no interest, unpaid principal is due December 1, 2074. 530,000
Notes payable to Nonprofit Finance Fund (NFF), original borrowings up to $1,500,000, unsecured, annual interest at 5.50% to be used for interim financing for properties in predevelopment. At December 31, 2020, $1,500,000 was available for borrowing. -

11.A.k
Packet Pg. 1414 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

HOLLYWOOD COMMUNITY HOUSING CORPORATION AND AFFILIATES
(A NONPROFIT CALIFORNIA CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2020

Page 21 ends

As of December 31, 2020
Deferred note payable to the City, in the original amount of $1,910,915, secured by a deed of trust on real property, bearing interest at 3.0% per annum. Beginning in 2012, the lender makes an annual determination if the property has been maintained in accordance with the loan agreement, as defined. If determined to be in compliance, 5.0% of the principal balance and all interest that was accrued for the year shall be deemed paid to the lender. Any amount of unpaid principal and accrued interest shall be due in full January 2031. 1,047,853 Note payable to the City, in the original amount of $437,479, secured by a deed of trust on real property, bearing interest at 5.0% per annum, payable in annual installments of principal and interest based on residual receipts, as defined, until all amounts have been paid in full, due the earlier of March 2037 or at the time of sale or refinancing. Subject to possible interest forgiveness provisions at the end of the loan term. 435,498
Note payable to the City, in the original amount of $1,200,000, secured by a deed of trust on real property, non-interest bearing, payable annually based on residual receipts, until all amounts have been paid in full, due the earlier of March 2037 or at time of sale or refinancing. 1,200,000
Note payable to the City, in the original amount of $135,000, secured by a deed of trust on real property, non-interest bearing, payable annually based on residual receipts, until all amounts have been paid in full, due at time of sale or refinancing. 135,000 Note payable to the Century Housing Corporation, in the original amount of $3,500,000 secured by deed of trust on real property, compound interest at LIBOR plus 4% with a floor rate of 6.5% is due monthly. Unpaid principal and interest were due October 2021. In August 2021, the maturity date was extended to October 2022. 3,500,000
Unsecured predevelopment note payable to Low Income Investment Fund, in the amount of $750,000, bearing interest at 6.22% per annum which is paid monthly. All unpaid principal and accrued interest were due August 9, 2021. In August 2021, the maturity date was extended to December 2022. 660,876
Note payable to Low Income Investment Fund, in the amount of $3,600,000, secured by deed of trust on real property, bearing interest at 5.47% per annum which is paid monthly. All unpaid principal and accrued interest were due August 9, 2021. In August 2021, the maturity date was extended to December 2022. 3,600,000 Note payable to Century Housing Corporation, in the original amount of $1,500,000 secured by deed of trust on real property, compound interest at LIBOR plus 4% with a floor rate of 6.5% is due monthly. Unpaid principal and interest are due October 15, 2021. 779,508

HOLLYWOOD COMMUNITY HOUSING CORPORATION AND AFFILIATES
(A NONPROFIT CALIFORNIA CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2020

Page 22 ends

As of December 31, 2020
Controlled Limited Partnerships:

Seven amortizing notes payable to various lenders, secured by deeds of trust on real property, bearing interest ranging from 2.40% to 8.45% per annum, principal and interest due date ranging from August 2024 to December 1, 2039. 8,262,409 Three construction notes payable to various lenders, secured by deeds of trust on real property, interest ranging from 3.20% to 3.5% per annum, principal and interest due date ranging from October 2021 to May 1, 2039 with an option to extend. The committed sources of repayment include proceeds from permanent debt or limited partner capital contributions. 45,829,133
Forty-five non-amortizing notes payable to various lenders, secured by deeds of trust on real property, interest ranging from zero to 5.96% per annum, payable based on residual receipts, as defined, until all amounts have been paid in full, due date ranging from June 2021 to December 1, 2073. 113,723,539 Wholly Owned Limited Partnerships:

Four amortizing notes payable to various lenders, secured by deeds of trust on real property, bearing interest ranging from 4.0% to 7.0% per annum, principal and interest due date ranging from May 2026 to October 1, 2029. 5,790,467 Fourteen non-amortizing notes payable to various lenders, secured by deeds of trust on real property, interest ranging from zero to 5.96% per annum, payable based on residual receipts, as defined, until all amounts have been paid in full, due date ranging from August 2028 to October 2053. Certain amounts of the notes payable are subject to interest forgiveness provisions (see below). 20,476,594 HUD 811 Entities:

Two non-amortizing notes payable to HUD under Section 811 of the Housing Act, in the original amount of $3,514,300, non-interest bearing. Loan forgiveness as stipulated in the loan agreements remain in effect as long as the properties are operated and maintained as low-income housing for the disabled. 3,514,300 Five non-amortizing notes payable to various lenders, secured by deeds of trust on real property, interest ranging from zero to 5% per annum, payable based on residual receipts, as defined, until all amounts have been paid in full, due date ranging from April 2031 to December 2043. 2,712,290
Total notes payable 219,014,057
Less: unamortized debt issuance costs (1,599,449)
Subtotal 217,414,608
Less: current portion (21,088,511)
Total, noncurrent portion $ 196,326,097

11.A.k
Packet Pg. 1415 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

HOLLYWOOD COMMUNITY HOUSING CORPORATION AND AFFILIATES
(A NONPROFIT CALIFORNIA CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2020

Page 23 ends

Required principal repayments of notes payable are as follows:

Year Ending December 31, Amount
2021 $ 21,088,511
2022 22,369,701
2023 12,973,725
2024 764,273
2025 589,338
Thereafter 161,228,509
Total $ 219,014,057
An analysis of principal and accrued interest for 2020 on notes payable are as follows:

Principal Accrued
Current Noncurrent Balance as Interest as
Portion Portion of 12/31/20 of 12/31/20
HCHC:

Amortizing $ 95,545 $ 952,308 $ 1,047,853 $ 25,283
Non-amortizing 5,040,383 12,617,089 17,657,472 118,753
Total HCHC 5,135,928 13,569,397 18,705,325 144,036
Principal Accrued
Current Noncurrent Balance as Interest as
Portion Portion of 12/31/20 of 12/31/20
Controlled LP:

Amortizing $ 223,921 $ 8,038,488 $ 8,262,409 $ 1,359
Construction 15,548,239 30,280,894 45,829,133 73,915
Non-amortizing - 113,723,539 113,723,540 15,337,600
Total Controlled LP 15,772,160 152,042,921 167,815,081 15,412,874 Wholly Owned LP:

Amortizing 180,423 5,610,044 5,790,467 5,624
Non-amortizing - 20,476,594 20,476,594 12,425,874
Total Wholly Owned LP 180,423 26,086,638 26,267,061 12,431,498 HUD 811 Entities:

Amortizing - - - -
Non-amortizing - 6,226,590 6,226,590 1,319,765
Total HUD 811 Entities - 6,226,590 6,226,590 1,319,765
Total $ 21,088,511 $ 197,925,546 $ 219,014,057 $ 29,308,173 Included in current maturities as of December 31, 2020 is construction debt totaling $15,548,239, that has committed sources of repayment including proceeds from permanent long term debt and or limited partner investor equity.

HOLLYWOOD COMMUNITY HOUSING CORPORATION AND AFFILIATES
(A NONPROFIT CALIFORNIA CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2020

Page 24 ends

HCHC received loan proceeds of $6,846,590, in connection with eight separate loan agreements, interest ranging from 0% to 5% per annum, with maturity dates between 2030 and 2074 for the purpose of developing affordable housing. The lenders allowed HCHC to subsequently assign the real property and its rights under the loan agreements to certain Affordable Housing Affiliates, of which HCHC participates as the General Partner. Because the funds were part of government program grants that require the loans to remain with HCHC, the security interest for the loans are crossed collateralized against real property assigned to the Affordable Housing Affiliates.

Concurrent with the execution of these loans, HCHC received $6,846,590 in promissory notes from the Affordable Housing Affiliates, the terms of which were identical to the loans payable to the lenders. Proceeds due under the notes receivable will be used to offset the identical payments due under the notes payable.

Contingent Interest A regulatory agreement with the City of Los Angeles provides for possible forgiveness of interest on the Dunning Apartments mortgage note payable of $1,479,564, the St.

Andrews Community mortgage payable of $1,127,000 and the Argyle Court mortgage payable of $435,498. At the end of the note’s 40-year term, accrued interest will be due and payable only to the extent the fair market value of the property (as defined) exceeds the principal balance of the note plus all superior indebtedness secured against the property. Due to this contingency, interest on the note has not been accrued in the accompanying consolidated financial statements because the future fair market value of the property at loan maturity is not expected to be sufficient. At December 31, 2020, the Organization is contingently liable for the cumulative amount of unpaid interest that could be due on the note, which approximated $3,572,000, if the fair market value of the property is sufficient at loan maturity.

The deferral provisions related to the accrual of interest expense discussed above, and as stipulated in the respective loan agreements remain in effect only as long as the properties are operated and maintained as low-income housing and the Organization complies with various other provisions of the agreements. In the event that the properties are not maintained as low-income housing, or if there are other material violations of the loan agreements, the mortgage notes become due and payable. Although this is a possibility, management deems the contingency remote and plans to meet the conditions as set forth in the provisions of the loan agreements.

8. COMMITMENTS AND CONTINGENCIES
Guaranties HCHC, as the General Partner in various Affordable Housing Affiliates has entered into certain guarantees with the Investor Limited Partner regarding construction completion, initial operating, and tax credit guaranties, as defined in the Partnership Agreements, including the following:
 Development Guaranty In general, HCHC is obligated to pay any development cost deficits or, at the option of the investor limited partner, to purchase the interest of the investor limited partner if the project is not completed or if permanent financing has not been obtained by specific dates.

Under these guarantees, HCHC provides assurance on project completion and repayment guarantees to lenders for the respective loans. These obligations typically terminate upon funding of permanent project financing.

11.A.k
Packet Pg. 1416 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

HOLLYWOOD COMMUNITY HOUSING CORPORATION AND AFFILIATES
(A NONPROFIT CALIFORNIA CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2020

Page 25 ends

 Credit Recapture Guaranty In the event of a recapture of tax credits previously received by an investor limited partner, HCHC shall be obligated to reimburse the investor limited partner for any recaptured credits plus any related penalties, interest or additional taxes due. HCHC is not obligated to reimburse if the recapture is due to a change in law or actions by the limited partners.
 Operating Deficit Guarantees HCHC has entered into various agreements with certain limited partnerships or their affiliated general partners whereby HCHC guarantees to loan funds to the partnerships in the event that the partnerships incur operating deficits, as defined in the respective partnership agreements, or fail to meet their current financial obligations. These agreements expire at various dates through the terms of the underlying partnership or debt agreements. Loans made pursuant to these guarantees are generally interest-free and unsecured. Generally, the maximum potential amount of future payments under these guarantees is equal to the amount guaranteed to the partnerships under the tax indemnification agreements discussed below.

HCHC entered into various agreements with certain limited partnerships or their affiliated general partners whereby HCHC offers tax indemnification in the event of low-income housing tax credit recapture. HCHC’s potential liability under these agreements is dependent upon IRS audits and final letters of determination of the limited partnership’s qualified basis in tax credit properties.

Similarly, HCHC has entered into agreements with state and local governments who have provided loans to certain limited partnerships for the development of affordable housing whereby HCHC has guaranteed any recapture of the loans resulting from non-compliance with affordable housing requirements. Management is not aware of any known liability for tax credit or loan recapture.

HCHC’s participation in the limited partnerships described above results in contingent liabilities.

Pursuant to the terms of the partnership agreements, the limited partners are responsible only for initial capital contributions. As a result, HCHC may be required to arrange for additional funds related to any rehabilitation or operating needs of the partnerships. HCHC may also be subject to other liabilities of the partnerships if the partnership’s assets should become insufficient to meet their obligations. In the opinion of management, the future revenues and the value of underlying assets of these partnerships will be sufficient to meet their obligations.

In connection with the Affordable Housing Affiliates who have received low-income housing tax credits, the Affordable Housing Affiliates’ awarded housing tax credits are contingent on their ability to maintain compliance with applicable Internal Revenue Service tax credit regulations on an ongoing basis. Failure to maintain compliance with occupant eligibility, and/or unit gross rent, or to correct noncompliance within a specified time period, could result in recapture of previously taken tax credits. HCHC, as the General Partner, is responsible to ensure that the Partnership satisfies such requirements as part of its guarantees, as defined in the Partnership Agreement.

The properties owned and operated by the Organization are typically developed using monies provided by restrictive, low-interest rate, loans. The terms of these loans restrict the use of the property and generally require that it be rented to low-income qualified tenants for the period of the related loan term. Failure to comply with the terms of the loans would result in a requirement to repay a portion or the entire amount of proceeds received.

HOLLYWOOD COMMUNITY HOUSING CORPORATION AND AFFILIATES
(A NONPROFIT CALIFORNIA CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2020

Page 26 ends

Joint Development and Operations Agreement During 2018, HCHC entered into a Joint Development and Operations Agreement with Venice Community Housing Corporation (VCHC) for the development and construction of 140 units of affordable housing and commercial/retail spaces in Venice, California. In connection with funding predevelopment costs for the project, HCHC and VCHC, as co-borrowers, entered into a joint loan agreement and promissory note payable to Supportive Housing Solutions Fund LLC, in the maximum amount of $3,273,000, bearing interest at 6% per annum which is paid monthly. During 2019, the loan maturity date was extended to December 30, 2022. The loan balance was $1,648,744 as of December 31, 2020, and the loan and related predevelopment costs are reflected on the books of VCHC. As co-borrower, HCHC is contingently liable for 50% of the loan balance if an Event of Default, as defined, occurs or upon the maturity of the note and there is no construction financing available to pay-off the note.

During 2020, HCHC entered into a Joint Development Agreement with GTM Holdings LLC for the development and construction of 91 units of affordable housing and commercial/retail spaces in Los Angeles, California.

Operating Leases HCHC leases office equipment under various operating lease agreements.

Gross monthly minimum lease payments are $647 through July 2024. Equipment rental expense for the year ended December 31, 2020 amounted to $10,470.

Litigation The Organization is subject to lawsuits and claims which arise out of the normal course of its activities. Management believes the disposition of any and all such actions of which it is aware will not have a material effect on the financial position or changes in net assets of the Organization.

Effects of the COVID-19 Outbreak During 2020, there was a global outbreak of a new strain of coronavirus, COVID-19. The global and domestic response to the COVID-19 outbreak continues to rapidly evolve. To date, certain responses to the COVID-19 outbreak have included mandates from federal, state and/or local authorities to mitigate the spread of the virus, which have adversely impacted global commercial activity and have contributed to significant volatility in financial markets.

The Organization’s management continues to gather information in response to the COVID-19 pandemic and the possible impact to the Organization’s cash flow. Management is adjusting its operations accordingly and will continue to assess and monitor the situation as it evolves. Although the Organization has received financial support, the ultimate impact to the financial condition, results of operations and cash flows of the Organization is unknown.

9. RETIREMENT PLAN
Employees may participate in an Internal Revenue Code section 403(b) retirement savings plan, established by HCHC. The plan is funded solely by employee contributions to the plan, pursuant to a salary reduction agreement. All employee contributions are immediately vested.

11.A.k
Packet Pg. 1417 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

HOLLYWOOD COMMUNITY HOUSING CORPORATION AND AFFILIATES
(A NONPROFIT CALIFORNIA CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2020

Page 27 ends

10. NET ASSETS
The following is a summary of consolidated net assets of the Organization as of December 31, 2020:
0 Without donor restrictions
Non- With
Controlling controlling Donor
Interest Interest Restrictions Total
Net assets, January 1, 2020 $ 4,513,184 $ 61,773,685 $ 64,568 $ 66,351,437 Change in accounting policy (Note 11) (2,249,396) - - (2,249,396) Net assets, beginning of year, as
adjusted 2,263,788 61,773,685 64,568 64,102,041
Release from donor restrictions 309,668 - (309,668) -
Contributions - 306,451 - 306,451
Change in net assets (deficit) (2,148,992) (5,256,535) 330,100 (7,075,427) Net assets, December 31, 2020 $ 424,464 $ 56,823,601 $ 85,000 $ 57,333,065 2020
Net assets without donor restrictions - controlling
Board designated $ 800,000
Undesignated (375,536)
Total net assets without donor restrictions - controlling $ 424,464 Undesignated net assets are available for any purpose within the scope of the Organization’s activities. Board designated net assets are appropriated by the Board of Directors for a specific activity and could be changed only by action of the Board.

Donor restricted net assets are available for the following purposes:

Net Assets with Donor Restrictions
Available New Available
December 31, Revenues, December 31,
2019 Net Releases 2020
Subject to expenditure for special purposes:

Tenant supportive services $ 39,568 $ 10,000 $ (39,568) $ 10,000 Affordable housing predevelopment
expense - 115,000 (90,000) 25,000
39,568 125,000 (129,568) 35,000
Subject to passage of time:

General operating support 25,000 205,100 (180,100) 50,000 25,000 205,100 (180,100) 50,000
Total net assets with donor
restrictions $ 64,568 $ 330,100 $ (309,668) $ 85,000

HOLLYWOOD COMMUNITY HOUSING CORPORATION AND AFFILIATES
(A NONPROFIT CALIFORNIA CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2020

Page 28 ends

11. CHANGE IN ACCOUNTING POLICY

The Organization elected to change its accounting policy with respect to the elimination of the developer fee gross profit earned from Affordable Housing Affiliates. This new policy was adopted to enhance the presentation of the consolidated activities of HCHC and the Affordable Housing Affiliates under development. Effective January 1, 2020, the developer fee gross profit earned from Affordable Housing Affiliates included in the consolidated financial statements are eliminated as discussed in Note 2. Previously, the Organization only eliminated the deferred portion of developer fees payable from future Project operations. As a result of this accounting change, net assets as of December 31, 2019 was decreased by $2,249,396 and property was decreased by the same amount.

12. SUBSEQUENT EVENTS
Management has evaluated subsequent events that have occurred through the date of the independent auditor’s report, which is the date that the consolidated financial statements were available to be issued and determined that there were no subsequent events or transactions that required recognition or disclosure in the consolidated financial statements, except as disclosed below and in Note 6 and 7.  In January 2021, the Limited Partner and the Investor Limited Partner withdrew from Palomar Apartments, L.P. in accordance with the terms of the partnership agreement.  In March 2021, Palm Vista IIG, a single member LLC, was formed for the purpose of provide funding to Palm Vista L.P. from an Infill Infrastructure Gran of $4,186,600 from HCD which was awarded in June 23, 2020.
 During 2021, HCHC transitioned property management services for three wholly owned properties from an unrelated party to in-house property management services.

11.A.k
Packet Pg. 1418 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

Page 29 ends

SUPPLEMENTARY INFORMATION

11.A.k
Packet Pg. 1419 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

SCHEDULE I

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A NONPROFIT CALIFORNIA CORPORATION)

CONSOLIDATING STATEMENT OF FINANCIAL POSITION
AS OF DECEMBER 31, 2020
HCHC Consolidated
excluding Total
Rental Rental HCHC HCHC Wholly HUD 811 Before Elimination Operations (a) Operations Total Laundry Controlled Owned Entities Eliminations Adjustments Total Assets
Current assets
Cash and cash equivalents $ 2,821,729 $ 141,866 $ 2,963,595 $ 816,585 - $ $ 670,264 $ 24,730 $ 4,475,174 $ 4,475,174 - $ Grants and contracts receivable 160,860 160,860 - - - - 160,860 - 160,860 - Tenants and accounts receivable 1,571 1,405 2,976 123,993 - 133,148 25,065 285,182 285,182 - Deposits 10,000 - 10,000 124,620 - 8,620 143,240 - 143,240 - Prepaid expenses and other current assets 21,011 4,214 25,225 - 124,474 45,339 1,100 196,138 - 196,138 Note and interest receivable - affiliate 873,153 - 873,153 - - - - 873,153 - 873,153 Restricted cash - 13,008 13,008 - 394,401 222,048 10,999 640,456 - 640,456 Total current assets 3,888,324 160,493 4,048,817 1,584,073 - 1,079,419 61,894 6,774,203 6,774,203 - Restricted cash 482,860 255,389 738,249 4,227,658 - 2,677,839 115,770 7,759,516 7,759,516 - Property, at cost
Land 7,100,000 549,053 7,649,053 28,851,841 - 4,887,654 503,600 41,892,148 41,892,148 - Buildings and improvements 1,018,649 3,279,372 4,298,021 186,755,743 - 53,074,609 5,939,842 250,068,215 (7,099,935) 242,968,280 Furniture and equipment 356,097 101,321 457,418 2,174,712 - 1,122,832 46,319 3,801,281 3,801,281 - Construction in progress and development costs 3,071,750 3,071,750 - 75,079,147 - - 78,150,897 - (3,064,757) 75,086,140 Total property, at cost 11,546,496 3,929,746 15,476,242 292,861,443 - 59,085,095 6,489,761 373,912,541 (10,164,692) 363,747,849 Less: accumulated depreciation (622,441) (1,311,889) (1,934,330) (24,408,343) - (27,783,307) (2,299,897) (56,425,877) 560,283 (55,865,594) Property, net 10,924,055 2,617,857 13,541,912 268,453,100 - 31,301,788 4,189,864 317,486,664 (9,604,409) 307,882,255 Developer fee receivable 7,093,521 7,093,521 - - - - 7,093,521 - (7,093,521) - Accrued interest receivable 131,937 131,937 - - - - 131,937 - (131,937) - Loans receivable, net 12,533,767 12,533,767 - - - - 12,533,767 - (12,533,767) - Investments in and advances to limited partnerships 2,171,208 2,171,208 - - 859,569 - 3,030,777 - (3,018,237) 12,540 Deferred costs, net - - - 504,839 - 13,979 - 518,818 518,818 - Total assets $ 37,225,672 $ 3,033,739 $ 40,259,411 $ 274,769,670 - $ $ 35,918,615 $ 4,381,507 $ 355,329,203 $ (32,381,871) $ 322,947,332 (a) HCHC includes the accounts of all single member LLCs.

See independent auditor's report.

Limited Partnerships

Page 30 ends

11.A.k
Packet Pg. 1420 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

SCHEDULE I

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A NONPROFIT CALIFORNIA CORPORATION)

CONSOLIDATING STATEMENT OF FINANCIAL POSITION
AS OF DECEMBER 31, 2020
HCHC Consolidated
excluding Total
Rental Rental HCHC HCHC Wholly HUD 811 Before Elimination Operations (a) Operations Total Laundry Controlled Owned Entities Eliminations Adjustments Total Limited Partnerships
Liabilities and Net Assets
Current liabilities
Accounts payable and accrued expenses $ 216,770 $ 11,408 $ 228,178 $ 189,178 - $ $ 211,929 $ 36,241 $ 665,526 $ 665,526 - $ Construction and development costs payable 213,008 213,008 - 17,212,293 - - 17,425,301 - 17,425,301 - Prepaid rent - 809 809 - 53,135 36,894 6,683 97,521 - 97,521 Due to affiliates 25,807 - 25,807 1,151,109 - 687,297 1,066 1,865,279 (1,838,005) 27,274 Accrued interest payable, current portion 42,718 25,283 68,001 - 75,274 5,624 148,899 - 148,899 Tenant security deposits 30,250 12,219 42,469 375,345 - 247,826 10,224 675,864 675,864 - Notes payable, current portion 5,040,383 95,545 5,135,928 15,772,160 - 180,423 21,088,511 - 21,088,511 - Total current liabilities 5,543,129 171,071 5,714,200 34,828,494 - 1,369,993 54,214 41,966,901 (1,838,005) 40,128,896 Long-term liabilities
Notes payable, net of current portion and
unamortized debt issuance costs 10,828,590 2,721,505 13,550,095 160,691,520 - 28,383,494 6,226,590 208,851,699 (12,525,602) 196,326,097 Accrued interest payable, net of current portion 76,035 - 76,035 16,405,125 - 12,425,874 1,319,765 30,226,799 (1,067,525) 29,159,274 Other liabilities - - - - - - - - - -
Developer fee payable - - - 7,105,880 - 51,385 - 7,157,265 (7,157,265) - Total long-term liabilities 10,828,590 2,797,540 13,626,130 184,202,525 - 40,809,368 7,597,740 246,235,763 (20,750,392) 225,485,371 Total liabilities 16,371,719 2,968,611 19,340,330 219,031,019 - 42,179,361 7,651,954 288,202,664 (22,588,397) 265,614,267 Net assets (deficit)
Without donor restrictions
Controlling interest 20,768,953 65,128 20,834,081 (1,084,950) - (6,260,746) (3,270,447) 10,217,938 (9,793,474) 424,464 Non-controlling interest - - - 56,823,601 - - 56,823,601 - 56,823,601 - Total net assets without donor restrictions 20,768,953 65,128 20,834,081 55,738,651 - (6,260,746) (3,270,447) 67,041,539 (9,793,474) 57,248,065 With donor restrictions 85,000 - 85,000 - - - - 85,000 - 85,000 Total net assets (deficit) 20,853,953 65,128 20,919,081 55,738,651 - (6,260,746) (3,270,447) 67,126,539 (9,793,474) 57,333,065 Total liabilities and net assets (deficit) $ 37,225,672 $ 3,033,739 $ 40,259,411 $ 274,769,670 - $ $ 35,918,615 $ 4,381,507 $ 355,329,203 $ (32,381,871) $ 322,947,332 (a) HCHC includes the accounts of all single member LLCs.

See independent auditor's report.

Page 31 ends

11.A.k
Packet Pg. 1421 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

SCHEDULE II

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A NONPROFIT CALIFORNIA CORPORATION)

CONSOLIDATING STATEMENT OF ACTIVITIES AND CHANGES IN NET ASSETS (DEFICIT) FOR THE YEAR ENDED DECEMBER 31, 2020
HCHC Consolidated
excluding Total
Rental Rental HCHC HCHC Wholly HUD 811 Before Elimination Operations (a) Operations Total Laundry Controlled Owned Entities Eliminations Adjustments Total Public support and revenues
Private contributions (corporate, foundation
and individuals) $ 483,898 $ 483,898 - $ $ - $ - $ - $ 483,898 - $ $ - 483,898 $ Government contracts and grants 305,923 - 305,923 - - - 305,923 - - 305,923 Special events revenue 207,622 - 207,622 - - - 207,622 - - 207,622 Less: direct benefits to donors (15,820) - (15,820) - - - (15,820) - - (15,820) Management fees 359,279 - 359,279 - 14,953 - 374,232 - (341,198) 33,034 Developer fees 4,001,862 - 4,001,862 - - - 4,001,862 - (4,001,862) - Rental revenue 144,000 276,378 420,378 - 5,048,506 3,728,706 398,338 9,595,928 - 9,595,928 Other revenue 152,942 3,644 156,586 - 303,124 52,737 2,494 514,941 (147,504) 367,437 Interest income 35,322 122 35,444 - 4,697 1,957 42,098 - (27,783) 14,315 Investment income 92,544 - 92,544 - - - 92,544 - (92,544) - Contributed goods and services 55,913 - 55,913 - - - 55,913 - - 55,913 Cancellation of indebtness 128,532 - 128,532 - - 150,000 - 278,532 - 278,532 Total revenue 5,823,485 408,676 6,232,161 - 5,356,327 3,798,353 550,832 15,937,673 (4,610,891) 11,326,782 Expenses
Program services 2,037,436 466,356 2,503,792 10,793,657 4,480 5,449,467 578,169 19,329,565 (1,542,539) 17,787,026 General and administrative 321,541 - 321,541 - - - 321,541 - - 321,541 Fundraising 293,642 - 293,642 - - - 293,642 - - 293,642 Total expenses 2,652,619 466,356 3,118,975 10,793,657 4,480 5,449,467 578,169 19,944,748 (1,542,539) 18,402,209 Change in net assets (deficit) 3,170,866 (57,680) 3,113,186 (5,437,330) (4,480) (1,651,114) (27,337) (4,007,075) (3,068,352) (7,075,427) Net assets, beginning of year, as originally reported 17,683,087 122,808 17,805,895 4,480 60,869,530 (4,538,754) (3,243,110) 70,898,041 (4,546,604) 66,351,437 Change in accounting policy (Note 11) - - - - - - (2,249,396) - (2,249,396) Net assets, beginning of year, as adjusted 17,683,087 122,808 17,805,895 60,869,530 4,480 (4,538,754) (3,243,110) 70,898,041 (6,796,000) 64,102,041 Transfer of net assets - - - - (23,077) (23,077) - 23,077 - Contributions - - - 306,451 - - 306,451 - 306,451
Distributions - - - - (47,801) (47,801) - 47,801 -
Net assets, end of year $ 20,853,953 $ 65,128 $ 20,919,081 $ - $ 55,738,651 $ (6,260,746) $ (3,270,447) $ 67,126,539 $ (9,793,474) $ 57,333,065 (a) HCHC includes the accounts of all single member LLCs.

See independent auditor's report.

Limited Partnerships

Page 32 ends

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Packet Pg. 1422 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

SCHEDULE III

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A NONPROFIT CALIFORNIA CORPORATION)

CONSOLIDATING STATEMENT OF EXPENSES
FOR THE YEAR ENDED DECEMBER 31, 2020
HCHC Consolidated
excluding Total
Rental Rental HCHC HCHC Wholly HUD 811 Before Elimination Operations (a) Operations Total Laundry Controlled Owned Entities Eliminations Adjustments Total Salaries, benefits, and taxes $ 2,016,067 $ 2,080,560 64,493 $ $ 946,017 - $ $ 854,618 $ 108,467 $ 3,989,662 $ (686,179) $ 3,303,483 Utilities 34,443 35,929 70,372 755,121 - 564,319 35,154 1,424,966 1,424,966 - Repairs and maintenance 11,769 53,638 65,407 734,589 - 656,442 111,058 1,567,496 1,567,496 - Property taxes and insurance 33,534 8,236 41,770 173,070 - 121,281 12,502 348,623 - 348,623 Professional fees 202,208 6,731 208,939 (167) 203,927 134,978 24,000 571,677 (134,712) 436,965 Management fees 24,958 - 24,958 409,357 - 294,323 47,482 776,120 - 776,120 Advertising 5,647 - 5,647 148,680 - - 154,327 - - 154,327 Other 69,742 11,569 81,311 4,647 241,204 51,902 4,510 383,574 (86,966) 296,608 Office expenses 50,115 9,363 59,478 69,508 - 59,747 21,854 210,587 - 210,587 Events 135,671 - 135,671 - - - 135,671 - - 135,671
Program furniture and supplies 52,263 - 52,263 - - 5,228 57,491 - - 57,491 Asset management fees - 20,345 20,345 158,612 - 181,363 360,320 - (341,198) 19,122 Bad debt 2,559 - 2,559 19,141 - 194 21,894 - - 21,894
Total before depreciation, amortization,
interest and losses 2,614,018 235,262 2,849,280 3,859,226 4,480 2,924,395 365,027 10,002,408 (1,249,055) 8,753,353 Depreciation and amortization 28,229 88,410 116,639 4,340,130 - 1,358,656 141,338 5,956,763 (120,378) 5,836,385 Interest expense and finance fees 10,372 142,684 153,056 2,594,301 - 1,166,416 71,804 3,985,577 (173,106) 3,812,471 Total expenses $ 2,652,619 $ 466,356 $ 3,118,975 $ 4,480 $ 10,793,657 $ 5,449,467 $ 578,169 $ 19,944,748 $ (1,542,539) $ 18,402,209 (a) HCHC includes the accounts of all single member LLCs.

See independent auditor's report.

Limited Partnerships

Page 33 ends

11.A.k
Packet Pg. 1423 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

CONSOLIDATED FINANCIAL STATEMENTS AND

INDEPENDENT AUDITOR'S REPORT
YEAR ENDED DECEMBER 31, 2021

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

TABLE OF CONTENTS
Page
Independent auditor's report 1-3
Consolidated financial statements
Consolidated statement of financial position 4-5
Consolidated statement of activities 6
Consolidated statement of changes in net assets 7
Consolidated statement of cash flows 8
Notes to consolidated financial statements 9-26
Supplementary information
Consolidating financial statements 27-29

11.A.k
Packet Pg. 1424 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

INDEPENDENT AUDITOR'S REPORT
To the Board of Directors of
Hollywood Community Housing Corporation
(A California Not-For-Profit Corporation)
Opinion
We have audited the accompanying financial statements of Hollywood Community Housing Corporation, which comprise the consolidated statement of financial position as of December 31, 2021, and the related consolidated statement of activities, changes in net assets, and cash flows for the year then ended, and the related notes to the consolidated financial statements.

In our opinion, based on our audit and the reports of the component auditors, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Hollywood Community Housing Corporation as of December 31, 2021, and the results of its operations and its cash flows for the year then ended in accordance with accounting principles generally accepted in the United States of America.

We did not audit the financial statements of 20 controlled and wholly owned entities, of which the activity on these controlled entities represents approximately $303.4 million of the total assets of Hollywood Community Housing Corporation's controlled and wholly owned entities at December 31, 2021, and approximately $10.2 million of the total revenue of Hollywood Community Housing Corporation's controlled and wholly owned entities for the year ended December 31, 2021, all respectively. Those statements were audited by component auditors, whose reports have been furnished to us, and our opinion, insofar as it relates to the amounts included for those entities, is based solely on the reports of the component auditors.

Basis for Opinion
We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are required to be independent of Hollywood Community Housing Corporation and to meet our other ethical responsibilities in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Responsibilities of Management for the Consolidated Financial Statements Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.
2 Hollywood Community Housing Corporation

Page 2 ends

Responsibilities of Management for the Consolidated Financial Statements (continued) In preparing the consolidated financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about Hollywood Community Housing Corporation's ability to continue as a going concern within one year after the date that the consolidated financial statements are available to be issued.

Auditor's Responsibilities for the Audit of the Consolidated Financial Statements Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the consolidated financial statements.

In performing an audit in accordance with generally accepted auditing standards, we:
 Exercise professional judgment and maintain professional skepticism throughout the audit.  Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements.
 Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of Hollywood Community Housing Corporation's internal control.

Accordingly, no such opinion is expressed.
 Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the consolidated financial statements.
 Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about Hollywood Community Housing Corporation's ability to continue as a going concern for a reasonable period of time.

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Packet Pg. 1425 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) 3 Hollywood Community Housing Corporation

Page 3 ends

Report on Supplementary Information
Our audit was conducted for the purpose of forming an opinion on the consolidated financial statements as a whole. The consolidating financial statements are presented for purposes of additional analysis and are not a required part of the consolidated financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the consolidated financial statements. The information has been subjected to the auditing procedures applied in the audit of the consolidated financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the consolidated financial statements or to the consolidated financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the consolidated financial statements as a whole.

July 14, 2022 Dauby O'Connor & Zaleski, LLC
Carmel, Indiana Certified Public Accountants
Current assets
Cash and cash equivalents
Cash $ 8,004,116
Restricted reserves 11,981,006
Total cash and cash equivalents 19,985,122
Resident receivables 562,834
Total current assets 20,547,956
Property and equipment
Land 36,341,381
Buildings and improvements 319,751,206
Furniture and equipment 5,343,139
Construction in progress 9,669,119
371,104,845
Less: Accumulated depreciation (64,604,999)
Total property and equipment 306,499,846
Other assets
Grants and contracts receivable 134,527
Notes and other related party receivables 106,760
Investments in partnerships 185,356
Unamortized costs, net 488,791
Other assets 278,915
Total other assets 1,194,349
$ 328,242,151

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

CONSOLIDATED STATEMENT OF FINANCIAL POSITION
DECEMBER 31, 2021
ASSETS
See notes to financial statements 4

11.A.k
Packet Pg. 1426 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) Current liabilities
Accounts payable and accrued expenses $ 4,436,946
Accounts payable - construction 3,134,726
Prepaid revenue 117,763
Accrued interest - current 9,604
Mortgages and notes payable - current maturities 42,324,418 Total current liabilities 50,023,457
Deposit liabilities
Resident security deposits 867,735
Long term liabilities
Mortgages and notes payable, net of current maturities (amortizing) 17,612,828 Mortgages and notes payable (non amortizing) 150,216,126 Less: Unamortized debt issuance costs (1,213,369)
Due to affiliates - long-term 22,201
Accrued interest - long-term 33,235,502
Total long term liabilities 199,873,288
Total liabilities 250,764,480
Net assets - without donor restrictions
Controlling interest (1,834,656)
Non-controlling interest 79,167,327
Total net assets - without donor restrictions 77,332,671 Net Assets - with donor restrictions 145,000
Total net assets 77,477,671
Total liabilities and net assets $ 328,242,151

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

CONSOLIDATED STATEMENT OF FINANCIAL POSITION (CONTINUED) DECEMBER 31, 2021

LIABILITIES AND NET ASSETS
See notes to financial statements 5

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)
Revenues
Net rental income $ 11,809,187
Contribution income 7,533
Government contracts and grants 1,158,265
Special events income 21,553
Development income 245,000
Management and partnership fee income 62,800
Interest income, net 49,310
Other income 399,855
Total revenue 13,753,503
Operating expenses
Administration 1,788,320
Management fees 634,053
Salaries and benefits 4,209,989
Utilities 1,388,017
Repairs and maintenance 2,291,093
Taxes and insurance 656,568
Total operating expenses 10,968,040
2,785,463
Debt maintenance
Interest expense 5,437,985
Interest expense - other 45,487
Total debt maintenance 5,483,472
Income (loss) from operations before other expenses (2,698,009) Other expenses
Depreciation and amortization 8,285,196
Other entity expenses 110,335
Total other expenses 8,395,531
Change in net assets $ (11,093,540)

CONSOLIDATED STATEMENT OF ACTIVITIES
YEAR ENDED DECEMBER 31, 2021
expenses
Income (loss) from operations before debt maintenance and other See notes to financial statements 6

11.A.k
Packet Pg. 1427 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

CONTROLLING INTEREST
Balance, January 1, 2021 $ 424,646
Contributions 100,000
Distributions (31,286)
Other changes in controlling interest 103,074
Change in net assets (2,431,090)
Balance, December 31, 2021 $ (1,834,656)

NON-CONTROLLING INTEREST
Balance, January 1, 2021 $ 56,823,601
Contributions 31,349,223
Distributions -
Syndication costs (110,000)
Other changes in non-controlling interest (173,047)
Change in net assets (8,722,450)
Balance, December 31, 2021 $ 79,167,327
Balance, January 1, 2021 $ 85,000
Change in net assets - with donor restrictions 60,000
Balance, December 31, 2021 $ 145,000

CONSOLIDATED STATEMENT OF CHANGES IN NET ASSETS
DECEMBER 31, 2021

NET ASSETS - WITHOUT DONOR RESTRICTIONS

NET ASSETS - WITH DONOR RESTRICTIONS
See notes to financial statements 7

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)
Cash flows from operating activities
Change in net assets $ (11,093,540)
Adjustments to reconcile change in net assets to net
cash provided by (used in) operating activities:

Depreciation and amortization 8,285,196
Changes in:

Resident receivables (277,652)
Grants and contracts receivable 26,333
Notes and other related party receivables 766,393
Prepaid expense 60,463
Accounts payable and accrued expenses 3,771,420
Due to related party (5,073)
Accrued interest 3,936,933
Prepaid revenue 20,242
Security deposit liability 191,871
Net cash provided by (used in) operating activities 5,682,586 Cash flows from investing activities
Payments for property and equipment (21,595,347)
Investments in partnerships (172,816)
Net cash provided by (used in) investing activities (21,768,163) Cash flows from financing activities
Contributions 31,449,223
Proceeds from mortgages and notes payable 9,845,103
Syndication costs (110,000)
Distributions (31,286)
Principal payments on mortgages and notes payable (17,910,093) Payments for tax credit fees (47,394)
Net cash provided by (used in) financing activities 23,195,553 Net change in cash and cash equivalents 7,109,976
Cash and equivalents, beginning 12,875,146
Cash and equivalents, ending $ 19,985,122
Supplemental disclosure of other information
Cash paid for interest $ 2,539,993

CONSOLIDATED STATEMENT OF CASH FLOWS
YEAR ENDED DECEMBER 31, 2021
See notes to financial statements 8

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Packet Pg. 1428 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) 9 HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2021
NOTE 1-ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

ORGANIZATION
Hollywood Community Housing Corporation (HCHC) was formed to provide affordable housing through acquisition, construction, rehabilitation, and operation of residential properties in a manner that enhances existing neighborhoods.

HCHC's wholly owned affiliates include Hollywood Housing Holdings, LLC, HCHC Recap I, LLC, Step Up On Vine, LLC, HCHC General Partner, LLC, Stanford Avenue GP, LLC, HCHC Florence Mills GP, LLC, HCHC Gramercy Place GP, LLC, HCHC Palm Vista MGP, LLC, HCHC Palm Vista IIG, LLC, HCHC Walnut Park GP, LLC, HCHC Luna Vista GP, LLC, and Venice Dell GP, LLC. HCHC or these affiliates have ownership in the following entities (the Properties, and together with HCHC, the Corporation):

Entity DBA Units Ownership %
Controlled Entities
Alexandria House Apartments, LP Alexandria House Apartments 16 0.0051 Palo Verde Apartments, LP Palo Verde Apartments 49 0.010 Paul Williams Apartments, LP Paul Williams Apartments 41 0.010 Florence Mills Apartments, LP Florence Mills Apartments 74 0.010 Gramercy Place Apartments, LP Gramercy Place Apartments 64 0.010 Stanford Avenue Apartments, LP Stanford Avenue Apartments 85 0.010 HCHC Recap 1, LP Argyle, Carlton Way, Wilcox 68 0.010
Hollywood Bungalow Courts, LP Hollywood Bungalow Courts 42 0.010 Mariposa Place Apartments, LP Mariposa Place Apartments 58 0.010 Coronel Apartments, LP Coronel Apartments 54 0.010
Step Up on Colorado, LP Step Up on Colorado 34 0.005
Step Up on Vine, LP Step Up on Vine 34 0.005
Wholly Owned Entities
Not separately incorporated Argyle Court Apartments 23 100.000 Not separately incorporated Orchard Gables n/a 100.000
Innes Heights, LP Innes Heights Apartments 19 100.000
Barnsdall Court, LP Barnsdall Court Apartments 38 100.000 Selma-Hudson Community, LP Casa Verde Apartments 30 100.000 Dunning Apartments Partnership, LP Dunning Apartments 26 100.000 Kenmore Apartments, LP Kenmore Apartments 21 100.000
Mirada Terrace Apartments, LP Mirada Terrace Apartments 30 100.000 St. Andrew's Community, LP St. Andrew's Bungalow Court 16 100.000 Harold Way Apartments, LP Harold Way Apartments 51 100.000 Palomar Apartments, LP Palomar Apartments 27 100.000
Views at 270, LP Views Apartments 56 100.000
Luna Vista, LP Luna Vista Apartments 73 100.000
Walnut Park, LP Walnut Park Apartments 64 100.000
Allesandro Housing 811-01 Allesandro Housing 18 100.000 Waterloo Heights 811-97 Waterloo Heights Apartments 18 100.000 10 HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEAR ENDED DECEMBER 31, 2021
NOTE 1-ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

ORGANIZATION (CONTINUED)
Entity DBA Units Ownership %
Equity Method Investments
La Brea Franklin, LP La Brea Franklin Apartments 40 20.000 Western Carlton Apartments, LP Western Carlton Apartments I 61 0.100 Western Carlton II, LP Metro Hollywood 60 0.005
Palm Vista, LP Palm Vista Apartments 91 0.0049
During the year ended December 31, 2021, construction on Florence Mills and Gramercy Place was completed, and construction on Palm Vista was in process.

The majority of the Corporation's Wholly Owned Entities are separately incorporated partnerships.

The Corporation also presents Argyle Court Apartments and Orchard Gables as Wholly Owned Entities, however, these Properties are not separately incorporated. In addition, the Corporation presents two nonprofit organizations regulated by the United States Department of Housing and Urban Development (HUD) Section 811 Program, Allesandro Housing and Waterloo Heights, as Wholly Owned Entities as HCHC has both an economic interest and control of the organizations through a majority voting interest in their governing boards.

Cash flow from operating activities generated by the Properties is payable in accordance with each Property's respective organizational documents. The Properties pay distributions in accordance with the terms of the partnership or operating agreements, after priority payments which include payments to the limited partner, the asset manager, the developer fee, repayment of advances to the property, and reimbursable service charges as applicable.

Description of programs
The Corporation improves the quality and affordability of housing in Los Angeles County by developing new apartments and rehabilitating existing properties. The Properties are clustered in different parts of Los Angeles County and serve low-income households. The Corporation's programs are as follows:

Housing Operations - HCHC's housing operations includes the operations of the Properties and its asset management department which develops and implements strategies to ensure the long-term health of its properties for the benefit of its residents. HCHC also manages 147 units as of December 31, 2021 and anticipates self managing additional Properties in future periods. The department monitors the lease-up process of new buildings, supervises property management operations, analyzes financial performance, imposes control over property maintenance, mediates resident grievances, and works with its housing development department on design considerations for new buildings. The asset management team actively seeks out ways to lower operating expenses, primarily through green initiatives and energy savings programs.

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Packet Pg. 1429 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) 11 HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEAR ENDED DECEMBER 31, 2021
NOTE 1-ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Description of programs (continued)
Housing Development - HCHC's core programs include the development of affordable housing and permanent supportive housing. Since its inception, HCHC has developed 32 properties that house over 2,500 people in 1,153 units of safe, attractive and centrally located affordable housing.

Resident Services - HCHC's resident services program provides care coordination, referral and linkage to resources, crisis intervention, a food pantry, ESL classes, GED instruction, group/individual therapy, and life-skills classes. When circumstances like a pandemic are not a factor, HCHC's Food Pantry is open once a week to HCHC residents and the community at large and provides food staples, meat, and vegetables every month. People accessing the food pantry include a number of special-needs residents who live in HCHC communities, low-income households in the neighboring community, and individuals who identify as homeless.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of preparation of the consolidated financial statements The consolidated financial statements are prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America, and are in conformity with the provisions required by the Not-for-Profit Entities Presentation of Financial Statements topic of the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 958-205. This topic established standards for external financial reporting for Not-for-Profit Organizations.

The Not-for-Profit Entities Presentation of Financial Statements topic primarily affects the display of the consolidated financial statements and requires that the amounts for each of two classes of net assets - with or without donor restrictions - be displayed in the Consolidated Statement of Financial Position and the amounts of the change in each of those classes of net assets be displayed in a Consolidated Statement of Changes in Net Assets.

In accordance with FASB ASC 958-810, the consolidated financial statements include the accounts of the Corporation and its wholly owned partnerships and limited liability companies, after elimination of all material intercompany accounts, transactions, and profits. The Corporation does not consolidate the transactions and accounts of the previously mentioned equity method investments.

The financial statements also consolidate the assets, liabilities, and activities of the Corporation and various limited partnerships and limited liability companies for which the Corporation, as the general partner or managing member, has a controlling financial and legal interest. All significant intercompany transactions have been eliminated in the consolidation. 12 HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEAR ENDED DECEMBER 31, 2021
NOTE 1-ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Net assets without donor restrictions - controlling interests Net assets without donor restrictions - controlling interests are not restricted by donor-imposed stipulations and are available for use at the discretion of the board of directors and/or management for general operating purposes. The only limits on net assets are broad limits resulting from the nature of the Corporation and the purposes specified in its articles of incorporation or bylaws and, perhaps, limits resulting from contractual agreements. From time to time the board designates a portion of these net assets for specific purposes which makes them unavailable for use at management's discretion.

Net assets without donor restrictions – noncontrolling interests Net assets without donor restrictions – noncontrolling interests represent the aggregate balance of the third party limited partners' equity interest, generally 99.99%, in the controlled limited partnerships that are included in the consolidated financial statements.

Net assets with donor restrictions
Net assets with donor restrictions are contributions and other inflows of assets whose use by the Corporation is limited by donor-imposed stipulations. Some donor-imposed restrictions are temporary in nature, such as those that will be met by the passage of time or other events specified by the donor. Other donor-imposed restrictions are perpetual in nature, where the donor stipulates that resources will be maintained in perpetuity. Donor-imposed restrictions are released when a restriction expires, that is, when the time has elapsed, when the stipulated purpose for which the resource was restricted has been fulfilled, or both and the net assets are reclassified as net assets without donor restrictions and reported in the consolidated statement of activities as net assets released from restrictions.

New accounting pronouncements
In February 2016, the FASB issued Accounting Standards Update (ASU) 2016-02, Leases, which once implemented will result in lessees recognizing most leased assets and corresponding lease liabilities on the consolidated statement of financial position. The standard is effective for yearends beginning after December 15, 2021 and early adoption is permitted.

In March 2020, FASB issued ASU 2020-04, Reference Rate Reform (Topic 848), which provides optional guidance for a limited period of time to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting. The standard is effective from March 2020 through December 31, 2022 and will allow the Corporation to adopt other reference rates without applying the contract modifications provisions of accounting standards generally accepted in the United States of America. During the year ended December 31, 2021, ASU 2020-04 did not have a material impact on the Corporation. Management expects to apply the provisions of ASU 2020-04 once the LIBOR reference rate related to the debt is discontinued.

11.A.k
Packet Pg. 1430 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) 13 HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEAR ENDED DECEMBER 31, 2021
NOTE 1-ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Cash
For the consolidated statement of cash flows, all unrestricted investments with original maturities of three months or less are cash. At December 31, 2021, cash consists of operating checking and money market accounts. The carrying amount of cash and deposits held in trust-funded accounts approximates fair value due to the type of investments and the maturity dates.

Restricted reserves
The Properties have set up certain operating, replacement, development and other reserve accounts and continues to make annual deposits as required by the various loan and regulatory agreements. In addition, restricted reserves also include tenant security deposits and development reserves restricted by lenders to be used for development purposes.

Resident receivable and bad debt policy
The Properties' resident rent charges for the current month are due on the first of the month.

Residents who are evicted or move-out are charged with damages or cleaning fees, if applicable.

Resident receivables consist of amounts due for rental income or the charges for damages and cleaning fees. The Properties do not accrue interest on the resident receivable balances.

Resident receivables are charged to bad debt expense when they are determined to be uncollectible based upon a periodic review of the accounts by management. Accounting principles generally accepted in the United States of America require that the allowance method be used to recognize bad debts; however, the effect of using the direct write-off method is not material to the consolidated financial statements for the year ended December 31, 2021. Bad debts expensed for the year ended December 31, 2021 totaled $28,336.

Developer fee receivable
Developer fee receivable consists of amounts earned in connection with the development of affordable housing facilities and are based on a percentage of development costs incurred and is eliminated in consolidation. Amounts due from the housing facilities are stated at unpaid balances, less an allowance for doubtful accounts. The Corporation may accrue interest on the developer fee receivable balance. As of December 31, 2021, the allowance for doubtful accounts relating to the developer fee receivable totaled $-0-. Bad debts expensed for the year ended December 31, 2021 totaled $-0-.

Property and equipment
The Properties' depreciation of property and equipment, stated at cost, is computed primarily using the straight-line method over the estimated useful lives of the assets ranging from 3 - 40 years.

Costs that are deemed to increase the useful life of the property or equipment are capitalized.

When assets are sold or otherwise disposed of, the costs and related reserves are removed from the accounts, and any resulting gain or loss is included in operations. 14 HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEAR ENDED DECEMBER 31, 2021
NOTE 1-ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Property and equipment (continued)
The Properties incurred costs related to the construction period, including development service fees, interest, real estate taxes, and insurance, which are capitalized and included in property and equipment.

The Properties are subject to the provisions of the Impairment or Disposal of Long-Lived Assets topic of the FASB ASC 360-10. Impairment or Disposal of Long-Lived Assets has no retroactive impact on the Corporation's consolidated financial statements. The standard requires impairment losses to be recorded on long-lived assets when indicators of impairment are present and the undiscounted cash flows estimated to be generated by those assets (excluding interest) are less than the carrying amount of the assets. In such cases, the carrying value of assets to be held and used are adjusted to their estimated fair value and assets held for sale are adjusted to their estimated fair value less selling expenses. No impairment losses were recognized during the year ended December 31, 2021.

Pre-development costs receivable
Pre-development costs receivable consist of amounts advanced to fund entity formation and predevelopment of affordable housing facilities. Amounts due from the housing facilities are stated at unpaid balances, less an allowance for doubtful accounts. As of December 31, 2021, the allowance for doubtful accounts relating to the pre-development costs receivable totaled $-0-. Bad debts expensed for the year ended December 31, 2021 totaled $-0-.

Notes and other related party receivables
Notes and other related party receivable are carried at amounts contractually due, less an allowance for doubtful accounts. The Corporation accrues interest on the note receivable balances.

Management periodically reviews notes receivable and uses an allowance for doubtful accounts to recognize bad debts. Notes receivable on the Consolidated Statement of Financial Position is shown net of the allowance for doubtful accounts. As of December 31, 2021, the allowance for doubtful accounts relating to the notes and other related party receivables totaled $-0-. Bad debts expensed for the year ended December 31, 2021 totaled $-0-.

11.A.k
Packet Pg. 1431 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) 15 HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEAR ENDED DECEMBER 31, 2021
NOTE 1-ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Investment in partnerships
The Corporation does not consolidate the accounts and activities of certain Properties it considers equity investments. The Corporation has determined that it is unable to exercise significant influence of the limited liability entities under FASB ASC 958-810. The Corporation accounts for its equity investments in accordance with the equity method of accounting, under which the equity investment is carried at cost and is adjusted for the Corporation's share of net income or loss and by cash distributions received. Equity in loss of each equity investment allocated to the Corporation is recognized to the extent of the Corporation's equity investment balance. Previously unrecognized equity in loss is recognized in the year in which equity in income is earned by such equity investment or additional investment is made by the Corporation. Distributions received subsequent to the elimination of an equity investment balance will be recorded as other income. Advances and additional capital contributions will be recorded as additional equity investments if they occur. The Corporation assesses the carrying value of its equity investments whenever there are indications that a permanent impairment may have occurred. No impairment losses were recognized during the year ended December 31, 2021.

Unamortized costs
Certain Properties incurred costs including California Tax Credit Allocation (TCAC) monitoring fees which are being amortized over 10-15 year terms using the straight-line method.

Debt issuance costs
The Corporation or Properties are subject to the provisions of the Interest-Imputation of Interest topic of the FASB ASC 835-30 which requires unamortized debt issuance costs to be presented as a reduction of the outstanding debt and the amortization of the debt issuance costs to be presented as a component of interest expense. Debt issuance costs are amortized on a straight-line basis or effective interest method over the term of the loans.

Contingent interest
Certain Properties do not record continent interest due on certain notes payable as the Corporation anticipates it will be forgiven upon loan maturity.

Contributions
Syndication costs incurred in connection with generating contributions of the non-controlling interests are reported net of syndication costs for financial reporting purposes.

Rental income
The Properties' rental income is recognized as rents become due. Rental payments received in advance are deferred until earned. All leases between the Properties and the residents of the property are operating leases under FASB ASC 840 and are not within the scope of FASB ASU 2014-09.
16 HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEAR ENDED DECEMBER 31, 2021
NOTE 1-ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Management fee income
The Corporation's management fee income is earned based on the terms as outlined in the management agreements between HCHC and various properties. Management fees are typically paid by various properties one month in arrears.

Grant revenue
Grants that the Corporation receives from various government and nongovernmental agencies have long-term compliance requirements. The Corporation intends to fulfill the compliance requirements as part of its mission. The amounts received are recognized as revenue in the period that the compliance requirements are met.

Contributions and donations
Contributions and donations that the Corporation receives, including unconditional promises to give, are recognized in the period received or made, in accordance with FASB ASC 958-605 under the Revenue Recognition of Contributions Receivable topic.

Developer fee revenue
The Corporation earns developer fees primarily for orchestrating the financing and construction of affordable housing, generally in its capacity as general partner or managing member of various real estate partnerships and limited liability companies. Fees are recognized based on completion of various phases of the property representing its performance obligations, as specified in the respective agreements. Certain fees are deferred and payable from the properties' future available operating cash flow. In accordance with FASB ASC 606, an allowance should be established to reserve against balances determined to be uncollectible. However, the receivable balances are eliminated as intercompany transactions, and the difference is considered to not be material to the consolidated financial statements.

Advertising costs
The Properties' advertising costs are expensed as incurred and are included in administrative expenses in the consolidated statement of activities.

Property taxes
The Properties are generally exempt from property taxes on residential property. If property taxes are not exempt, they are expensed in the year of the lien on the property such that twelve months of expense are charged to operations each year.

11.A.k
Packet Pg. 1432 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) 17 HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEAR ENDED DECEMBER 31, 2021
NOTE 1-ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Functional allocation of expenses
The Corporation's program is to provide affordable housing and those costs have been summarized on a functional basis in the table below. Management and general expenses include those expenses that are not directly identifiable with any other specific function but provide for the overall support and direction of the Corporation.

Subtotal
Housing Housing Resident Program Management
Operations Development Services Services and General Fundraising Total Administration $ 1,500,368 $ 109,372 $ 1,709,909 100,169 $ $ 40,987 $ 46,214 $ 1,797,110 Management fees 634,053 - 634,053 - - 634,053 -
Salaries and benefits 2,614,985 604,396 401,498 3,620,879 424,223 156,097 4,201,199 Utilities 1,382,133 1,643 2,645 1,386,421 1,167 1,388,017 429 Repars and
maintenance 2,286,301 1,818 1,208 2,289,327 1,291 2,291,093 475 Taxes and insurance 622,625 12,878 8,555 644,058 9,145 3,365 656,568 Interest expense 5,448,695 11,297 7,505 5,467,497 8,023 2,952 5,478,472 Depreciation
and amortization 8,257,463 12,419 8,250 8,278,132 8,819 3,245 8,290,196 Other entity expense 110,335 - 110,335 - - 110,335 -
$ 753,823 22,856,958 $ $ 24,140,611 529,830 $ 493,655 $ $ 212,777 $ 24,847,043 Program Services
Concentration of credit risk
The Corporation maintains various cash balances at one financial institution. The balances in the accounts are insured by the Federal Deposit Insurance Corporation up to $250,000. From time to time during the period, the cash balances held at the institution exceeded the FDIC Insurance Limit. Management monitors the financial strength ratings of the institution on a periodic basis.

The Corporation's operations are concentrated in the multifamily real estate market. In addition, the Corporation operates in a heavily regulated environment. The operations of the Corporation are subject to the administrative directives, rules and regulations of federal, state, and local regulatory agencies, including, but not limited to, HUD. Such administrative directives, rules and regulations are subject to change by an act of Congress or an administrative change mandated by regulatory bodies. Such changes may occur with little notice or inadequate funding to pay for the related cost, including the additional administrative burden, if any, to comply with a change.

Use of estimates in the preparation of consolidated financial statements The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
18 HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEAR ENDED DECEMBER 31, 2021
NOTE 1-ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Accounting for uncertainty in income taxes
The Corporation is exempt from federal income tax under Section 501(c)(3) of the Internal Revenue Code and state income tax and has been classified as other than a private foundation.

Accordingly, no provision for federal and state taxes on revenue and income has been recognized in the accompanying financial statements.

Even though the Corporation is recognized as tax exempt, it still may be liable for tax on its unrelated business income ("UBI"). The Corporation evaluates uncertain tax positions through its review of the sources of income to identify UBI and certain other matters, including those which may affect its tax-exempt status. The effect of the uncertainty would be recorded if the outcome was considered probable and reasonably estimable. As of December 31, 2021, the Corporation had no uncertain tax positions requiring accrual.

Several of the Properties are treated as pass-through entities for income tax purposes and, as such, are not subject to income taxes. Rather, all items of taxable income, deductions and tax credits are passed through to and are reported by their owners on their respective income tax returns. These entities' federal tax statuses as pass-through entities are based on their legal status as limited partnerships and limited liability companies. Accordingly, these entities are not required to take any tax positions in order to qualify as pass-through entities. These entities are required to file and do file tax returns with the Internal Revenue Service and other taxing authorities.

Accordingly, these Consolidated Financial Statements do not reflect a provision for income taxes and these entities have no other tax positions which they must consider for disclosure. There has been no interest or penalties recognized in the consolidated statement of activities or Consolidated Statement of Financial Position for the year ended December 31, 2021. Generally, the federal and state returns are subject to examination for three years after the later of the original or extended due date or the date filed with the applicable tax authorities.

Fair value
The Corporation is subject to the provisions of the Fair Value Measurement topic of the FASB ASC 820-10 which provides guidance for assets and liabilities which are required to be measured at fair value and requires expanded disclosure for fair value measurement. The standard clarifies the principle that fair value should be based on the assumptions that market participants would use when pricing the asset or liability and establishes the following fair value hierarchy:

Level 1 - Inputs utilize quoted prices in active markets for identical assets or liabilities that the Corporation has the ability to access;
Level 2 - Inputs may include quoted prices for similar assets or liabilities in active markets; and
Level 3 - Unobservable inputs for the asset or liability based on the best available information.

11.A.k
Packet Pg. 1433 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) 19 HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEAR ENDED DECEMBER 31, 2021
NOTE 1-ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Subsequent events
Management performed an evaluation of the Corporation's activity through July 14, 2022, the audit report date, and has concluded that there are no significant subsequent events requiring disclosure through the date these consolidated financial statements were available to be issued except as disclosed in Notes 6 and 10.

NOTE 2-RESTRICTED CASH
The Properties have various cash balances which are segregated and restricted and consist of resident security deposits, replacement reserves, interest reserves, operating reserves, and other reserves which are required to be maintained by various operating, regulatory, or lending agreements. The Properties' designated restricted cash balances held as of December 31, 2021, consisted of the following:

Operating reserves $ 2,906,012
Replacement reserves 3,393,809
Security deposits 894,620
Construction reserves 3,426,514
Other reserves 1,360,051
$ 11,981,006
NOTE 3-LIQUIDITY AND AVAILABILITY OF FINANCIAL ASSETS
The Corporation manages its liquidity by providing sufficient funds for general expenditures in meeting liabilities and other obligations as they become due and maintains cash and cash equivalents that may be drawn upon as needed during the year to manage cash flow and make necessary expenditures. The Corporation's cash and cash equivalents is available within one year of the statement of financial position date to meet cash needs for general expenditures. The Corporation's available financial assets as of December 31, 2021, consisted of the following:

Cash and cash equivalents $ 8,004,116
Receivables 804,121
Less: board designated cash ( 925,000)
Less: net assets with use restrictions ( 145,000)
$ 7,738,237
The Properties' restricted cash may also be drawn upon in the event of financial distress, to make improvements to the properties or an immediate liquidity need resulting from events outside the typical life cycle of converting financial assets to cash or settling financial liabilities. In addition, the Corporation maintains a line of credit for additional liquidity. 20 HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEAR ENDED DECEMBER 31, 2021
NOTE 4-INVESTMENTS IN UNCONSOLIDATED PARTNERSHIPS
The Corporation and its affiliates hold investments in limited partnerships that are not consolidated.

Each partnership is a California limited partnership organized for the purpose of developing and operating low-income housing. As a general partner in the partnerships, the Corporation is contingently liable for the obligations of the partnerships. Pursuant to the terms of the partnership agreements, limited partners are responsible only for initial capital contributions. As a result, the Corporation may be required to arrange for additional funds related to the rehabilitation or operating needs of the partnerships.

The following is a summary of the financial information of Corporation's equity interest in limited partnerships not controlled by the Corporation and accounted for in accordance with the equity method:

Income HCHC
Entity Assets Liabilities (Loss) Equity
La Brea Franklin, LP $ 2,319,951 $ 7,542,250 $( 300,713) -0- Palm Vista, LP 14,949,564 11,921,133 8,574 -0-
Western Carlton Apartments, LP 6,493,268 5,597,999 26,851 -0- Western Carlton II, LP 8,297,241 8,410,842 ( 381,060) -0- NOTE 5-UNAMORTIZED COSTS
Certain Properties incurred costs including California Tax Credit Allocation (TCAC) monitoring fees which are being amortized over 10-15 year terms using the straight-line method.

NOTE 6-MORTGAGES AND NOTES PAYABLE
HCHC Notes
Note payable to Wells Fargo in the original amount of $500,000. The note was amended in 2021, bears simple interest at 2% per annum and matures December 2027. Interest only payments are required quarterly through April 2026. Thereafter, quarterly principal payments of $62,500 are required in addition to interest payments. $ 500,000
Note payable to City of Los Angeles Housing Department (HCIDLA) in the original amount of $3,132,000. The note bears simple interest at 5% per annum and matures November 2061. Annual payments are due from residual receipts, as defined. The note is secured by a deed of trust on the real property and assignment of rents. $ 3,132,000
Note payable to the City of Los Angeles in the original amount of $1,113,875. The note bears simple interest at 5% per annum and matures October 2030. Annual payments are due from residual receipts, as defined.

The note is secured by a deed of trust on the real property. $ 1,113,875

11.A.k
Packet Pg. 1434 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) 21 HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEAR ENDED DECEMBER 31, 2021
NOTE 6-MORTGAGES AND NOTES PAYABLE (CONTINUED)
HCHC Notes (continued)
Note payable to the City of Los Angeles in the original amount of $1,240,715. The note bears simple interest at 5% per annum and matures November 2038. Annual payments are due from 77.54% of residual receipts, as defined. The note is secured by a deed of trust on the real property. $ 1,190,715
Note payable to City National Bank in the original amount of $400,000. The note is non-interest bearing and matures November 15, 2072. Unpaid amounts are due at the maturity date. The note is secured by a deed of trust on the real property. $ 400,000
Note payable to City National Bank in the original amount of $480,000. The note is non-interest bearing and matures December 16, 2071. Unpaid amounts are due at the maturity date. The note is secured by a deed of trust on the real property. $ 480,000
Note payable to Bank of America in the original amount of $530,000. The note is non-interest bearing and matures December 1, 2074. Unpaid amounts are due at the maturity date. The note is secured by a deed of trust on real property. $ 530,000
Note payable to Nonprofit Finance Fund in the original amount of $1,500,000. The note bears simple interest at 5.50% per annum and matures December 22, 2023. $ 1,500,000
Principal payments for the next five year and thereafter are approximately as follows:
2022 $ -
2023 1,500,000
2024 -
2025 -
2026 187,500
Thereafter 7,159,090
$ 8,846,590
Debt issuance costs incurred by the Corporation through December 31, 2021 in connection with obtaining long term financing totaled $15,000. Amortization expense for the year ended December 31, 2021, totaled $5,000 and is included in interest on the statement of activities. Accumulated amortization at December 31, 2021 totaled $5,000.
22 HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEAR ENDED DECEMBER 31, 2021
NOTE 6-MORTGAGES AND NOTES PAYABLE (CONTINUED)
Wholly Owned Entities Notes
Note payable to the City of Los Angeles (Orchard Gables) in the original amount of $1,910,915. The note bears simple interest at 3% per annum and matures January 2031. If the property continues to operate in accordance with the loan agreement, as defined, the lender forgives 5% of any unpaid principal and interest. This determination is made on an annual basis. The note is secured by a deed of trust on the real property. $ 952,308 Note payable to the City of Los Angeles (Argyle Court) in the original amount of $437,479. The note bears simple interest at 5% per annum and is subject to interest forgiveness at the end of the loan term. The note matures March 2037 or at the time of sale or refinance. The Partnership is required to make annual payments from residual receipts, as defined. The note is secured by a deed of trust on real property. $ 435,498
Note payable to the City of Los Angeles (Argyle Court) in the original amount of $1,200,000. The note is non-interest bearing and matures March 2037 or at the time of sale or refinance. The Partnership is required to make annual payments from residual receipts, as defined. The note is secured by a deed of trust on the real property. $ 1,200,000
Note payable to the City of Los Angeles (Argyle Court) in the original amount of $135,000. The note is non-interest bearing and matures at the time of sale or refinance. The Partnership is required to make annual payments from residual receipts, as defined. The note is secured by a deed of trust on the real property. $ 135,000
Six amortizing notes payable to various lenders at differing amounts. The notes bear interest ranging from 4.09% to 8.45% per annum and have maturity dates ranging from August 2024 to May 2035. The notes are secured by deeds of trust on real property. $ 5,838,388 Twenty non-amortizing notes payable to various lenders at differing amounts. The notes bear interest ranging from zero to 5% per annum and have maturity dates ranging from August 2028 to April 2061. Principal and interest payments from residual receipts are required, as defined. The notes are secured by deeds of trust on real property. $ 25,171,812 Two non-amortizing notes payable to HUD under Section 811 of the Housing Act in the original amount of $3,514,300. The notes are non-interest bearing. Notes are subject to loan forgiveness if the properties continue to operate in accordance with the loan agreements. $ 3,514,300

11.A.k
Packet Pg. 1435 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) 23 HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEAR ENDED DECEMBER 31, 2021
NOTE 6-MORTGAGES AND NOTES PAYABLE (CONTINUED)
Wholly Owned Entities Notes (continued)
Five non-amortizing notes payable to various lenders at differing amounts.

The notes bear interest ranging from zero to 5% per annum and have maturity dates ranging from April 2031 to December 2043. Principal and interest payments from residual receipts are required, as defined. The notes are secured by deeds of trust on real property. $ 2,712,291 Two notes payable to Century Housing Corporation (Walnut Park) in the original amount of $3,500,000 and $1,500,000. The notes bear compound interest at the LIBOR rate + 4% with a minimum rate of 6.5% per annum due monthly. The note matures October 18, 2022 after extension at which date an unpaid principal and interest are due. $ 4,414,577 Two notes payable to Low Income Investment Fund (Luna Vista) in the original amount of $750,000 and $3,600,000. The notes bear simple interest at 6.22% and 5.47% per annum due monthly. The notes mature December 2022 after extension at which date an unpaid principal and interest are due. $ 4,290,787
Principal payments for the next five year and thereafter after eliminations are approximately as follows:
2022 $ 9,000,811
2023 307,327
2024 518,232
2025 321,257
2026 301,577
Thereafter 35,807,874
$ 46,257,078
Controlled Limited Partnership Notes
Seven amortizing notes payable to various lenders at differing amounts.

The notes bear interest ranging from 4.47% to 6.20% per annum and have maturity dates ranging from August 2030 to November 2054. The notes are secured by deeds of trust on real property. $ 11,490,369 Two construction notes payable to various lenders at differing amounts. One note has a variable interest rates based on LIBOR and one note has bears interest at 4.60%. Both notes were paid in full with the proceeds of permanent loans and limited partner contributions in 2022. $ 32,950,817 Fifty-one non-amortizing notes payable to various lenders at differing amounts. The notes bear interest ranging from zero to 6% per annum and have maturity dates ranging from November 2032 to April 2076. Principal and interest payments from residual receipts are required, as defined. The notes are secured by deeds of trust on real property. $ 120,588,186 24 HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEAR ENDED DECEMBER 31, 2021
NOTE 6-MORTGAGES AND NOTES PAYABLE (CONTINUED)
Controlled Limited Partnership Notes (continued)
Principal payments for the next five year and thereafter after eliminations are approximately as follows:
2022 $ 33,323,607
2023 415,098
2024 429,536
2025 460,539
2026 477,596
Thereafter 120,749,698
$ 155,856,074
NOTE 7-GRANT INCOME
The Corporation's affiliate HCHC Palm Vista IIG, LLC was awarded a $4,186,800 grant from the Infill Infrastructure Grant Program with Department of Housing and Community Development, a public agency of the State of California. At December 31, 2021, funds received totaled $471,639 which was utilized to fund a loan to Palm Vista, LP (see Note 8).

NOTE 8-RELATED PARTIES
Development income
The Corporation provides services in connection with the development of various Properties. These contracts are at times subject to investor or regulatory agency approval and performance standards. For the year ended December 31, 2021, development fee revenue before eliminations totaled $2,030,413.

Management and partnership fee income
The Corporation provides services in connection with the management of various Properties. These contracts are at times subject to investor or regulatory agency approval and performance standards. For the year ended December 31, 2021, management fee revenue before eliminations totaled $490,418.

Palm Vista note receivable
The Corporation's affiliate HCHC Palm Vista IIG, LLC has executed a loan agreement with Palm Vista, LP in the maximum amount of $4,186,800, bearing no interest, and maturing in 57 years from issuance of certificates of occupancy (projected to be received in 2023). At December 31, 2021, funds loaned and receivable totaled $471,639.

11.A.k
Packet Pg. 1436 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) 25 HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEAR ENDED DECEMBER 31, 2021
NOTE 9-RETIREMENT PLAN
Employees of the Corporation may participate in an Internal Revenue Code section 403(b) retirement savings plan. The plan is funded solely by employee contributions to the plan, pursuant to a salary reduction agreement. All employee contributions are immediately vested.

NOTE 10-COMMITMENTS AND CONTINGENCIES
Guarantees
As general partner or managing member of various entities, the Corporation or affiliates have made certain guarantees. Guarantees typically include the following:
 To ensure the completion of project development and obtain permanent financing  To guaranty the reimbursement of investor limited partner in the event of tax credit recapture
 To lend funds to the partnership to fund any operating deficits during various terms outlined in partnership and debt agreements
As of December 31, 2021, the Corporation had ongoing development completion guaranty agreements on Palm Vista. The estimated development budget is $49 million, of which approximately $14 million was incurred as of December 31, 2021. The Corporation also commenced development on Venice Dell and Washington Boulevard in 2022.

Litigation
The Corporation is subject to lawsuits and claims which arise out of the normal course of its activities. Management believes the disposition of any and all such actions of which it is aware will not have a material effect on the financial position or changes in net assets of the Corporation.

Low-income housing tax credits
Certain Properties received allocations of low-income housing tax credits. The awards of the lowincome housing tax credits are contingent on their ability to maintain compliance with applicable Internal Revenue Service tax credit regulations on an ongoing basis. Failure to maintain compliance with occupant eligibility, and/or unit gross rent, or to correct noncompliance within a specified time period, could result in recapture of previously taken tax credits. The Corporation or its affiliates, as the general partner, is responsible to ensure that the Properties satisfy such requirements as part of its guarantees, as defined in the partnership agreements. 26 HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
YEAR ENDED DECEMBER 31, 2021
NOTE 10-COMMITMENTS AND CONTINGENCIES (CONTINUED)
Contingent interest
Three Properties (Dunning Apartments, St. Andrews Community, and Argyle Court) have loan and regulatory agreements with the City of Los Angeles which provide for possible forgiveness of interest at the end of the note's 40-year term in the event the fair market value of the property (as defined) exceeds the principal balance of the note plus all superior indebtedness secured against the property. Accordingly, interest on the notes have not been accrued in the accompanying consolidated financial statements because the future fair market value of the property at loan maturity is not expected to be sufficient. At December 31, 2021, the Corporation is contingently liable for the cumulative amount of unpaid interest that could be due on the note, which approximated $3,449,000, if the fair market value of the properties is sufficient at loan maturity.

The deferral provisions related to the accrual of interest expense discussed above, and as stipulated in the respective loan agreements remain in effect only as long as the properties are operated and maintained as low-income housing and the Properties comply with various other provisions of the agreements. In the event that the Properties are not maintained as low-income housing, or if there are other material violations of the loan agreements, the mortgage notes become due and payable.

Although this is a possibility, management deems the contingency remote and plans to meet the conditions as set forth in the provisions of the loan agreements.

11.A.k
Packet Pg. 1437 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)
HCHC Wholly Controlled
Corp. Owned Entities Eliminations TOTAL
Current assets
Cash and cash equivalents
Cash $ 5,169,077 $ 1,441,535 $ 1,393,504 $ - $ 8,004,116 Restricted reserves 152,982 3,872,421 7,955,603 - 11,981,006 Total cash and cash
equivalents 5,322,059 5,313,956 9,349,107 - 19,985,122
Resident receivables 146 186,192 376,496 - 562,834
Developer fee receivable, current - - - - -
Prepaid expenses - - - - -
Total current assets 5,322,205 5,500,148 9,725,603 - 20,547,956 Property and equipment
Land - 6,614,228 29,727,153 - 36,341,381
Buildings and improvements 1,300,234 66,950,462 261,201,219 (9,700,709) 319,751,206 Furniture and equipment 386,367 1,330,050 3,626,722 - 5,343,139 Construction in progress 194,447 11,086,993 100,665 (1,712,986) 9,669,119 1,881,048 85,981,733 294,655,759 (11,413,695) 371,104,845 Less: Accumulated depreciation (661,948) (34,724,160) (29,333,174) 114,283 (64,604,999) Total property and equipment 1,219,100 51,257,573 265,322,585 (11,299,412) 306,499,846 Other assets
Developer fee receivable, non current 6,680,235 - - (6,680,235) - Pre-development costs receivable - - - - -
Grants and contracts receivable 134,527 - - - 134,527
Notes and other related party receivables 12,811,016 - - (12,704,256) 106,760 Investments in partnerships 4,487,190 162,000 - (4,463,834) 185,356 Unamortized costs, net - - 488,791 - 488,791
Other assets 34,968 82,326 161,621 - 278,915
Total other assets 24,147,936 244,326 650,412 (23,848,325) 1,194,349 $ 30,689,241 $ 57,002,047 $ 275,698,600 $ (35,147,737) $ 328,242,151

SUPPLEMENTARY INFORMATION
DECEMBER 31, 2021
ASSETS
27 HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)
HCHC Wholly Controlled
Corp. Owned Entities Eliminations TOTAL
Current liabilities
Accounts payable and accrued expenses $ 259,572 $ 259,192 $ 3,932,188 $ (14,006) $ 4,436,946 Accounts payable - construction - - 3,134,726 - 3,134,726 Prepaid revenue 11,501 28,203 78,059 - 117,763
Due to affiliates - current - - - - -
Accrued interest - current 9,604 - - - 9,604
Mortgages and notes payable -
current maturities - 9,000,811 33,323,607 - 42,324,418
Total current liabilities 280,677 9,288,206 40,468,580 (14,006) 50,023,457 Deposit liabilities
Security deposits 6,000 308,174 553,561 - 867,735
Long term liabilities
Mortgages and notes payable, net
of current maturities (amortizing) - 6,495,249 11,117,579 - 17,612,828 Mortgages and notes payable (non
amortizing) 8,846,590 33,168,901 120,635,739 (12,435,104) 150,216,126 Less: Unamortized debt issuance costs (10,000) (125,588) (1,077,781) - (1,213,369) Due to affiliates - long-term - 3,263,838 889,042 (4,130,679) 22,201 Accrued interest - long-term - 15,676,127 18,302,532 (743,157) 33,235,502 Developer fee payable - 51,385 6,692,595 (6,743,980) -
Total long term liabilities 8,836,590 58,529,912 156,559,706 (24,052,920) 199,873,288 Total liabilities 9,123,267 68,126,292 197,581,847 (24,066,926) 250,764,480 Net assets - without donor restrictions
Controlling interest 21,420,974 (11,124,245) (1,050,574) (11,080,811) (1,834,656) Non-controlling interest - - 79,167,327 - 79,167,327
Net Assets - with donor restrictions 145,000 - - - 145,000 Total net assets - without
donor restrictions 21,565,974 (11,124,245) 78,116,753 (11,080,811) 77,477,671 $ 30,689,241 $ 57,002,047 $ 275,698,600 $ (35,147,737) $ 328,242,151

SUPPLEMENTARY INFORMATION (CONTINUED)
DECEMBER 31, 2021

LIABILITIES AND NET ASSETS
28 11.A.k
Packet Pg. 1438 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)
HCHC Wholly Controlled
Corp. Owned Entities Eliminations TOTAL
Revenues
Net rental income $ - $ 4,809,676 $ 6,999,511 $ - $ 11,809,187 Contribution income 7,533 - - - 7,533
Government contracts and grants 686,626 471,639 - - 1,158,265 Special events income 21,553 - - - 21,553
Development income 2,030,413 - - (1,785,413) 245,000
Management and partnership fee income 490,418 - - (427,618) 62,800 Interest income, net 105,200 1,503 1,720 (59,113) 49,310 Investment income 22,822 - - (22,822) -
Other income 235,218 224,075 104,125 (163,563) 399,855
Total revenue 3,599,783 5,506,893 7,105,356 (2,458,529) 13,753,503 Operating expenses
Administration 391,638 549,418 1,010,827 (163,563) 1,788,320 Management fees - 269,343 407,537 (42,827) 634,053
Salaries and benefits 2,167,981 909,951 1,132,057 - 4,209,989 Utilities 7,440 568,093 812,484 - 1,388,017
Repairs and maintenance 6,515 1,173,862 1,110,716 - 2,291,093 Taxes and insurance 46,152 216,800 393,616 - 656,568
Total operating expenses 2,619,726 3,687,467 4,867,237 (206,390) 10,968,040 Income (loss) from operations before
debt maintenance and other expenses 980,057 1,819,426 2,238,119 (2,252,139) 2,785,463 Debt maintenance
Interest expense - 1,220,631 4,393,932 (176,578) 5,437,985 Interest expense - other 45,487 - - - 45,487
Total debt maintenance 45,487 1,220,631 4,393,932 (176,578) 5,483,472 Income (loss) from operations before
other expenses 934,570 598,795 (2,155,813) (2,075,561) (2,698,009) Other expenses
Depreciation and amortization 39,507 1,528,091 6,837,976 (120,378) 8,285,196 Other entity expenses - 265,760 229,366 (384,791) 110,335 Total other expenses 39,507 1,793,851 7,067,342 (505,169) 8,395,531 Change in net assets $ 895,063 $ (1,195,056) $ (9,223,155) $ (1,570,392) $ (11,093,540)

SUPPLEMENTARY INFORMATION (CONTINUED)
YEAR ENDED DECEMBER 31, 2021

STATEMENTS OF ACTIVITIES
29 This Page
Intentionally
Left Blank

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Packet Pg. 1439 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

CONSOLIDATED FINANCIAL STATEMENTS

AND SUPPLEMENTARY INFORMATION

WITH INDEPENDENT AUDITOR'S REPORT
YEAR ENDED DECEMBER 31, 2022

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

11.A.k
Packet Pg. 1440 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

INDEPENDENT AUDITOR'S REPORT
To the Board of Directors of
Hollywood Community Housing Corporation
(A California Not-For-Profit Corporation)
Opinion
We have audited the accompanying financial statements of Hollywood Community Housing Corporation, which comprise the consolidated statement of financial position as of December 31, 2022, and the related consolidated statement of activities, changes in net assets, and cash flows for the year then ended, and the related notes to the consolidated financial statements.

In our opinion, based on our audit and the reports of the component auditors, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Hollywood Community Housing Corporation as of December 31, 2022, and the results of its operations and its cash flows for the year then ended in accordance with accounting principles generally accepted in the United States of America.

We did not audit the financial statements of 15 controlled and wholly owned entities, of which the activity on these entities represents approximately $278.7 million of the total assets at December 31, 2022, and approximately $10.3 million of the total revenue for the year ended December 31, 2022, all respectively. Those statements were audited by component auditors, whose reports have been furnished to us, and our opinion, insofar as it relates to the amounts included for those entities, is based solely on the reports of the component auditors.

Hollywood Community Housing Corporation

Page 2 ends

Responsibilities of Management for the Consolidated Financial Statements In preparing the consolidated financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about Hollywood Community Housing Corporation's ability to continue as a going concern within one year after the date that the consolidated financial statements are available to be issued.

We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control related matters that we identified during the audit.
2 11.A.k
Packet Pg. 1441 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) Hollywood Community Housing Corporation

Page 3 ends

June 20, 2023 Dauby O'Connor & Zaleski, LLC
Carmel, Indiana Certified Public Accountants
3 Current assets
Cash, equivalents, and restricted cash
Cash $ 7,636,526
Restricted reserves 10,949,480
Total cash, equivalents, and restricted cash 18,586,006 Resident receivables 709,789
Prepaid expenses 348,548
Total current assets 19,644,343
Property and equipment
Land 42,669,709
Buildings and improvements 318,009,858
Furniture and equipment 5,550,587
Construction in progress 17,173,471
383,403,625
Less: Accumulated depreciation (73,309,157)
Total property and equipment 310,094,468
Other assets
Grants and contracts receivable 267,732
Notes and other related party receivables 4,912,489
Unamortized costs, net 419,803
Right-of-use-asset 36,772
Other assets 68,801
Total other assets 5,705,597
$ 335,444,408

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

CONSOLIDATED STATEMENT OF FINANCIAL POSITION
DECEMBER 31, 2022
ASSETS
See notes to financial statements
4 11.A.k
Packet Pg. 1442 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) Current liabilities
Accounts payable and accrued expenses $ 1,328,442
Prepaid revenue 257,627
Accrued interest - current 616,065
Mortgages and notes payable - current maturities 7,632,140 Total current liabilities 9,834,274
Deposit liabilities
Resident security deposits 872,335
Long term liabilities
Mortgages and notes payable, net of current maturities 23,927,520 Mortgages and notes payable (deferred) 168,685,587
Less: Unamortized debt issuance costs (1,258,740)
Due to affiliates - long-term 21,104
Accrued interest - long-term 35,941,499
Total long term liabilities 227,316,970
Total liabilities 238,023,579
Net assets - without donor restrictions
Controlling interest (1,157,088)
Non-controlling interest 98,263,427
Total net assets - without donor restrictions 97,106,339 Net Assets - with donor restrictions 314,490
Total net assets 97,420,829
Total liabilities and net assets $ 335,444,408

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

CONSOLIDATED STATEMENT OF FINANCIAL POSITION
DECEMBER 31, 2022

LIABILITIES AND NET ASSETS
See notes to financial statements
5 HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)
Revenues
Net rental income $ 13,270,034
Contribution income 281,201
Government contracts and grants 3,973,865
Special events income 5,612
Interest income, net 19,721
Investment income -
Other income 1,146,267
Total revenue 18,696,700
Operating expenses
Administration 2,030,547
Management fees 637,798
Salaries and benefits 4,767,676
Utilities 1,573,683
Repairs and maintenance 3,200,521
Taxes and insurance 767,250
Total operating expenses 12,977,475
5,719,225
Debt maintenance
Interest expense 5,427,647
Total debt maintenance 5,427,647
Income (loss) from operations before other expenses 291,578 Other expenses
Depreciation and amortization 8,617,229
Other entity expenses 69,785
Total other expenses 8,687,014
Change in net assets $ (8,395,436)

CONSOLIDATED STATEMENT OF ACTIVITIES
YEAR ENDED DECEMBER 31, 2022
expenses
Income (loss) from operations before debt maintenance and other See notes to financial statements
6 11.A.k
Packet Pg. 1443 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

CONTROLLING INTEREST
Balance, January 1, 2022 $ (1,834,656)
Other changes in controlling interest (9,409)
Change in net assets 686,977
Balance, December 31, 2022 $ (1,157,088)

NON-CONTROLLING INTEREST
Balance, January 1, 2022 $ 79,167,327
Contributions 28,145,397
Other changes in non-controlling interest 202,606
Change in net assets (9,251,903)
Balance, December 31, 2022 $ 98,263,427
Balance, January 1, 2022 $ 145,000
Change in net assets - with donor restrictions 169,490
Balance, December 31, 2022 $ 314,490

CONSOLIDATED STATEMENT OF CHANGES IN NET ASSETS
DECEMBER 31, 2022

NET ASSETS - WITHOUT DONOR RESTRICTIONS

NET ASSETS - WITH DONOR RESTRICTIONS
See notes to financial statements
7 HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)
Cash flows from operating activities
Change in net assets $ (8,395,436)
Adjustments to reconcile change in net assets to net
cash provided by (used in) operating activities:

Depreciation and amortization 8,617,229
Amortization - right-of-use asset 471
Amortization - debt issuance costs 132,976
Forgiveness of debt 266,545
Changes in:

Resident receivables (146,955)
Grants and contracts receivable (133,205)
Notes and other related party receivables (1,138,169)
Prepaid expense (138,434)
Accounts payable and accrued expenses (3,108,504)
Due to related party (1,097)
Accrued interest 3,312,458
Prepaid revenue 139,864
Security deposit liability 4,600
Net cash provided by (used in) operating activities (587,657) Cash flows from investing activities
Payments for property and equipment (15,599,350)
Notes and other related party receivables (3,482,204)
Net cash provided by (used in) investing activities (19,081,554) Cash flows from financing activities
Contributions 28,145,397
Proceeds from mortgages and notes payable 28,224,542
Principal payments on mortgages and notes payable (37,866,122) Increase in net assets - with donor restrictions (100,000) Payments for debt issuance costs (133,722)
Net cash provided by (used in) financing activities 18,270,095 Net change in cash and cash equivalents (1,399,116)
Cash and equivalents, beginning 19,985,122
Cash and equivalents, ending $ 18,586,006
Supplemental disclosure of other information
Cash paid for interest $ 2,539,993

CONSOLIDATED STATEMENT OF CASH FLOWS
YEAR ENDED DECEMBER 31, 2022
See notes to financial statements
8 11.A.k
Packet Pg. 1444 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2022
NOTE 1-ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Entity DBA Units Ownership %
Controlled Entities
Alexandria House Apartments, LP Alexandria House Apartments 16 0.0051 Palo Verde Apartments, LP Palo Verde Apartments 49 0.010 Paul Williams Apartments, LP Paul Williams Apartments 41 0.010 Florence Mills Apartments, LP Florence Mills Apartments 74 0.010 Gramercy Place Apartments, LP Gramercy Place Apartments 64 0.010 Stanford Avenue Apartments, LP Stanford Avenue Apartments 85 0.010 HCHC Recap 1, LP Argyle, Carlton Way, Wilcox 68 0.010
Hollywood Bungalow Courts, LP Hollywood Bungalow Courts 42 0.010 Luna Vista, LP Luna Vista Apartments 73 0.010
Mariposa Place Apartments, LP Mariposa Place Apartments 58 0.010 Coronel Apartments, LP Coronel Apartments 54 0.010
Step Up on Colorado, LP Step Up on Colorado 34 0.005
Step Up on Vine, LP Step Up on Vine 34 0.005
Wholly Owned Entities
Not separately incorporated Argyle Court Apartments 23 100.000 Not separately incorporated Orchard Gables n/a 100.000
Not separately incorporated Peak Plaza Apartments n/a 100.000 Innes Heights, LP Innes Heights Apartments 19 100.000
Barnsdall Court, LP Barnsdall Court Apartments 38 100.000 Selma-Hudson Community, LP Casa Verde Apartments 30 100.000 Dunning Apartments Partnership, LP Dunning Apartments 26 100.000 Kenmore Apartments, LP Kenmore Apartments 21 100.000
Mirada Terrace Apartments, LP Mirada Terrace Apartments 30 100.000 St. Andrew's Community, LP St. Andrew's Bungalow Court 16 100.000 Harold Way Apartments, LP Harold Way Apartments 51 100.000 Palomar Apartments, LP Palomar Apartments 27 100.000
Views at 270, LP Views Apartments 56 100.000
Walnut Park, LP Walnut Park Apartments 64 100.000
Allesandro Housing 811-01 Allesandro Housing 18 100.000 Waterloo Heights 811-97 Waterloo Heights Apartments 18 100.000 9 HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2022
Entity DBA Units Ownership %
Equity Method Investments
La Brea Franklin, LP La Brea Franklin Apartments 40 20.000 Western Carlton Apartments, LP Western Carlton Apartments I 61 0.100 Western Carlton II, LP Metro Hollywood 60 0.005
Palm Vista, LP Palm Vista Apartments 91 0.0049
Venice Dell, LP Venice Dell Community 140 0.0049
During the year ended December 31, 2022, construction on Luna Vista Apartments (73 units) and Palm Vista Apartments (91 units) were in process. Walnut Park Apartments (64 units) will commence construction in 2023, and Peak Plaza Apartment (104 units) and Venice Dell Community (140 units) are in predevelopment.

The majority of the Corporation's Wholly Owned Entities are separately incorporated partnerships.

Housing Operations - HCHC's housing operations includes the operations of the Properties and its asset management department which develops and implements strategies to ensure the long-term health of its properties for the benefit of its residents. HCHC also manages 360 units as of December 31, 2022 and anticipates self managing additional Properties in future periods. The department monitors the lease-up process of new buildings, supervises property management operations, analyzes financial performance, imposes control over property maintenance, mediates resident grievances, and works with its housing development department on design considerations for new buildings. The asset management team actively seeks out ways to lower operating expenses, primarily through green initiatives and energy savings programs. 10 11.A.k
Packet Pg. 1445 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2022
Housing Development - HCHC's core program is the development of affordable housing. HCHC is committed to doing its part to address the housing crisis and is building affordable housing, including permanent supportive housing (PSH) at the fastest rate in the organizations history.

Since its inception HCHC has developed 32 properties that house over 2,500 people in 1,153 apartment units of safe, attractive and centrally located affordable housing. Residents of HCHC properties have extremely low to low-incomes, typically earning below 60% of the area median income. All of HCHC's housing units are affordable and almost 40% of HCHC's housing units are designated to support individuals with special needs and their families, those diagnosed with HIV/AIDS, those who have formerly experienced chronic homelessness, and persons living with co-occurring and multiple diagnosed conditions. Three of HCHC's buildings are dedicated to serving seniors only, and one specifically serves seniors living with special needs.

Resident Services - HCHC's resident services program provides care coordination, referral and linkage to resources, crisis intervention, a food pantry, ESL classes, GED instruction, group/individual therapy, and life-skills classes. When circumstances like a pandemic are not a factor, HCHC's Food Pantry is open once a week to HCHC residents and the community at large and provides food staples, meat, and vegetables every month. People accessing the food pantry include a number of HCHC residents living with special needs, low-income households in the neighboring community, and individuals who may identify as homeless.

The financial statements also consolidate the assets, liabilities, and activities of the Corporation and various limited partnerships and limited liability companies for which the Corporation, as the general partner or managing member, has a controlling financial and legal interest. All significant intercompany transactions have been eliminated in the consolidation. 11 HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2022
Net assets without donor restrictions - controlling interests Net assets without donor restrictions - controlling interests are not restricted by donor-imposed stipulations and are available for use at the discretion of the board of directors and/or management for general operating purposes. The only limits on net assets are broad limits resulting from the nature of the Corporation and the purposes specified in its articles of incorporation or bylaws and, perhaps, limits resulting from contractual agreements. From time to time the board designates a portion of these net assets for specific purposes which makes them unavailable for use at management's discretion.

Net assets without donor restrictions - noncontrolling interests Net assets without donor restrictions - noncontrolling interests represent the aggregate balance of the third party limited partners' equity interest, generally 99.99%, in the controlled limited partnerships that are included in the consolidated financial statements.

New accounting pronouncements
In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-02, Leases, which requires the lessee to recognize leased assets and corresponding lease liabilities on the Consolidated Statements of Financial Position. This standard was effective for Corporation on January 1, 2022. The Corporation elected to adopt the standard using the modified retrospective approach which requires leases to be measured and recognized at the beginning of the period of adoption with no restatement of prior periods. The impact of implementation of FASB ASU 2016-02 was the recognition of a "right-of-use" asset of $36,772 and an adjustment to net assets without donor restrictions of $9,428 on January 1, 2022.

The Corporation elected to apply the following practical expedients related to the adoption of the new guidance: (1) not reassessing whether a contract includes an embedded lease at adoption, the previously determined classification of a lease as operating or finance lease, or the treatment of prior initial direct costs; (2) using hindsight to determine the lease term and assessing impairment on right-of-use assets.
12 11.A.k
Packet Pg. 1446 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2022
In March 2020, FASB issued ASU 2020-04, Reference Rate Reform (Topic 848), which provides optional guidance for a limited period of time to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting. The standard is effective from March 2020 through December 31, 2022 and will allow the Corporation to adopt other reference rates without applying the contract modifications provisions of accounting standards generally accepted in the United States of America. During the year ended December 31, 2022, ASU 2020-04 did not have a material impact on the Corporation. Management expects to apply the provisions of ASU 2020-04 once the LIBOR reference rate related to the debt is discontinued.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses. The amendments in this ASU replace the incurred loss model with a methodology that reflects the "current expected credit losses" over the life of the loan and requires consideration of a broader range of reasonable and supportable information to calculate credit loss estimates. ASU 2016-13 replaces the incurred loss impairment methodology with a new methodology that reflects expected credit losses over the lives of the loans and requires consideration of a broader range of information to form credit loss estimates. The ASU requires an organization to estimate all expected credit losses for financial assets measured at amortized cost, including loans and held-to-maturity debt securities, based on historical experience, current conditions, and reasonable and supportable forecasts. The amendments in ASU 2016-13 are effective for fiscal years beginning after December 15, 2022. The amendments are not expected to have a material impact on the Corporation's financial statements.

Cash and cash equivalents
For the consolidated statement of cash flows, all unrestricted cash and restricted cash with original maturities of three months or less are considered cash. At December 31, 2022, cash consists of operating checking and money market accounts. The carrying amount of cash and deposits held in trust-funded accounts approximates fair value due to the type of investments and the maturity dates.

Resident receivable and bad debt policy
The Properties' resident rent charges for the current month are due on the first of the month.

Residents who are evicted or move-out are charged with damages or cleaning fees, if applicable.

Resident receivables consist of amounts due for rental income or the charges for damages and cleaning fees. The Properties do not accrue interest on the resident receivable balances.

Resident receivables are charged to bad debt expense when they are determined to be uncollectible based upon a periodic review of the accounts by management. Accounting principles generally accepted in the United States of America require that the allowance method be used to recognize bad debts; however, the effect of using the direct write-off method is not material to the consolidated financial statements for the year ended December 31, 2022. Bad debts expensed for the year ended December 31, 2022 totaled $134,291.
13 HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2022
Developer fee receivable
Developer fee receivable consists of amounts earned in connection with the development of affordable housing facilities and are based on a percentage of development costs incurred and is eliminated in consolidation. Amounts due from the housing facilities are stated at unpaid balances, less an allowance for doubtful accounts. The Corporation may accrue interest on the developer fee receivable balance. As of December 31, 2022, the allowance for doubtful accounts relating to the developer fee receivable totaled $-0-. Bad debts expensed for the year ended December 31, 2022 totaled $-0-.

Costs that are deemed to increase the useful life of the property or equipment are capitalized.

When assets are sold or otherwise disposed of, the costs and related reserves are removed from the accounts, and any resulting gain or loss is included in operations.

The Properties incurred costs related to the construction period, including development service fees, interest, real estate taxes, and insurance, which are capitalized and included in property and equipment.

Pre-development costs receivable
Pre-development costs receivable consist of amounts advanced to fund entity formation and predevelopment of affordable housing facilities. Amounts due from the housing facilities are stated at unpaid balances, less an allowance for doubtful accounts. As of December 31, 2022, the allowance for doubtful accounts relating to the pre-development costs receivable totaled $-0-. Bad debts expensed for the year ended December 31, 2022 totaled $-0-.

Management periodically reviews notes receivable and uses an allowance for doubtful accounts to recognize bad debts. Notes receivable on the Consolidated Statement of Financial Position is shown net of the allowance for doubtful accounts. As of December 31, 2022, the allowance for doubtful accounts relating to the notes and other related party receivables totaled $-0-. Bad debts expensed for the year ended December 31, 2022 totaled $-0-.
14 11.A.k
Packet Pg. 1447 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2022
Investment in partnerships
The Corporation does not consolidate the accounts and activities of certain Properties it considers equity investments. The Corporation has determined that it is unable to exercise significant influence of the limited liability entities under FASB ASC 958-810. The Corporation accounts for its equity investments in accordance with the equity method of accounting, under which the equity investment is carried at cost and is adjusted for the Corporation's share of net income or loss and by cash distributions received. Equity in loss of each equity investment allocated to the Corporation is recognized to the extent of the Corporation's equity investment balance. Previously unrecognized equity in loss is recognized in the year in which equity in income is earned by such equity investment or additional investment is made by the Corporation. Distributions received subsequent to the elimination of an equity investment balance will be recorded as other income. Advances and additional capital contributions will be recorded as additional equity investments if they occur. The Corporation assesses the carrying value of its equity investments whenever there are indications that a permanent impairment may have occurred. No impairment losses were recognized during the year ended December 31, 2022.

Unamortized costs
Certain Properties incurred costs including California Tax Credit Allocation (TCAC) monitoring fees which are being amortized over 10-15 year terms using the straight-line method.

Mortgages and notes payable (deferred)
The Corporation and Properties have obtained financing which do not typically require payments unless the Properties cease to provide affordable housing or fail meet other requirements in the loan agreements. Payments if required are due at maturity or annually in the event of positive residual receipts as stated in the loan agreements. These loans are presented as deferred on the consolidated statements of activities.

Contingent interest
Certain Properties do not record contingent interest due on certain notes payable as the Corporation anticipates it will be forgiven upon loan maturity.

Contributions
Syndication costs incurred in connection with generating contributions of the non-controlling interests are reported net of syndication costs for financial reporting purposes. 15 HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2022
Rental income
The Properties' rental income is recognized as rents become due. Rental payments received in advance are deferred until earned. All leases between the Properties and the residents of the property are operating leases under FASB ASC 842 and are not within the scope of FASB ASU 2014-09.

Management fee income
The Corporation's management fee income is earned based on the terms as outlined in the management agreements between HCHC and various properties. Management fees are typically paid by various properties one month in arrears.

Advertising costs
The Properties' advertising costs are expensed as incurred and are included in administrative expenses in the consolidated statement of activities.

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

Unamortized costs
Certain Properties incurred costs including California Tax Credit Allocation (TCAC) monitoring fees which are being amortized over 10-15 year terms using the straight-line method.

Contingent interest
Certain Properties do not record contingent interest due on certain notes payable as the Corporation anticipates it will be forgiven upon loan maturity.

Advertising costs
The Properties' advertising costs are expensed as incurred and are included in administrative expenses in the consolidated statement of activities.

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2022
Functional allocation of expenses
The Corporation's program is to provide affordable housing and those costs have been summarized on a functional basis in the table below. Management and general expenses include those expenses that are not directly identifiable with any other specific function but provide for the overall support and direction of the Corporation.

Concentration of credit risk
The Corporation maintains various cash balances at one financial institution. The balances in the accounts are insured by the Federal Deposit Insurance Corporation up to $250,000. From time to time during the period, the cash balances held at the institution exceeded the FDIC Insurance Limit. Management monitors the financial strength ratings of the institution on a periodic basis.

Subtotal
Housing Housing Resident Program Management
Operations Development Services Services and General Fundraising Total Administration $ 1,732,546 $ 118,232 $ 69,649 $ 1,920,427 $ 83,299 $ 26,821 $ 2,030,547 Management fees 637,798 - - 637,798 - - 637,798
Salaries and benefits 3,264,917 596,221 351,226 4,212,364 420,059 135,253 4,767,676 Utilities 1,566,705 2,768 1,631 1,571,104 1,951 628 1,573,683 Repairs and
maintenance 3,191,472 3,590 2,115 3,197,177 2,530 814 3,200,521 Taxes and insurance 736,646 12,142 7,153 755,941 8,555 2,754 767,250 Interest expense 5,373,286 21,568 12,705 5,407,559 15,195 4,893 5,427,647 Depreciation
and amortization 8,585,048 12,768 7,521 8,605,337 8,996 2,896 8,617,229 Other entity expense 69,785 - - 69,785 - - 69,785
$ 767,289 25,158,203 $ $ 26,377,492 452,000 $ $ 540,585 $ 174,059 $ 27,092,136 Program Services
17 HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2022
Accounting for uncertainty in income taxes
The Corporation is exempt from federal income tax under Section 501(c)(3) of the Internal Revenue Code and state income tax and has been classified as other than a private foundation.

Accordingly, no provision for federal and state taxes on revenue and income has been recognized in the accompanying financial statements.

Even though the Corporation is recognized as tax exempt, it still may be liable for tax on its unrelated business income ("UBI"). The Corporation evaluates uncertain tax positions through its review of the sources of income to identify UBI and certain other matters, including those which may affect its tax-exempt status. The effect of the uncertainty would be recorded if the outcome was considered probable and reasonably estimable. As of December 31, 2022, the Corporation had no uncertain tax positions requiring accrual.

Accordingly, these Consolidated Financial Statements do not reflect a provision for income taxes and these entities have no other tax positions which they must consider for disclosure. There has been no interest or penalties recognized in the consolidated statement of activities or Consolidated Statement of Financial Position for the year ended December 31, 2022. Generally, the federal and state returns are subject to examination for three years after the later of the original or extended due date or the date filed with the applicable tax authorities.

Subsequent events
Management performed an evaluation of the Corporation's activity through June 20, 2023, the audit report date, and has concluded that there are no significant subsequent events requiring disclosure through the date these consolidated financial statements were available to be issued except as disclosed in Notes 6 and 10.
18 11.A.k
Packet Pg. 1450 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2022
NOTE 2-RESTRICTED CASH
The Properties have various cash balances which are segregated and restricted and consist of resident security deposits, replacement reserves, interest reserves, operating reserves, and other reserves which are required to be maintained by various operating, regulatory, or lending agreements. The Properties' designated restricted cash balances held as of December 31, 2022, consisted of the following:

Operating reserves $ 3,635,462
Replacement reserves 3,602,303
Security deposits 915,601
Construction reserves 897,184
Other reserves 1,898,930
$ 10,949,480
NOTE 3-LIQUIDITY AND AVAILABILITY OF FINANCIAL ASSETS
The Corporation manages its liquidity by providing sufficient funds for general expenditures in meeting liabilities and other obligations as they become due and maintains cash and cash equivalents that may be drawn upon as needed during the year to manage cash flow and make necessary expenditures. The Corporation's cash and cash equivalents is available within one year of the statement of financial position date to meet cash needs for general expenditures. The Corporation's available financial assets as of December 31, 2022, consisted of the following:

Cash and cash equivalents $ 7,636,526
Receivables 1,332,450
Less: board designated cash ( 1,040,400)
Less: net assets with use restrictions ( 314,490)
$ 7,614,086
The board of directors designates 3 months of budgeted operating expenses as an operation reserve. The Properties' restricted cash may also be drawn upon in the event of financial distress, to make improvements to the properties or an immediate liquidity need resulting from events outside the typical life cycle of converting financial assets to cash or settling financial liabilities. In addition, the Corporation maintains a line of credit for additional liquidity.

NOTE 4-INVESTMENTS IN UNCONSOLIDATED PARTNERSHIPS
The Corporation and its affiliates hold investments in limited partnerships that are not consolidated.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2022
The following is a summary of the financial information of Corporation's equity interest in limited partnerships not controlled by the Corporation and accounted for in accordance with the equity method:

Income HCHC
Entity Assets Liabilities (Loss) Equity
La Brea Franklin, LP $ 2,294,228 $ 7,795,588 $( 279,061) -0- Palm Vista, LP 32,283,530 29,254,727 432 -0-
Western Carlton Apartments, LP 6,391,869 5,472,237 45,398 -0- Western Carlton II, LP 8,114,712 8,631,547 ( 362,109) -0- Venice Dell, LP 2,588,902 2,588,902 -0- -0-
NOTE 5-UNAMORTIZED COSTS
Certain Properties incurred costs including California Tax Credit Allocation (TCAC) monitoring fees which are being amortized over 10-15 year terms using the straight-line method.

NOTE 6-MORTGAGES AND NOTES PAYABLE
HCHC Notes
Note payable to Union Bank in the original amount of $500,000. The note bears interest at the reference rate plus 0.5% per annum and matures June 2023. Interest only payments are required monthly. $ -
Note payable to Wells Fargo in the original amount of $500,000. The note was amended in 2021, bears simple interest at 2% per annum and matures December 2027. Interest only payments are required quarterly through April 2026. Thereafter, quarterly principal payments of $62,500 are required in addition to interest payments. $ 500,000
Note payable to City of Los Angeles Housing Department (HCIDLA) in the original amount of $3,132,000. The note bears simple interest at 5% per annum and matures November 2061. Annual payments are due from residual receipts, as defined. The note is secured by a deed of trust on the real property and assignment of rents. $ 3,132,000
Note payable to the City of Los Angeles in the original amount of $1,113,875. The note bears simple interest at 5% per annum and matures October 2030. Annual payments are due from residual receipts, as defined.

The note is secured by a deed of trust on the real property. $ 1,113,875 Note payable to the City of Los Angeles in the original amount of $1,240,715. The note bears simple interest at 5% per annum and matures November 2038. Annual payments are due from 77.54% of residual receipts, as defined. The note is secured by a deed of trust on the real property. $ 1,190,715
20 11.A.k
Packet Pg. 1451 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2022
Note payable to City National Bank in the original amount of $400,000. The note is non-interest bearing and matures November 15, 2072. Unpaid amounts are due at the maturity date. The note is secured by a deed of trust on the real property. $ 400,000
Note payable to City National Bank in the original amount of $480,000. The note is non-interest bearing and matures December 16, 2071. Unpaid amounts are due at the maturity date. The note is secured by a deed of trust on the real property. $ 480,000
Note payable to City National Bank in the original amount of $890,000. The note is non-interest bearing and matures July 1, 2036. Unpaid amounts are due at the maturity date. The note is secured by a deed of trust on the real property. $ 890,000
Note payable to Bank of America in the original amount of $530,000. The note is non-interest bearing and matures December 1, 2074. Unpaid amounts are due at the maturity date. The note is secured by a deed of trust on real property. $ 530,000
Note payable to Nonprofit Finance Fund in the original amount of $1,500,000. The note bears simple interest at 5.50% per annum and matures December 22, 2023. $ 1,500,000
Principal payments for the next five year and thereafter are approximately as follows:
2023 $ 1,500,000
2024 -
2025 -
2026 187,500
2027 312,500
Thereafter 7,736,590
$ 9,736,590
Debt issuance costs incurred by the Corporation through December 31, 2022 in connection with obtaining long term financing totaled $15,000. Amortization expense for the year ended December 31, 2022, totaled $5,000 and is included in interest on the statement of activities. Accumulated amortization at December 31, 2022 totaled $10,000.

Wholly Owned Entities Notes
Note payable to the City of Los Angeles (Orchard Gables) in the original amount of $1,910,915. The note bears simple interest at 3% per annum and matures January 2031. If the property continues to operate in accordance with the loan agreement, as defined, the lender forgives 5% of any unpaid principal and interest. This determination is made on an annual basis. The note is secured by a deed of trust on the real property. $ 856,763 21 HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2022
Note payable to the City of Los Angeles (Argyle Court) in the original amount of $437,479. The note bears simple interest at 5% per annum and is subject to interest forgiveness at the end of the loan term. The note matures March 2037 or at the time of sale or refinance. The Partnership is required to make annual payments from residual receipts, as defined. The note is secured by a deed of trust on real property. $ 435,498
Note payable to the City of Los Angeles (Argyle Court) in the original amount of $1,200,000. The note is non-interest bearing and matures March 2037 or at the time of sale or refinance. The Partnership is required to make annual payments from residual receipts, as defined. The note is secured by a deed of trust on the real property. $ 1,200,000
Note payable to the City of Los Angeles (Argyle Court) in the original amount of $135,000. The note is non-interest bearing and matures at the time of sale or refinance. The Partnership is required to make annual payments from residual receipts, as defined. The note is secured by a deed of trust on the real property. $ 135,000
Six amortizing notes payable to various lenders at differing amounts. The notes bear interest ranging from 4.09% to 8.45% per annum and have maturity dates ranging from August 2024 to May 2035. The notes are secured by deeds of trust on real property. $ 5,640,649 Eighteen non-amortizing notes payable to various lenders at differing amounts. The notes bear interest ranging from zero to 5.96% per annum and have maturity dates ranging from August 2028 to April 2061. Principal and interest payments from residual receipts are required, as defined. The notes are secured by deeds of trust on real property. $ 22,675,701 Two non-amortizing notes payable to HUD under Section 811 of the Housing Act in the original amount of $3,514,300. The notes are non-interest bearing. Notes are subject to loan forgiveness if the properties continue to operate in accordance with the loan agreements. $ 3,514,300 Five non-amortizing notes payable to various lenders at differing amounts.

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2022
Note payable to Century Housing Corporation (Peak Plaza) in the original amount of $6,375,000. The note bears compound interest at the SOFR rate + 4.5% with a minimum rate of 6% per annum due monthly. The note matures August 2024 at which date all unpaid principal and interest are due. $ 5,615,000
Note payable to Local Initiatives Support Corporation (Peak Plaza) in the original amount of $1,000,000. The note bears interest at a rate of 2.9% per annum due monthly. The note matures August 2024 at which date all unpaid principal and interest are due. $ 56,778
Note payable to Local Initiatives Support Corporation (Peak Plaza) in the original amount of $500,000. The note bears interest at a rate of 5.75% per annum due monthly. The note matures August 2024 at which date all unpaid principal and interest are due. $ 85,864
Principal payments for the next five year and thereafter after eliminations are approximately as follows:
2023 $ 5,533,934
2024 6,275,331
2025 321,257
2026 302,723
2027 3,546,937
Thereafter 31,904,268
$ 47,884,450
Controlled Limited Partnership Notes
Nine amortizing notes payable to various lenders at differing amounts. The notes bear interest ranging from 4.47% to 6.20% per annum and have maturity dates ranging from August 2030 to November 2054. The notes are secured by deeds of trust on real property. $ 18,335,641 Forty-four non-amortizing notes payable to various lenders at differing amounts. The notes bear interest ranging from zero to 6% per annum and have maturity dates ranging from December 2025 to April 2076. Principal and interest payments from residual receipts are required, as defined. The notes are secured by deeds of trust on real property. $ 124,288,566 Principal payments for the next five year and thereafter after eliminations are approximately as follows:
2023 $ 598,206
2024 621,907
2025 7,972,734
2026 689,924
2027 733,794
Thereafter 132,007,642
$ 142,624,207
23 HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2022
NOTE 7-GRANT INCOME
The Corporation's affiliate HCHC Palm Vista IIG, LLC was awarded a $4,186,800 grant from the Infill Infrastructure Grant Program with Department of Housing and Community Development, a public agency of the State of California. At December 31, 2022, funds received totaled $3,640,603 which was utilized to fund a loan to Palm Vista, LP (see Note 8).

The Corporation's affiliate HCHC Luna Vista IIG, LLC was awarded a $3,407,000 grant from the Infill Infrastructure Grant Program with Department of Housing and Community Development, a public agency of the State of California. At December 31, 2022, no funds have been received.

NOTE 8-RELATED PARTIES
Development income
The Corporation provides services in connection with the development of various Properties. These contracts are at times subject to investor or regulatory agency approval and performance standards. For the year ended December 31, 2022, development fee revenue before eliminations totaled $660,000.

Management and partnership fee income
The Corporation provides services in connection with the management of various Properties. These contracts are at times subject to investor or regulatory agency approval and performance standards. For the year ended December 31, 2022, management fee revenue before eliminations totaled $568,732.

NOTE 9-RETIREMENT PLAN
Employees of the Corporation may participate in an Internal Revenue Code section 403(b) retirement savings plan. The plan is funded solely by employee contributions to the plan, pursuant to a salary reduction agreement. All employee contributions are immediately vested.

On July 1, 2022, HCHC began 100% matching employees' contributions to their 403(b) funds, up to 3% of the employee's salary. Matching funds portion of the contributions vest over 3 years.

Employee participation in the program is 95% as of December 21, 2022. 24 11.A.k
Packet Pg. 1453 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2022
NOTE 10-COMMITMENTS AND CONTINGENCIES
Guarantees
As general partner or managing member of various entities, the Corporation or affiliates have made certain guarantees. Guarantees typically include the following:
 To ensure the completion of project development and obtain permanent financing  To guaranty the reimbursement of investor limited partner in the event of tax credit recapture
 To lend funds to the partnership to fund any operating deficits during various terms outlined in partnership and debt agreements
As of December 31, 2022, the Corporation had ongoing development completion guaranty agreements on Luna Vista. The estimated development budget is $46.9 million, of which approximately $10 million were incurred as of December 31, 2022.

Contingent interest
Three Properties (Dunning Apartments, St. Andrews Community, and Argyle Court) have loan and regulatory agreements with the City of Los Angeles which provide for possible forgiveness of interest at the end of the note's 40-year term in the event the fair market value of the property (as defined) exceeds the principal balance of the note plus all superior indebtedness secured against the property. Accordingly, interest on the notes have not been accrued in the accompanying consolidated financial statements because the future fair market value of the property at loan maturity is not expected to be sufficient. At December 31, 2022, the Corporation is contingently liable for the cumulative amount of unpaid interest that could be due on the note, which approximated $3,518,000, if the fair market value of the properties is sufficient at loan maturity.
25 HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2022
The deferral provisions related to the accrual of interest expense discussed above, and as stipulated in the respective loan agreements remain in effect only as long as the properties are operated and maintained as low-income housing and the Properties comply with various other provisions of the agreements. In the event that the Properties are not maintained as low-income housing, or if there are other material violations of the loan agreements, the mortgage notes become due and payable.

Although this is a possibility, management deems the contingency remote and plans to meet the conditions as set forth in the provisions of the loan agreements. 26 11.A.k
Packet Pg. 1454 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)
HCHC Wholly Controlled
Corp. Owned Entities Eliminations TOTAL
Current assets
Cash, equivalents, and restricted cash
Cash $ 4,423,347 $ 1,374,566 $ 1,838,613 $ - $ 7,636,526 Restricted reserves 153,102 4,282,718 6,513,660 - 10,949,480 Total cash , equivalents,
and restricted cash 4,576,449 5,657,284 8,352,273 - 18,586,006 Resident receivables 1,562 163,193 545,034 - 709,789
Prepaid expenses 34,484 84,063 230,001 - 348,548
Total current assets 4,612,495 5,904,540 9,127,308 - 19,644,343 Property and equipment
Land - 12,942,556 29,727,153 - 42,669,709
Buildings and improvements 1,300,234 66,997,618 261,095,111 (11,383,105) 318,009,858 Furniture and equipment 413,245 1,390,434 3,746,908 - 5,550,587 Construction in progress 862 7,758,034 10,259,534 (844,959) 17,173,471 1,714,341 89,088,642 304,828,706 (12,228,064) 383,403,625 Less: Accumulated depreciation (716,140) (36,530,350) (36,867,159) 804,492 (73,309,157) Total property and equipment 998,201 52,558,292 267,961,547 (11,423,572) 310,094,468 Other assets
Developer fee receivable, non current 2,307,379 - - (2,307,379) - Grants and contracts receivable 267,732 - - - 267,732
Notes and other related party receivables 19,896,147 3,640,603 - (18,624,261) 4,912,489 Investments in partnerships 3,057,047 - - (3,057,047) - Unamortized costs, net - - 419,803 - 419,803
Right-of-use-asset - 36,772 - - 36,772
Other assets 10,000 23,581 35,220 - 68,801
Total other assets 25,538,305 3,700,956 455,023 (23,988,687) 5,705,597 $ 31,149,001 $ 62,163,788 $ 277,543,878 $ (35,412,259) $ 335,444,408

SUPPLEMENTARY INFORMATION
DECEMBER 31, 2022
ASSETS
27 HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)
HCHC Wholly Controlled
Corp. Owned Entities Eliminations TOTAL
Current liabilities
Accounts payable and accrued expenses $ 198,861 $ 391,326 $ 878,011 $ (139,756) $ 1,328,442 Prepaid revenue 11,501 145,375 100,751 - 257,627
Accrued interest - current - 174,214 441,851 - 616,065
Mortgages and notes payable -
current maturities 1,500,000 5,533,934 598,206 - 7,632,140 Total current liabilities 1,710,362 6,244,849 2,018,819 (139,756) 9,834,274 Deposit liabilities
Security deposits 6,000 312,979 553,356 - 872,335
Long term liabilities
Mortgages and notes payable, net
of current maturities - 6,190,085 17,737,435 - 23,927,520 Mortgages and notes payable (deferred) 8,236,590 38,465,021 134,406,485 (12,422,509) 168,685,587 Less: Unamortized debt issuance costs (5,000) (113,267) (1,140,473) - (1,258,740) Due to affiliates - long-term - 4,715,592 1,133,693 (5,828,181) 21,104 Accrued interest - long-term - 16,387,300 20,673,555 (1,119,356) 35,941,499 Developer fee payable - 51,385 2,319,739 (2,371,124) -
Total long term liabilities 8,231,590 65,696,116 175,130,434 (21,741,170) 227,316,970 Total liabilities 9,947,952 72,253,944 177,702,609 (21,880,926) 238,023,579 Net assets - without donor restrictions
Controlling interest 20,886,559 (10,090,156) 1,577,842 (13,531,333) (1,157,088) Non-controlling interest - - 98,263,427 - 98,263,427
Net Assets - with donor restrictions 314,490 - - - 314,490 Total net assets - without
donor restrictions 21,201,049 (10,090,156) 99,841,269 (13,531,333) 97,420,829 $ 31,149,001 $ 62,163,788 $ 277,543,878 $ (35,412,259) $ 335,444,408

SUPPLEMENTARY INFORMATION
DECEMBER 31, 2022

LIABILITIES AND NET ASSETS
28 11.A.k
Packet Pg. 1455 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA)

HOLLYWOOD COMMUNITY HOUSING CORPORATION
(A CALIFORNIA NOT-FOR-PROFIT CORPORATION)
HCHC Wholly Controlled
Corp. Owned Entities Eliminations TOTAL
Revenues
Net rental income $ - $ 4,829,866 $ 8,440,168 $ - $ 13,270,034 Contribution income 281,201 - - - 281,201
Government contracts and grants 804,901 3,168,964 - - 3,973,865 Special events income 5,612 - - - 5,612
Development income 660,000 - - (660,000) -
Management and partnership fee income 568,732 - - (568,732) - Interest income, net 216,885 3,168 13,903 (214,235) 19,721 Investment income 8,159 - - (8,159) -
Other income 346,251 443,773 521,237 (164,994) 1,146,267 Total revenue 2,891,741 8,445,771 8,975,308 (1,616,120) 18,696,700 Operating expenses
Administration 501,822 600,945 1,092,774 (164,994) 2,030,547 Management fees - 281,855 483,385 (127,442) 637,798
Salaries and benefits 2,530,591 843,174 1,393,911 - 4,767,676 Utilities 11,751 587,761 974,171 - 1,573,683
Repairs and maintenance 15,237 1,410,360 1,774,924 - 3,200,521 Taxes and insurance 51,535 248,727 466,988 - 767,250
Total operating expenses 3,110,936 3,972,822 6,186,153 (292,436) 12,977,475 Income (loss) from operations before
debt maintenance and other expenses (219,195) 4,472,949 2,789,155 (1,323,684) 5,719,225 Debt maintenance
Interest expense 91,542 1,289,553 4,226,898 (180,346) 5,427,647 Total debt maintenance 91,542 1,289,553 4,226,898 (180,346) 5,427,647 Income (loss) from operations before
other expenses (310,737) 3,183,396 (1,437,743) (1,143,338) 291,578 Other expenses
Depreciation and amortization 54,192 1,654,750 7,598,496 (690,209) 8,617,229 Other entity expenses - 241,539 216,589 (388,343) 69,785 Total other expenses 54,192 1,896,289 7,815,085 (1,078,552) 8,687,014 Change in net assets $ (364,929) $ 1,287,107 $ (9,252,828) $ (64,786) $ (8,395,436)

SUPPLEMENTARY INFORMATION
YEAR ENDED DECEMBER 31, 2022

STATEMENTS OF ACTIVITIES
29 This Page
Intentionally
Left Blank

11.A.k
Packet Pg. 1456 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) Appendix H
Supportive Services Plan,
TPC Letter of Commitment,
Supportive Services Budget
& DHS Funding Commitment

11.A.k
Packet Pg. 1457 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) Suppor�ve Services Plan
The People Concern (TPC) will serve as the lead suppor�ve service provider for Hollywood Community Housing Corpora�on’s proposed housing development located at 1217 Euclid Street, Santa Monica, CA 90404, 1211 14th Street, Santa Monica, CA 90404, and 1146 16th Street, Santa Monica, CA 90403. The proposed development will include 130 units of housing, with 40 units set aside as permanent suppor�ve housing (PSH) for people experiencing homelessness. TPC will serve as the lead suppor�ve service provider for 40 PSH units.

The residents of the project will receive intensive services they require, especially in the areas of mental health, substance abuse, health care. TPC will administer intensive services including case management, mental health services, crisis interven�on, individual therapy, rehabilita�on and therapeu�c groups, substance abuse services, and referrals to other services, if appropriate. All services will be voluntary.

Services:
• Life Skills Educa�on: The People Concern staff will provide comprehensive services including money management and socializa�on. Tenants will be provided the necessary life skills needed to pay rent on �me, be a good neighbor, and provide proper care for their unit, which are the common requirements for all rental housing and increases chances of successful tenancy. • Case management: Both prior to and a�er placement, tenants are assessed at regular intervals for their level of care needs using various psychosocial assessment tools. These assessments will determine the frequency of visits each tenant will need as well as provide baseline data to monitor stability. Tenants that are ini�ally placed into permanent housing may need to be visited three to four �mes a week by their case manager. As clients become more stable, the frequency of visits may decrease if appropriate.

In order to keep tenants housed who remain high acuity, case management services will remain intensive. In addi�on to helping clients with day-to-day needs and providing linkages to other forms of care, Case Managers will help with logis�cal challenges such as security deposits, furnishings, and assistance with move in funds.
• Individualized Service Plan: Case Managers will work with clients to assess which services will benefit the resident and to recommend par�cipa�on. Case managers will help each resident set goals specific to their situa�on, making them aware of all that is available to them and crea�ng a plan to achieve those goals. Each par�cipant will agree to receive suppor�ve services based on their individualized service needs as outlined in individualized service plans; in this way, tenants can remain successful in housing. • Mental Health Care: Comprehensive mental health care is provide through The People Concern’s onsite clinician. These individuals conduct assessments to all clients and provide individual psychotherapy when necessary. A number of wellness groups on specific topics are facilitated on-site. The People Concern mental staff are available for crisis interven�on, as well as consulta�on around client issues to nonclinical staff of the program. In the first weeks and months a�er a client moves into permanent housing, they benefit from increased contact with the case manager, clinician, and other care providers through home visits in an effort to provide adequate assistance needed to make the transi�on to more independence.
• Substance Use Services: The People Concern employs a Harm Reduc�on approach for clients living with substance addic�on, wherein TPC con�nues to work with clients while assis�ng them to receive treatment. The People Concern’s Wellness Program provides an array of groups and workshops designed to give clients the skills they need to begin to look at their substance addic�on, and over �me, to begin steps toward decreasing their substance use. Referrals to residen�al treatment facili�es are available when necessary.
• Housing Outplacement: The People Concern will research and provide linkages and advocacy for poten�al outplacements should they become an appropriate alterna�ve for a resident because they either require a higher level of care (i.e., residen�al treatment facility or hospital) or because permanent suppor�ve housing is no longer required (i.e., other affordable housing or market rate housing more atrac�ve to or more suitable for the individual becomes available). Such considera�ons will be a part of rou�ne case management.
• Medica�on Management: Case Managers are trained to provide assistance with maintaining medica�on regimen and will coordinate with medical team to ensure a stable rou�ne, as well as ensuring the pa�ent understands the importance of their medica�on and any side effects. • Peer Advocate Services: The People Concern uses peer support to enhance services and more effec�vely engage the tenants within specific programs. The People Concern has a strong commitment to support posi�ve peer influences. Visits from alumni may be part of the monthly programming coordinated by the Resident Service Coordinator. Peer support is necessary as shared experiences and understanding provide individuals with support and advocacy. • Benefits Assistance: Each resident will be assessed for an eligibility for benefits which they may not yet be receiving. Tenants are re-assessed regularly for eligibility in benefits programs. All poten�ally eligible tenants receive hands on assistance with enrollment, such as obtaining and compiling documents, and with transporta�on to appointments as needed.
• Social and Recrea�onal Ac�vi�es: All housed par�cipants are strongly encouraged to atend monthly community mee�ngs where speakers present on a variety of tenant educa�on topics. To encourage par�cipa�on, raffles are also held for household items. In addi�on to the community mee�ngs, case managers work to fully integrate tenants into the communi�es for which they are now housed by providing linkages to meaningful produc�ve ac�vi�es within their areas. The People Concern also leverages its large volunteer network for groups to facilitate ac�vi�es such as bingo and barbecues onsite. • Atendant care: The People Concern will work with In Home Suppor�ve Services (IHSS) so that residents who may need it can get appropriate care and remain in their own homes. As a part of Case Management, the TPC links residents with higher levels of care such as this when necessary. • Representa�ve Payee - The People Concern will provide a .2 FTE representa�ve payee on-site. The People Concern has extensive experience ac�ng in this role, including both interfacing with the Social

11.A.k
Packet Pg. 1458 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) Security Administra�on and in helping high acuity clients to manage their money effec�vely.

Culturally Competent Services
The People Concern staff receive training on cultural competencies, including an understanding of how cultural differences impact tenant care, and ways in which services can be adapted to meet cultural needs. Addi�onally, they are trained in diversity, interpersonal skills, conflict resolu�on, and effec�ve cross cultural communica�on. TPC staff are also skilled at using people-first language, including harm reduc�on language (not referring to the tenants by their disability), styles of verbal communica�on, writen communica�on, and non-verbal communica�on. Case Managers and others work to iden�fy transla�on services as needed, including by facilita�ng communica�on between the property manager and the non-English speaking tenants. The People Concern provides suppor�ve services in permanent suppor�ve housing to over 1,000 individuals throughout Los Angeles County and serves persons from diverse cultural backgrounds. 20% of The People Concern staff were formerly homeless or in recovery themselves, and a large por�on are bilingual. To foster understanding and promote diversity, staff also plan to hold various cultural events for tenants throughout the year. The People Concern also focuses on training staff on Diversity, Equity and Inclusion in the work place.

Addi�onally, staff will be trained on specific issues related to this popula�on, including understand the effects of an individual’s culture and beliefs on their interac�on with the health care system. The needs of adults experiencing homelessness and chronical homelessness specifically, will be addressed in a culturally competent and sensi�ve manner. Ensuring that staff understand cultural influences, will ensure that clients have good experiences with all services for which they are connected.

Case Managers:

The People Concern staff provide intensive case management services to each tenant. This includes the development of a rela�onship for staff and tenant to work towards resolu�ons of any challenges or barriers that may prevent stability in housing. The People Concern staff take both a Harm Reduc�on approach along with a "whatever it takes" approach to suppor�ve services. The long term goal of case management services is to enable tenants to become as stable and independent in housing as possible.

The case manager will conduct a psychosocial assessment to determine areas of greatest need as well as strengths. This includes help with ac�vi�es of daily living, mental health needs, self-management of symptoms, substance use issues, primary medical care needs, educa�onal and employment goals, benefits establishment, and planning leisure ac�vi�es. The case manager takes an ac�ve role in ensuring the client is successful in accessing services in each of these areas, interfacing with other on-site staff or facilita�ng transporta�on to off-site services. Also, the case manager will ensure linkage to appropriate off site referrals including but not limited to mental health and substance abuse services, paren�ng skills training, and family reunifica�on support if appropriate.

Individualized Service Plans
At �me of lease up, tenants will meet with the onsite case manager within 72 hours. During this mee�ng, the case manager will work with the tenant to complete an Ini�al Assessment and develop an Individualized Service Plan. Through this process the case manager will assist tenants in iden�fying their individual priority needs such as medical care, mental health care, stable income, educa�on/voca�onal training, independent living skills, and other suppor�ve services. Case Managers will meet frequently with each tenant to address any barriers to stable housing and document progress. Some tenants many need to be seen daily when first transi�oning into housing, decreasing intensity as they increase housing stability. Individualized Service Plans will be updated quarterly in order to ensure that the tenant is par�cipa�ng in goal se�ng and that the goals are being achieved. Residen�al services mee�ngs will take place bi-weekly in order that case managers receive input from other residen�al staff regarding progress and/or areas of concern. During these mee�ng, staff will look at updated assessment data as well as milestones achieved from stated goals in order to determine outcomes and iden�fy when addi�onal services are indicated.

Available Hours of Service:

The People Concern will provide two Case Managers, are full-�me employees who will be onsite 40 hours per week. The staff will be supervised by a Program Manager that will have a master’s degree and have experience with the special needs popula�on. These staff will work Monday through Friday with some evening hours when necessary in order to accommodate tenants that may be employed. These hours may also fluctuate depending on the events and schedules of residents. Suppor�ve services coordinated by the Case Manager can be scheduled on demand as well as through appointment. Many special events will take place, including holiday celebra�ons, and community building ac�vi�es. Case Managers will also help tenants schedule appointment to offsite providers, arranging transporta�on when necessary and ensuring easy access, adjus�ng their own schedule if necessary. All services will be available predominately during regular business hours. In addi�on, staff will be available 24/7 for crisis interven�on. A designated line will be established to reach an on-call crisis interven�on staff member for a�erhours emergencies
Transporta�on:

Clients will be provided with bus tokens as needed to make all scheduled appointments. The People Concern staff are available to take clients to appointment as part of their transi�onal services. In addi�on, case managers will u�lize public transporta�on with tenants as a means of u�lizing engagement, life skill, and case management techniques with tenants to further ensure successful tenancy. At �mes, Ly� may also be used to ensure that tenants make all medical appointments scheduled. Staff will determine most appropriate means of transporta�on during case management sessions.

Reasonable Accommoda�on:

The People Concern staff will offer tenants help in reques�ng reasonable accommoda�ons for all of its programs and services so that they are equally accessible and beneficial to individuals with disabili�es.

Service delivery will also keep in mind special needs such as recep�ve and expressive language

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Packet Pg. 1459 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) limita�ons, visual and hearing limita�ons, reading and wri�ng limita�ons and will accommodate through interpreters and Braille literature, etc. as needed.

TPC staff are skilled and experienced in providing assistance to applicants in reques�ng and naviga�ng the reasonable accommoda�ons procedure, both internally and externally, with such en��es as housing authori�es and property management. Staff are trained to understand the differences between property reasonable accommoda�ons versus external reasonable accommoda�ons. These processes are reviewed at least once per year.

Evic�on Policies:

Evic�on Preven�on services are provided using a team approach that involves The People Concern case manager with assistance from their supervisors. If rehabilita�ve services are needed out of the home during periods of crisis, staff will assess and place tenants in one of The People Concern’s respite beds, hospital, community treatment facility or rehabilita�on center un�l stability is regained. During this �me, tenants will be provided assistance with paying their rent to retain their housing while addressing their medical, substance abuse, physical or mental health issue. Landlord/tenant media�on will be provided as well. Should reloca�on be warranted, par�cipants who wish to move out of the jurisdic�on will be assisted by obtaining an alterna�ve housing plan to connect tenants with housing and suppor�ve services in the area of reloca�on. Evic�ons will only be ini�ated as a last resort where there is documented evidence of a serious lease viola�on. The People Concern staff will work collabora�vely with property management staff to be sensi�ve to the needs of the tenants and make every effort to keep the resident in housing. At ini�al lease up, tenants will develop a housing reten�on plan as part of their individualized service plans, and will work with The People Concern case management staff to update this plan quarterly. In the event that a behavioral or health and safety viola�on occurs, a behavioral contract and improvement plan will be tailored to encourage posi�ve engagement and prevent future infrac�ons, and will be coordinated with the resident, their case manager, the property manager. For cases of nonpayment of rent, The People Concern staff will assist tenants to work with property management to resolve the issue, and will have the op�on to agree to a rent payment program as well as enrolling in a money management program if late payment of rent becomes a patern. The People Concern staff can also refer residents to services agencies who may provide assistance.

In addi�on, The People Concern adheres to a 4-Step Housing Reten�on Procedure that is intended to support tenants to successfully maintain housing. One part of maintaining housing is helping tenants adhere to the guidelines of lease contract. When the Services and property management team becomes aware that a viola�on of the lease has occurred, they will offer support according to the 4-Step Housing Reten�on Procedure outlined below.

1. First incident: Step One
a. The Property Manager and Case Manager will provide verbal warning to the client informing them of the problem iden�fied or observed.
b. The Property Manager will discuss expecta�ons for change in order to prevent a writen warning no�ce.
c. The Case Manager will support client in discussing available supports and referrals to target the iden�fied issue or problem and support housing reten�on. d. Team will communicate understanding for �meline for scheduling mee�ng to discuss Step Two writen no�ce or review successful resolu�on of situa�on or problem.

2. Second incident: Step Two
a. The Property Manager will generate a writen warning no�ce / lease viola�on according to their company policies.
b. The Property Manager and Case Manager will present the writen no�ce to the client and reiterate the problem iden�fied or observed and how it violates the terms of the lease.
c. The Property Manager will discuss expecta�ons for change in order to prevent 3-day, 10- day, or 30-day perform (cure) or quit no�ce.
d. The Case Manager will support crea�on of a housing reten�on plan to address the issue or problem, support the client in iden�fying any barriers to carrying out the plan, and make updates, as needed.
e. Copy of reten�on plan will be shared with Property manager, if appropriate. f. Team will communicate understanding for �meline for scheduling mee�ng to discuss Step Three legal no�ce or review successful resolu�on of situa�on or problem.

3. Third incident:
a. The Property Manager will generate a -day, 10-day, or 30-day perform (cure) or quit no�ce according to their company policies.
b. The Property Manager and Case Manager will present the perform (cure) or quit no�ce to the client and reiterate the problem iden�fied or observed and how it violates the terms of the lease.
c. The Property Manager will discuss expecta�ons for change in order to prevent evic�on proceedings.
d. The Case Manager will review the reten�on plan to address the issue or problem, support the client in iden�fying any barriers to carrying out the plan, and make updates, as needed.
e. Copy of reten�on plan will be shared with Property manager, if appropriate. f. Team will communicate understanding for �meline for scheduling mee�ng to discuss Step Four evic�on proceedings or review successful resolu�on of situa�on or problem.

4. Fourth incident:
a. The Property Manager will provide updates to the Case Manager regarding legal proceedings to ini�ate evic�on.
b. The Case Manager will discuss op�ons with the client including par�cipa�ng in evic�on proceedings or writen relinquishment of unit.
c. Case Manager will support client in finding alterna�ve interim or permanent housing op�ons, as appropriate and available.

Outreach and Engagement with Applicants and Residents
The People Concern u�lizes the Asser�ve Community Treatment, or ACT model of early engagement.

ACT provides emo�onal and prac�cal support during the cri�cal �me of transi�on from street to home and strengthens the individual’s long-term �es to services, family and friends. Transi�oning to a new apartment and possibly a new community can be difficult to navigate when systems of care are

11.A.k
Packet Pg. 1460 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) fragmented and resources scarce. Regardless of popula�on, The People Concern staff is trained to u�lize a strength-based approach to assessing the tenant's established supports and resiliencies and build upon those founda�ons. The People Concern staff priori�zes early engagement by assis�ng the tenant with the difficult task of collec�on documenta�on, comple�ng applica�ons and atending appointments.

The services staff is trained in Trauma Informed Care, Harm Reduc�on principles and u�lizes the Stages of Change model and Mo�va�onal Interviewing to respect tenant choice and elicit change. Our Harm Reduc�on work focuses on decreasing the harmful consequences of problema�c use and works to address problema�c use from a trauma-focused or health-focused perspec�ve. The People Concern services team strives to bolster the tenant's internal and external resources and address the underlying issues regarding the use rather than focusing on the use itself. Addi�onally, our harm reduc�on strategies extend beyond substance use, and are applied to other areas such as mental health, medica�on compliance, money management and hoarding.

Tenants will be engaged in discussions regarding building opera�ons during monthly community mee�ngs. A sugges�on box will also all be place in a community space enabling tenants to make comments and sugges�on ways to improve the space in which they live. During these regular monthly mee�ngs, building staff will listen to tenants and address any sugges�ons or concerns. If building opera�on changes need to take place, building staff will first present changes to tenants and gather input.

Tenants will have access to client sa�sfac�on surveys that are model a�er the Home for Good guidelines.

These surveys will be easily accessible by clients and explore their perspec�ve on both the case management services they receive as well as their experience with property management and the building and community in which they reside. Staff will review results of the survey as a team and iden�fy areas of improvement. A sugges�on box will also all be place in a community space enabling tenants to make comments and sugges�on ways to improve the services. If services delivery changes are being planned, staff will first present changes to tenants and gather input. In addi�on, tenants will be made aware of grievance process at �me of intake. The upda�ng of individualized service plans on a quarterly basis will also present as an addi�onal opportunity for staff to obtain tenant par�cipa�on in service delivery.

Social and educa�onal programs will be developed and implemented by tenants, staff, and volunteers to foster community within the development and help tenants become comfortable with the service staff.

On-site ac�vi�es may include movie nights, game nights, reading groups and book clubs, spiritual groups, holiday celebra�ons, arts and cra�s, field trips, cooking classes and nutri�on counseling, AA/NA style mee�ngs, and a monthly tenant community mee�ng. The communal space in the building will help facilitate this programming. A monthly ac�vi�es calendar will be posted in a common area at the beginning of each month by the Resident Service Coordinator. Ac�vi�es will be open to all popula�ons in the building to help build cohesion. If tenants desire specialty ac�vi�es, these will be considered – for example, paren�ng classes. As services are planned and delivered, The People Concern staff will take into account the resources that are available in the larger community and assist tenants in re-integra�ng back in the community. Tenants will be informed about, and encouraged to par�cipate in, community events and services that are offered locally, in nearby recrea�onal centers, parks, libraries, schools, colleges, health centers and community centers. No�ces concerning special events in the neighborhood will be posted in prominent places on community bulle�n boards so tenants can inform themselves and take advantage of local opportuni�es. At the �me of move in, tenants will be made aware of what services, businesses, or ac�vi�es are available in their new community.

Measuring Outcomes
The People Concern will use an informa�on systems as required by funders, including an HMIS database to track tenant service and engagement, as well as to evaluate and measure outcomes data. Service systems to be tracked in HMIS include physical health, mental health, substance use, legal, educa�on, employment, on-site social/recrea�onal, and case management. Case managers will have read and write access to the system to document services provided and access client history. Project managers and directors across TPC access the system to monitor data quality and accuracy. The Director of Compliance and Evalua�on provides an addi�onal level of monitoring, technical assistance, and training to ensure data quality and the mee�ng of outputs and outcomes.

The tracking data will include frequency and �ming of service. The data will be collected from referring service providers, and recorded, compiled and analyzed by The People Concern staff in order to monitor tenant progress toward their goals. Service u�liza�on data of the tenants will be mapped against desired outcomes to determine progress and make mid-course changes in services as needed. Service u�liza�on data may be shared (while respec�ng tenants’ anonymity and confiden�ality) with appropriate external researchers in connec�on with ongoing efforts to measure the cost-effec�veness of suppor�ve housing.

Green Educa�on
Property management staff and the Resident Services Coordinator (RSC) will host events for all residents to inform them of the building’s green features, the importance of resource conserva�on, and to help them save money and support environmental sustainability. Topics include green cleaning products, recycling, healthy meals, healthy living choices, and u�li�es use. These events will include workshops with hands-on demonstra�ons related to these topics. The RSC will engage with residents regularly on these topics. They will also explore rela�onships with local environmental organiza�ons. Residents will have easy access to recycling. Residents with special needs may request a training that meets their individualized needs.

Exhibits:
4-Step Reten�on Procedures
Case Manager Job Descrip�on
Clinical Case Manager Job Descrip�on
Program Manager/Supervisor Job Descrip�on

11.A.k
Packet Pg. 1461 Attachment: K. Original HCHC Proposal (6695 : Wilshire DDA) The 4-Step Housing Retention Procedure’s main goal is to concretize a path to client housing retention success by operationalizing collaborative standards for frequent communication with clients that promotes clear and specific expectations related to presenting problems and subsequent responses. “Clear is kind, unclear is unkind.” – Brené Brown!

1. Assume positive intent and flex your diplomacy and relationship building muscles. Continuously working to gain and keep Property Management staff’s buy-in is important. a. No one likes to feel bad at their job (late on deadlines, receiving negative feedback, reporting bad outcomes to their agency or partners). What can we do to support Property Managers? Generally overcommunicate, honor times for recurring meeting, schedule appointments, send reminders, plan and prepare for difficult conversations, send follow-up emails, offer regular updates without prompting. b. No one enjoys witnessing ongoing suffering – our Property Managers bring emotion and life experience to that table as well and need our support in delivering undesirable, yet necessary consequences.

2. Over-communicate about roles, expectations, plans for collaboration, action steps, and updates. a. Designated ICMS staff should dedicate time to organizing the tracking of 4-Step Retention procedures, ensure mutual understanding of next steps / actions, and support follow-up communications. b. Before a plan is started, ICMS should work to identify issues, potential causes, past barriers, and possible solutions within the team first to prepare for the discussion with Property Management so that we can comprehensively advocate for a realistic, fair, client-centered plan that improves the probably of clients’ success in following through with the plan.
c. Property Management and ICMS staff should meet to discuss a plan, agree on a plan, and ensure mutual understanding of actions steps prior to proposing timelines and dates to clients. d. It is not the role of ICMS to give lease violations, but we can support the Property Manager in communication with clients and support the clients’ understanding of the process.

3. Always complete steps with property management staff. a. Delivery of verbal or written warnings are completed in partnership with property management to support the communication and mutual understanding of the identified issue, the consequence, the expected change, and the timeline for expected change.
b. If collaborative visits are not feasible, continue to send follow-up emails to all parties involved summarizing the completion of Step 1-2-3-4 conversations with clients.

December 2019
Things to Keep in Mind When
Executing 4-Step Retention Procedures:

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Santa Monica City CouncilDecember 17, 2024

Santa Monica City Council
December 17, 2024