SR-6-D (30)
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Council Meeting: 1/28/92
CDD:Housing:BS:CE:can:nrdcstaf . ~ 19Q1
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Santa Monica, California
TO: Mayor and City Council
FROM: City staff
SUBJECT: Recommendation to Authorize Additional Funding For
Neighborhood Resource and Development Corporation
INTRODUCTION
This report presents background information on the Neighborhood
Resource and Development Corporation and recommends that the City
Council approve an increase of $14,106 in their federally funded FY
91-92 Community Development Block Grant Contract with the city.
The additional funds are required to offset a significant,
unexpected rent increase by the organization's landlord, Lowe
Development Corp.
BACKGROUND
Neighborhood Resource and Development corporation (NRDC) is a
nonprofit, community development corporation that provides
rehabilitation and other neighborhood development services to the
Pico neighborhood of Santa Monica. The city of Santa Monica,
through its Community Development Block Grant funding process has
contracted with NRDC for the past eight years to provide
rehabilitation and home improvement services at no or low cost to
low income Santa Monica residents. Under the terms of this
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contract NRDc will provide at least 75 home improvement grants and
at least 10 mid-level rehabilitation grants in the pico
Neighborhood this fiscal year.
DISCUSSION
NRDC is located at 2140 Colorado Avenue in Santa Monica, where the
organization rents office and warehouse space from the Lowe's
Development Corporation. For some time, Lowe's Development
Corporation has been providing the space virtually rent free as a
public service to the local community. However, in June, 1991,
Lowe's informed NRDc that they would be forced to raise the rent by
$1,500 per month beginning August 1, 1991. This notification came
too late to be included in NRDC's FY 91-92 contract and NRDc has
requested a contract modification to increase its funding by
$14,106 to assist it to pay the increased rent.
The staff believes that the increased rent is competitive with or
below local market rate rents. Given the significant space
requirements of a contractor firm such as NRDC, it is difficult to
expect that they could find another landlord to provide free
warehouse and office rent. Staff has reviewed the NRDC budget and
does not believe that substantial savings to offset this rent
increase could be obtained at this time. staff therefore
recommends that the City council approve the contract modification
and increase the organization's funding by $14,106 to pay the
increased rent. The additional funds will be provided from a
contingency setaside of federal community Development Block Grant
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funds and will not impact the General Fund.
FINANCIAL/BUDGETARY IMPACT
The increased funds will be provided from unallocated federal
community Development Block Grant funds awarded by HUD to the city
for Fiscal Year 91-92. No city General Funds would be utilized.
These contingency funds are held in account # 01-200-262-75560-
7910-15774. Funds should be transfered from this account to the
NRDC account # 01-200-264-77130-7210-15713.
RECOMMENDATION
Staff recommends that the City Council approve the contract
modification, increase the funding of the NRDC for FY 91-92 by
$14,106 to pay increased rent and authorize the City Manager to
execute all documents necessary to evidence this action.
Prepared by: Barbara Stinchfield, Acting Director
Chuck Elsesser, Housing Program Manager
Community Development Department
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BS:CE:can:sb593
Santa Monica, California
Council Meeting: January 28, 1992
To: Mayor and City Council
From: City staff
Subject: Recommendation to Endorse SB 593, the California Housing
Bond Act of 1992
INTRODUCTION
This report recommends that City Council endorse the passage of SB
593 (Roberti), the California Housing Bond Act of 1992. SB 593, if
passed by the Legislature and signed by the governor, would place
on the June 2, 1992 ballot an initiative authorizing a $450 million
general obligation bond issue to provide additional funds for
construction and rehabilitation of affordable housing, homeless
emergency services and first time home buyers' assistance.
BACKGROUND
Prior to 1988, California provided little state assistance for
affordable housing. However, with the passage of Propositions 77
and 84 in 1988 and Proposition 104 in 1990, California voters have
provided over $600 million for low interest loans for construction
and rehabilitation of decent, safe, affordable housing. These
funds, leveraged with federal Low Income Housing Tax Credits and
local funds, helped fuel a significant increase in the production
of affordable housing throughout California. However, there has
been an overwhelming demand for these bond funds and they have been
largely depleted. A Notice of Funding Availability to be issued
this January for the Rental Housing Construction Program will
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utilize the remainder of the new construction funds provided by
those bond measures. The state rehabilitation funds provided by
those bonds have already been fully committed.
DISCUSSION
THE CALIFORNIA HOUSING BOND ACT OF 1992
SB 593, if passed by the Legislature and signed by the Governor,
would place on the June 2, 1992 ballot an additional $450 million
general obligation bond issue to provide financing for a variety of
housing programs. Specifically, it would provide $175 million for
construction of new affordable housing for the elderly, the
disabled, working families and others. It would provide an
additional $175 million for acquisition and rehabilitation of over
5,000 substandard rental units. An additional $40 million is set
aside for first time home buyers' assistance and $20 million is
provided for the rehabilitation of homeless shelters. The funds
will be provided through the same programs as were utilized to
distribute the prior bond funds. Virtually all City-assisted
affordable housing presently being developed in Santa Monica is
also assisted through one of the State bond programs. It is
anticipated that over 50,000 families, homeless people and others
would benefit from the new program funds.
SB 593 has passed the Senate and is currently pending in the
Assembly Housing and Community Development Committee. The
Legislature and the Governor must reach agreement by February on
whether to include housing funding in the package of bond bills to
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be included on the June ballot. It is important tha t the city
council endorse the measure so that it is considered a priority by
the Governor and the Legislature.
FINANCIAL/BUDGETARY IMPACT
This endorsement will have no fiscal or budgetary impact on the
City.
RECOMMENDATION
Staff recommends that city council endorse the passage of SB 593,
the California Housing Bond Act of 1992 and authorize the Mayor to
write a letter to appropriate elected officials to communicate the
Council's endorsement.
Prepared by: Barbara stinchfield, Acting Director
Chuck Elsesser, Housing Program Manager
Community Development Department
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