Item Number: 2
City Council / Board of Directors
Consent Calendar
Meeting of: September 2, 2025
Submitted By:
Alex Jauregui, City Planner
Subject:
Substitution of Trustee and Deed of Reconveyance, and Cancellation and Release of Covenants, Conditions and Restrictions for Residential Compliance Program Case No. 17-09-13 (15660 Yates Rd., Victorville, CA 92395); as well as acceptance and reallocation of associated Program Income Funds
Recommendation:
That Honorable City Council take the following actions regarding Residential Compliance Program Case No. 17-09-13:
(1) Approve the Substitution of Trustee and Deed of Reconveyance; (2) Confirm the required Cancellation and Release of the original Covenants, Conditions and Restrictions;
(3) Authorize the execution of the Substitution of Trustee and Deed of Reconveyance as well as the Cancellation and Release of the original Covenants, Conditions and Restrictions by the Deputy City Manager;
(4) Accept the payoff of the loan receivable to the Residential Rehabilitation Program Income Account; and
(5) Adopt Resolution No. 25-060, amending the annual budget for fiscal year 2025- 2026 by reallocating the subject $3,700 Residential Rehabilitation Program Income funds to the Residential Rehabilitation Program.
Fiscal Impact:
Approval of the item will allow for the acceptance and reallocation of $3,700 in program income from the Residential Compliance Program (RCP), which will be used to benefit a participant in the Residential Rehabilitation Program (RRP) in accordance with the City's adopted Annual Action Plan. This proposal would cause the following revenue and expenditure budget accounts to be updated to reflect the acceptance and reallocation of the subject $3,700 to the appropriate RRP accounts.
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Budget Accounts:
Account Amount Adjusted
2853025-47520-20733 - Residential Rehabilitation Program Income (Revenue)
$3,700
2853025-52300-20733 - Residential Rehabilitation Program Income (Expenditure)
$3,700
Per the Department of Housing and Urban Development (HUD) rules, program income must be spent before yearly Community Development Block Grant (CDBG) allocations can be spent. Therefore, this reallocation request of $3,700 in RRP Program into the current Fiscal Year (FY) 2025-2026 budget will benefit additional RRP participants, as outlined in the 2025-2026 Annual Action Plan. The RRP maintains a waiting list of over 130 residents, which would utilize over a year's worth of future funding dedicated to this program. Due to the popularity of the program and an expanding wait list, approval of this request to reallocate the subject program income will allow the City to assist a greater number of residents in accordance with the adopted 2022-2026 Consolidated Plan and the 2025-2026 Annual Action Plan.
Strategic Plan Goal:
Approval of this acceptance and reallocation of RRP program income will enable the City to further fulfill the following Goals outlined in the 2023-2026 Strategic Plan:
• Goal A (Financial Sustainability) – Reallocating program income from a completed Residential Compliance Program project provides funds to assist additional residents of the City of Victorville while utilizing a revenue opportunity that does not impact the General Fund.
• Goal C (Community and Economic Development) – Utilizing available funds for ongoing projects such as the RRP helps to maintain the City’s existing housing stock, thereby supporting the preservation of the community.
Background:
The Residential Compliance Program (RCP) was designed to promote local beautification, increase property values, boost curb appeal, and correct any Health and Safety Code, Building Code, or Victorville Municipal Code violations. In FY 2019-2020, the RCP program was merged with the Residential Curb Appeal Program to create the successor Residential Rehabilitation Program (RRP). Funded through the Community Development Block Grant (CDBG), the RRP offers deferred payment loans ranging from $1,000 to $20,000 at a 3% interest rate. Loans provided are secured against the property for the term of ten (10) years. The loan can be forgiven should participants remain as the property owner and occupy the dwelling as their principal residence for no less than the program's 10-year term. After 5 years, half of the loan principal and interest may be forgiven should participants remain the property owner and occupy the dwelling as their principal residence.
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Discussion:
On September 13, 2017, the Residential Compliance Program (RCP) Participant (the "Participant") received a loan in the amount of $6,900 to aid in the rehabilitation of the home at 15660 Yates Rd., Victorville, CA 92395. Required rehabilitation included:
removal of dilapidated plants and weeds, new desert landscape, wood borders, new sprinkler valves, a new sprinkler timer, and the repair of an existing wood fence at the front yard. All items were completed using an RCP loan. Subsequently, the Participant requested that the City reconvey the Deed of Trust that secured the RCP loan. This request was made due to the terms of the Promissory Note, Deed of Trust, and Covenants, Conditions and Restrictions (CC&Rs) being satisfied with the repayment of the subject RCP loan funds and associated fees on July 31, 2025.
According to the Promissory Note, the Participant was required to repay half of the original $6,900 RCP loan (amounting to $3,450) based on the portion of the five-year loan term that had elapsed. The repayment included 0% interest and a $250 service fee. The Participant has since paid the principal and service fee balance totaling $3,700.
Since the Participant has satisfied the terms of the Promissory Note, Deed of Trust and CC&Rs (e.g. occupancy requirements, maintenance standards, affordability covenants, etc.), the Participant has requested a release of the encumbrance of the CC&Rs per "Article V" of the original CC&Rs, which also necessitates a Substitution of Trustee and Deed of Reconveyance.
Prepared By:
Lisa Perea, Housing Technician
Attachments: A. Resolution No. 25-060
B. Substitution of Trustee and Deed of Reconveyance
C. Cancellation and Release of CC&Rs
D. Original Promissory Note, Deed of Trust, CC&Rs and Notice of Affordability Restrictions