Title
Add Federal CDBG Funding for Foothills Village HUD Rental Assistance Demonstration Rehabilitation (Ordinance S-48796)
Description
Request to authorize the City Manager, or his designee, to add up to $4 million in federal Community Development Block Grant (CDBG) funding, and take all necessary actions and execute all documents to amend the loan with FVA, LLC for the rehabilitation of the Foothills Village affordable housing community, which was previously converted through the U.S. Department of Housing and Urban Development (HUD) Rental Assistance Demonstration (RAD) Program from Public Housing to Section 8 rental assistance. Further request to authorize the City Controller to disburse all funds related to this item. There is no impact to the General Fund.
Report
Summary
On July 6, 2017, the City Council approved the implementation and rehabilitation of Foothills Village through the HUD RAD Program. Foothills Village is located at 920 W. Alta Vista Rd. and consists of 200 units with one to four bedrooms. The property, which sits on approximately 17.85 acres, is currently under construction to renovate outdated units, replace major systems, and upgrade resident amenities. The Housing Department and its partner, Gorman and Company, serve as co-developers. FVA, LLC is the ownership entity for the project. 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 helps 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.
CDBG funds are being requested to address added scope items benefiting the residents of the Foothills Village community as well as to address construction cost increases due to pricing increases in the market and unforeseen conditions. All 200 units serve households with incomes at or below 60 percent of Area Median Income (AMI) with 120 of those units serving households at or below 50 percent AMI. With the additional funding, the total development budget will be $32,951,895. Other funding for this project includes Low Income Housing Tax Credit (LIHTC) equity, private mortgage, seller carryback note, deferred developer fee, City loan of federal Public Housing funding, and a loan from the Phoenix Community Development and Investment Corporation.
Financial Impact
Funding is available in the Neighborhood Services Department's HUD CDBG program. There is no impact to the General Fund.
Concurrence/Previous Council Action
Original project implementation authority was granted on July 6, 2017, by City Council through Ordinance S-43579.
Location
920 W. Alta Vista Rd.
Council District: 7
Department
Responsible Department
This item is submitted by Deputy City Managers Gina Montes and Alan Stephenson and the Housing and Neighborhood Services departments.