Title
(CONTINUED FROM MAY 31 AND JUNE 21, 2017) - HUD Rental Assistance Demonstration Rehabilitation of Foothills Village Public Housing Community (Ordinance S-43579)
Description
Request authorization for the City Manager, or his designee, to implement the rehabilitation of the Foothills Village Public Housing community through the U.S. Department of Housing and Urban Development's (HUD) Rental Assistance Demonstration (RAD) Program, with the Housing Department serving as co-developer. Authorization is also requested for the City Controller to disburse Public Housing and/or Affordable Housing funds for the project.
Report
Summary
Foothills Village, located at 920 W. Alta Vista Road and built in 1971, consists of 32 buildings containing 200 units with two to four bedrooms. The property, which sits on approximately 17.85 acres, contains outdated units and resident amenities. In February 2017, HUD awarded a RAD Program commitment for Foothills Village, allowing the Housing Department to convert the property's 200 Public Housing units from a Public Housing operating subsidy to a long-term, renewable, project-based Section 8 contract. The RAD Program will help revitalize aging Public Housing properties and address the backlog of deferred maintenance and capital improvements, as well as provide future financial sustainability and continued affordability. It is anticipated that the new development will contain 190 RAD units and 10 unsubsidized units.
The Housing Department is procuring a co-development partner to rehabilitate the Foothills Village site including its on-site resident amenity buildings (the Project). A separate request will seek City Council approval for contract award of the selected co-developer.
The Housing Department, working with its co-development partner once selected, seeks authorization to proceed with all actions necessary or appropriate to rehabilitate the Foothills Village Apartments site including the following:
1. Pursue substantial rehabilitation of existing buildings on the site and relocate resident households per RAD requirements.
2. Form a new City-controlled non-profit corporation with the Housing Director to serve as sole incorporator, with names and governance documents as approved by the City Manager or his designee.
3. Jointly with the co-developer, form a new corporate entity or entities, of which the corporation will be a member and co-developer for the Project, to serve as the ownership entity(ies) for the site.
4. Procure and/or engage in funding transactions to finance the rehabilitation, including submitting applications and accepting awards of Low Income Housing Tax Credits (LIHTC), seeking a LIHTC equity investor, and obtaining other grants and/or loans for the Project.
5. Provide financial guarantees to investors or lenders to assure rehabilitation completion and loan repayment if necessary to obtain financing, provided that any guaranty may only be paid from any developer fees to be paid to the new corporation.
6. Appropriate and expend up to $4 million in Housing Department Public Housing and/or Affordable Housing Funds to provide and/or loan predevelopment and gap funding.
7. Allocate Section 8 Project-Based Vouchers and/or Public Housing units, amend HUD Annual Plan(s), and enter into associated contracts or agreements, as necessary to facilitate financing, rehabilitation, and operations.
8. Convey or grant fee title or a lesser interest in all or any portion of the site to the Corporation(s), LLC(s), public utilities, and other third parties as necessary to facilitate rehabilitation.
9. Procure, execute, and submit or deliver all contracts, documents and instruments necessary for the rehabilitation and operation of the property.
10. Use and expend the proceeds of any grants, loans, and other financing and funding sources to carry out the rehabilitation and operation of the property.
11. Take other action necessary or appropriate to rehabilitate, implement, and operate all phases of the Foothills Village RAD Program rehabilitation.
Financial Impact
Funding is available in the Public Housing and/or Affordable Housing Funds.
Location
Foothills Village Public Housing community, 920 W. Alta Vista Road.
Concurrence/Previous Action
This item was considered at the Sustainability, Housing, Efficiency and Neighborhoods Subcommittee on May 16, 2017, and approval recommended by a vote of 4-0.
Department
Responsible Department
This item is submitted by Deputy City Manager Deanna Jonovich and the Housing Department.