Item Number: 17
City Council / Board of Directors
Consent Calendar
Meeting of: August 18, 2026
Submitted By:
Tony Camargo, Deputy City Manager
Subject:
Approval of a Substitution of Trustee, Deed of Reconveyance and Cancellation of Covenants, Conditions and Restrictions (CC&Rs) for Residential Rehabilitation Program (RRP) Case Number 22-11-28 (15688 Tokay Street, Victorville, CA 92395), and Acceptance and Reallocation of Associated Program Income Funds Recommendation:
That City Council take the following actions regarding Residential Rehabilitation Program (RRP) Case No. 22-11-28:
(1) Approve the Substitution of Trustee and Deed of Reconveyance; (2) Confirm the Cancellation of the original Covenants, Conditions and Restrictions (CC&Rs);
(3) Authorize the Deputy City Manager to execute the Substitution of Trustee and Deed of Reconveyance and Cancellation of the original CC&Rs; (4) Accept the loan payoff in the amount of $16,633.12 into the Residential Rehabilitation Program Income Account; and
(5) Adopt Resolution No. 26-078 amending the Fiscal Year 2026-2027 Annual Budget to appropriate and reallocate $16,633.12 in Residential Rehabilitation Program Income to the Residential Rehabilitation Program.
Fiscal Impact:
Approval of the recommended actions will authorize the acceptance and reallocation of $16,633.12 in Residential Rehabilitation Program (RRP) Program Income as follows:
Account Adjustment Amount
2853025-47520-20733 - Residential Rehabilitation
Program (Revenue) ($16,633.12)
2853025-52300-20733
Residential Rehabilitation Program (Expenditure) $16,633.12 4 8
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In accordance with U.S. Department of Housing and Urban Development (HUD) regulations, program income must generally be expended before annual Community Development Block Grant (CDBG) entitlement funds are drawn. Reallocating these program income funds into the current Fiscal Year 2026-2027 budget will enable the City to continue providing rehabilitation assistance to eligible residents. The RRP currently maintains a waiting list of more than 124 households, and these additional funds will help address that demand while supporting the activities identified in the City’s Annual Action Plan.
Strategic Plan Goal:
This item aligns with Goal A. Financial Sustainability by maximizing the use of program income generated through the RRP, allowing additional housing assistance without impacting the General Fund, and Goal C. Community and Economic Development by supporting the preservation and improvement of the City’s existing housing stock by providing continued funding for residential rehabilitation projects that improve neighborhood conditions and quality of life.
Background:
The RRP assists eligible homeowners by providing deferred-payment loans funded through the CDBG Program. The program is intended to preserve the City’s housing stock by correcting health and safety deficiencies, addressing building code violations, improving property conditions and enhancing neighborhood appearance.
Eligible homeowners may receive loans ranging from $1,000 to $20,000 at a simple interest rate of three percent (3%). Loans are secured by a Promissory Note, Deed of Trust, and Covenants, Conditions and Restrictions (CC&Rs). If the homeowner elects to repay the loan before the end of the affordability period, the City may reconvey the Deed of Trust and release the CC&Rs upon satisfaction of the loan obligations in accordance with the loan documents.
Discussion:
On November 28, 2022, the Participant received a RRP loan in the amount of $14,601 to rehabilitate the residence located at 15688 Tokay Street, Victorville, California.
Improvements completed through the program included painting the home’s facia, replacing the front door, replacing water-damaged kitchen cabinetry, repairing plumbing blockages, repairing the electrical panel, repairing attic ductwork, recaulking the master and guest bathroom tubs, repairing seven interior doors, repairing drywall and painting the hallway bathroom.
On July 6, 2026, the Participant elected to repay the loan in full prior to the expiration of the loan term. Pursuant to the terms of the Promissory Note, the payoff consisted of the original principal balance of $14,601, accrued simple interest totaling $1,752.12, and a $280 service fee/activity delivery cost, for a total payoff amount of $16,633.12.
As the Participant has fully satisfied the financial obligations of the loan, the City has received a request to reconvey the Deed of Trust and cancel the CC&Rs in accordance 4 8
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with the loan documents. Approval of the recommended actions will authorize the execution and recordation of the Substitution of Trustee and Deed of Reconveyance and Cancellation of the CC&Rs, thereby releasing the encumbrances recorded against the property.
The loan payoff will also generate $16,633.12 in Program Income. Consistent with HUD regulations, staff recommends adopting Resolution No. 26-078, amending the Fiscal Year 2026-2027 Annual Budget to appropriate and reallocate $16,633.12 in Residential Rehabilitation Program Income to the Residential Rehabilitation Program budget so they may be used to assist additional eligible homeowners currently awaiting assistance.
Prepared By:
Lisa Perea, Housing Technician
Attachments: A. Resolution No. 26-078
B. Substitution of Trustee and Full Reconveyance
C. Cancellation and Release of CC&Rs
D. Original Promissory Note, Deed of Trust, CC&Rs and Notice of Affordability Restrictions