sr-060810-1cc7®
c;~Yo, City Council Report
Santa Monica"
City Council Meeting: June 8, 2010
Agenda Item: ~ ~C--
To: Mayor and City Council
From: Andy Agle, Director of Housing and Economic Development
Subject: Grant Funding from the State of California BEGIN Program for the
Proposed Affordable Home Ownership Development at 1943 - 1959 High
Place
Recommended Action
Staff recommends that City Council:
1. adopt the attached resolution authorizing the City Manager to apply for
approximately $2,115,000 in State of California (State) Building Equity and
Growth in Neighborhoods (BEGIN) Program Funds from the for the proposed
affordable home ownership development at 1943-1959 High Place; and
2. authorize the City Manager to execute a grant agreement with the State and
submit -all other documents necessary to participate in the BEGIN Program if
funds are awarded.
Executive Summary
The Community Corporation of Santa Monica (CCSM) will develop approximately 45
units for affordable home ownership in the next two to four years at 1943, 1945, 1955,
and 1959 High Place ("High Place East"). The financing for the development is
anticipated as a combination of City housing trust funds, individual homeowner-obtained
financing and State BEGIN Program funds. The State BEGIN Program provides
mortgage assistance funds to cities for eligible developments such as High Place East.
A new funding opportunity has arisen that, if successful, will allow the City to increase
the amount of BEGIN program funds to the High Place East development and thereby
minimize the City contribution of housing trust funds.
Background
On October 25, 2005, the City Council and the Redevelopment Agency (Agency)
approved the proposed concept of an affordable homeownership development at High
Place East to be development by CCSM. Additionally, the City Council adopted a
resolution on Mav 9 2006 authorizing the City Manager to apply for approximately
$1,350,000 in BEGIN Program Funds from the State and enter into a grant agreement
'1
with the State if awarded funds for this development. The City was awarded these
funds in July 2006 and the High Place East development ,received Planning
Commission approval in December 2007. On September 16. 2008 the City Council
approved the vacation of excess public right-of-way along High Place which enhanced
the design features of the High Place East development.
Discussion
Recently the State Department of Housing and Community Development (HCD) issued
a Notice of Funding Availability (NOFA) authorizing higher BEGIN program funding
limits than previously allowed. The previous per-unit funding limit equals the lesser of
$30,000 per unit or 20% of the unit sales price. The new NOFA removed the $30,000
per unit limit and allows applicants to request funding not to exceed 20% of the unit.
sales price. Therefore, submitting an application for funding in response to this new
NOFA creates an opportunity to increase the existing BEGIN Program funding from
$1,350,000 to $2,115,000.
Commission Action
At their May 20, 2010 meeting, the Housing Commission recommended that the City of
Santa Monica apply for BEGIN Program funds from the State to further assist the
proposed High Place East development.
Financial Impacts & Budget Actions
There is no budget impact associated with the submission of an application for BEGIN
program funds. If the City's funding application is successful, revenues would increase
by the anticipated amount of $2,115,000 and this revenue would be offset by the same
amount of financing to the High Place East development.
2
However, any awarded BEGIN funds would not be disbursed from the State to the City
until the High Place East development is complete, which is a few years in the future.
Therefore, specific budget adjustments regarding revenues and expenditures will be
considered subsequent to the City obtaining an award of the new BEGIN funds.
Prepared by: Jim Kemper, Housing Administrator
Andy Agle, Director
Housing and Economic
Attachments:
Forwarded to Council:
Rod Gould
City Manager
Attachment A: Resolution Authorizing the City of Santa Monica to Apply for and
Receive BEGIN Program Funds
3