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Home My WebLink About2016-02-22 - AGENDA REPORTS - HOUSING SUCCESSOR REPORT 2014-15 (2)0 Agenda Item: 1 CITY OF SANTA CLARITA OVERSIGHT BOARD TO THE FORMER REDEVELOPMENT AGENCY OF THE CITY OF SANTA CLARITA AGENDA REPORT NEW BUSINESS APPROVAL: DATE: February 22, 2016 SUBJECT: HOUSING SUCCESSOR REPORT FOR 2014-2015 DEPARTMENT: Community Development PRESENTER: Erin Lay RECOMMENDED ACTION Receive the Housing Successor Annual Report regarding the Low and Moderate Income Housing Asset Fund. BACKGROUND In 2011, the Governor signed AB 1X26, dissolving Redevelopment Agencies in the State of California Since that time, a variety of subsequent legislation has been adopted governing the wind -down process for former Redevelopment Agencies. The City of Santa Clarita opted to become the Housing Successor to the former Redevelopment Agency, with responsibility for the existing housing bond proceeds and housing assets (known collectively as the Low and Moderate Income Housing Asset Fund or LMIHAF), and for carrying out housing activities. The City Council is the governing entity for the LMIHAF and Housing Successor activities. Senate Bill 341 and Assembly Bill 1793 set forth, among other things, requirements for the Housing Successor to report to the State of California on the status of the LMIHAF annually. In addition, per Section 3 of the Agreement Regarding the Expenditure of Housing Bond Proceeds, which was adopted by the Oversight Board on September 6, 2013, the Housing Successor will report to the Oversight Board annually on the use of the LMIHAF. Per these requirements, the Housing Successor Annual Report (Report) for Fiscal Year 2014-2015 is attached for your review. The Report will be provided to the City Council, submitted to the State of California, and posted on the City's website. Page 1 Packet Pg. 6 ALTERNATIVE ACTION Other action as directed by the Oversight Board. FISCAL IMPACT This item has no fiscal impact beyond reporting what activities have been accomplished. ATTACHMENTS 2014-2015 Housing Successor Report 0 Page 2 Packet Pg. 7 1.a HOUSING SUCCESSOR ANNUAL REPORT REGARDING THE LOW AND MODERATE INCOME HOUSING ASSET FUND FOR FISCAL YEAR 2014-2015 PURSUANT TO CALIFORNIA HEALTH AND SAFETY CODE SECTION 34176.1(f) FOR THE CITY OF SANTA CLARITA HOUSING SUCCESSOR This Housing Successor Annual Report (Report) regarding the Low and Moderate Income Housing Asset Fund (LMIHAF) has been prepared pursuant to California Health and Safety Code Section 34176.1(f) and is dated as of April 15, 2015. This Report sets forth certain details of the City of Santa Clarita (Housing Successor) activities during Fiscal Year 2014-2015 (Fiscal Year). The purpose of this Report is to provide the governing body of the Housing Successor an annual report on the housing assets and activities of the Housing Successor under Part 1.85, Division 24 of the California Health and Safety Code, in particular sections 34176 and 34176.1 (Dissolution Law). The following Report is based upon information prepared by Housing Successor staff and information regarding the Low and Moderate Income Housing Asset Fund contained within the City of Santa Clarita's independent annual financial audit for Fiscal Year 2014-2015 as prepared by RSM US LLP (Audit), which Audit is separate from this annual summary Report; further, this Report conforms with and is organized into sections I. through XI., inclusive, pursuant to Section 34176.1(f) of the Dissolution Law: I. Amount Deposited into LMIHAF: This section provides the total amount of funds deposited into the LMIHAF during the Fiscal Year. Any amounts deposited for items listed on the Recognized Obligation Payment Schedule (ROPS) must be distinguished from the other amounts deposited. II. Ending Balance of LMIHAF: This section provides a statement of the balance in the LMIHAF as of the close of the Fiscal Year. Any amounts deposited for items listed on the ROPS must be distinguished from the other amounts deposited. III. Description of Expenditures from LMIHAF: This section provides a description of the expenditures made from the LMIHAF during the Fiscal Year. The expenditures are to be categorized. IV. Statutory Value of Assets Owned by Housing Successor: This section provides the statutory value of real property owned by the Housing Successor, the value of loans and grants receivables, and the sum of these two amounts. City of Santa ClaritaPacket Pg. 8 1.a V. Description of Transfers: This section describes transfers, if any, to another housing successor agency made in previous Fiscal Year(s), including whether the funds are unencumbered and the status of projects, if any, for which the transferred LMIHAF will be used. The sole purpose of the transfers must be for the development of transit priority projects, permanent supportive housing, housing for agricultural employees or special needs housing. VI. Project Descriptions: This section describes any project for which the Housing Successor receives or holds property tax revenue pursuant to the ROPS and the status of that project. VII. Status of Compliance with Section 33334.16: This section provides a status update on compliance with Section 33334.16 for interests in real property acquired by the former redevelopment agency prior to February 1, 2012. For interests in real property acquired on or after February 1, 2012, provide a status update on the project. VIII. Description of Outstanding Obligations under Section 33413: This section describes the outstanding inclusionary and replacement housing obligations, if any, under Section 33413 that remained outstanding prior to dissolution of the former redevelopment agency as of February 1, 2012 along with the Housing Successor's progress in meeting those prior obligations, if any, of the former redevelopment agency and how the Housing Successor's plans to meet unmet obligations, if any. IX. Income Test: This section provides the information required by Section 34176.1(a)(3)(B), or a description of expenditures by income restriction for five year period, with the time period beginning January 1, 2014 and whether the statutory thresholds have been met. However, reporting of the Income Test is not required until 2019. X. Senior Housing Test: This section provides the percentage of units of deed -restricted rental housing restricted to seniors and assisted individually or jointly by the Housing Successor, its former redevelopment Agency, and its host jurisdiction within the previous 10 years in relation to the aggregate number of units of deed -restricted rental housing assisted individually or jointly by the Housing Successor, its former Redevelopment Agency and its host jurisdiction within the same time period. For this Report the ten-year period reviewed is July 1, 2007 to June 30, 2017. XI. Excess Surplus Test: This section provides the amount of excess surplus in the LMIHAF, if any, and the length of time that the Housing Successor has had excess surplus, and the Housing Successor's plan for eliminating the excess surplus. City of Santa Clarita IPacket Pg. 9 1.a This Report is to be provided to the Housing Successor's governing body. In addition, this Report and the former redevelopment agency's pre -dissolution Implementation Plans are to be made available to the public on the City's website at www.santa-clarita.com. I. AMOUNT DEPOSITED INTO LMIHAF A total of $241,791 was in housing bond proceeds were deposited into the LMIHAF as of January 1, 2014. No other deposits were made during the fiscal year. II. ENDING BALANCE OF LMIHAF At the close of the Fiscal Year, the ending balance in the LMIHAF was $4,082,096 III. DESCRIPTION OF EXPENDITURES FROM LMIHAF The "Redevelopment Block" identified in Section VII of this report (identified at the "City Block" in previous reports) was acquired in part using funds from the LMIHF. In 2014-2015, $66,000 from the LMIHAF was used for demolition costs on the Redevelopment Block. Also in 2014-2015, $100,000 was paid to Newhall Avenue Housing Partners as the first payment on predevelopment costs as required by the Disposition and Development Agreement (DDA) for the Newhall Avenue Apartments, a 30 -unit multi -family affordable housing development. The following is a description of expenditures from the LMIHAF by category: IV. STATUTORY VALUE OF ASSETS OWNED BY HOUSING SUCCESSOR IN LMIHAF Under the Dissolution Law and for purposes of this Report, the "statutory value of real property" means the value of properties formerly held by the former redevelopment agency as listed on the housing asset transfer schedule approved by the Department of Finance as listed in such schedule under Section 34176(a)(2), the value of the properties transferred to the Housing Successor pursuant to Section 34181(0, and the purchase price of property(ies) purchased by the Housing Successor. Further, the value of loans and grants receivable is included in these reported assets held in the LMIHAF. City of Santa Clarita I Packet Pg. 10 Monitoring & Administration Expenditures $0 Homeless Prevention and Rapid Rehousing $0 Services Expenditures Housing Development Expenditures $166,000 ➢ Expenditures on Low Income Units ➢ Expenditures on Very -Low Income Units ➢ Expenditures on Extremely -Low Income Units ➢ Total Housing Development Expenditures Total LMIHAF Expenditures in Fiscal Year $166,000 IV. STATUTORY VALUE OF ASSETS OWNED BY HOUSING SUCCESSOR IN LMIHAF Under the Dissolution Law and for purposes of this Report, the "statutory value of real property" means the value of properties formerly held by the former redevelopment agency as listed on the housing asset transfer schedule approved by the Department of Finance as listed in such schedule under Section 34176(a)(2), the value of the properties transferred to the Housing Successor pursuant to Section 34181(0, and the purchase price of property(ies) purchased by the Housing Successor. Further, the value of loans and grants receivable is included in these reported assets held in the LMIHAF. City of Santa Clarita I Packet Pg. 10 The following provides the statutory value of assets owned by the Housing Successor. V. DESCRIPTION OF TRANSFERS The Housing Successor did not make any LMIHAF transfers to other Housing Successor(s) under Section 34176.1(c)(2) during the Fiscal Year. VI. PROJECT DESCRIPTIONS The Housing Successor does not receive or hold property tax revenue pursuant to the ROPS. VII. STATUS OF COMPLIANCE WITH SECTION 33334.16 Section 34176.1 provides that Section 33334.16 does not apply to interests in real property acquired by the Housing Successor on or after February 1, 2012; however, this Report presents a status update on the project related to such real property. With respect to interests in real property acquired by the former redevelopment agency priorto February 1, 2012, the time periods described in Section 33334.16 shall be deemed to have commenced on the date that the Department of Finance approved the property as a housing asset in the LMIHAF; thus, as to real property acquired by the former redevelopment agency now held by the Housing Successor in the LMIHAF, the Housing Successor must initiate activities consistent with the development of the real property for the purpose for which it was acquired within five years of the date the DOF approved such property as a housing asset. The following provides a status update on the real property or properties housing asset(s) that were acquired prior to February 1, 2012 and compliance with five-year period: 23652 Newhall Avenue, Santa Clarita, CA 91321 (Jang Parcel) APN 2833-016-901 8/31/2012 8/31/2017 As of 6/30/2014 the Housing Successor is investigating options for development of this parcel for a use allowed in H&S Code 34176.1. 1.a City of Santa Clarita I Packet Pg. 11 1.a Block of vacant land 8/31/2012 bounded by Main St. and Railroad Ave., and by 9t" St. and Lyons Ave. (Redevelopment Block) APN's 2831-007-900, -901, -902, -903, -904, -905, -906, -907, -908. 8/31/2017 In 2014-2015, a Request for Qualifications was released for development of this property. Proposals were reviewed and further negotiations were in progress as of June 30, 2015. The following provides a status update on the project(s) for property or properties that have been acquired by the Housing Successor using LMIHAF on or after February 1, 2012: 23610 Newhall 1/31/2014 1/31/2019 As of 6/30/2014 the Housing Avenue, Santa Successor had finalized a DDA for Clarita, CA 91321 the development of this of this parcel (Caltrans Parcel) for a 30 -unit multi -family affordable APN 2833-016-900 housing development. VIII. DESCRIPTION OF OUTSTANDING OBLIGATIONS PURSUANT TO SECTION 33413 Replacement Housing: According to the 2007 Implementation Plan for the former redevelopment agency, no Section 33413(a) replacement housing obligations were transferred to the Housing Successor. The former redevelopment agency's Implementation Plans are posted on the City's website at http://www.santa-clarita.com/index.aspx?page=328. Inclusionary/Production Housing. According to the 2007 Implementation Plan for the former redevelopment agency, no Section 33413(b) inclusionary/production housing obligations were transferred to the Housing Successor. The former redevelopment agency's Implementation Plans are posted on the City's website at http://www.santa-clarita.com/index.aspx?page=328. IX. EXTREMELY -LOW INCOME TEST Section 34176.1(a)(3)(B) requires that the Housing Successor must require at least 30% of the LMIHAF to be expended for development of rental housing affordable to and occupied by households earning 30% or less of the AMI. If the Housing Successor fails to comply with the Extremely -Low Income requirement in any five-year report, then the Housing Successor must ensure that at least 50% of the funds remaining in the LMIHAF be expended in each fiscal year following the latest fiscal year following the report on households earning 30% or less of the AMI City of Santa Clarita I Packet Pg. 12 N N N _l 1.a until the Housing Successor demonstrates compliance with the Extremely -Low Income requirement. This information is not required to be reported until 2019 for the 2014 — 2019 period. X. SENIOR HOUSING TEST The Housing Successor is to calculate the percentage of units of deed -restricted rental housing restricted to seniors and assisted by the Housing Successor, the former redevelopment agency and/or the City within the previous 10 years in relation to the aggregate number of units of deed -restricted rental housing assisted by the Housing Successor, the former redevelopment agency and/or City within the same time period. If this percentage exceeds 50%, then the Housing Successor cannot expend future funds in the LMIHAF to assist additional senior housing units until the Housing Successor or City assists and construction has commenced on a number of restricted rental units that is equal to 50% of the total amount of deed -restricted rental units. The following provides the Housing Successor's Senior Housing Test for the 10 year period of July 1, 2007 to June 30, 2017: XI. EXCESS SURPLUS TEST Excess Surplus is defined in Section 34176.1(d) as an unencumbered amount in the account that exceeds the greater of one million dollars ($1,000,000) or the aggregate amount deposited into the account during the Housing Successor's preceding four Fiscal Years, whichever is greater. The following provides the Excess Surplus test for the preceding four Fiscal Years: FY 2011/12 FY 2011/12 FY 2013/14 FY 2014/15 Beginning Balance 0 0 0 $4,006,386 Add: Deposits 0 0 $5,056,509 $241,710 (Less) Expenditures 0 0 $1,050,123 $166,000 Ending Balance 0 0 $4,006,386 $4,082,096 The LMIHAF has a $4,082,096 excess surplus. The Housing Successor has three fiscal years to encumber, or transfer, the excess surplus, if any. The Housing Successor has had this City of Santa Clarita I Packet Pg. 13 1.a excess surplus since June 30, 2015, and the following summarizes the Housing Successor's plan for encumbering (or transferring) this excess surplus: The City Council, acting in its capacity as the Housing Successor, approved a Disposition and Development Agreement (DDA) with an affordable housing developer to construct a 30 -unit 100% affordable family housing complex on one of the parcels listed in section VII above (Caltrans parcel). As part of the DDA, the Housing Successor will contribute a grant of $3.8 million dollars from the LMIHAF and will sell the parcel to the developer for $1. The transfer of the initial $100,000 was completed in 2014-2015 and is reflected in this report. The balance of $3.7 million is expected to be completed in 2015-2016. This timeline will meet the three fiscal year limit to encumber or transfer the excess surplus. N N N r il City of Santa Clarita I Packet Pg. 14