HomeMy WebLinkAboutR-10047 Allocating $300,000 for Affordable Housing Funds - Laurel Creek Project0 0
Resolution No. 10047 (2008 Series)
A RESOLUTION OF THE COUNCIL OF THE CITY OF SAN LUIS OBISPO
ALLOCATING AN ADDITIONAL $300,000 FOR A TOTAL OF $7009000 OF
AFFORDABLE HOUSING FUNDS FOR DOWN PAYMENT ASSISTANCE
FOR TEN BEGIN UNITS IN THE LAUREL CREEK PROJECT
WHEREAS, the Council of the City of San Luis Obispo adopted Resolution No. 9748
allocating $300,000 from the Affordable Housing Fund for ten BEGIN units in the Laurel Creek
(formerly Tumbling Waters) project; and
WHEREAS, the BEGIN program provides low- interest loans for moderate - income
households to purchase units in the project; and
WHEREAS, the City of San Luis Obispo, Community Development Department,
opened a lottery application period between September 29, 2008, and November 14, 2008, to
identify eligible households to purchase these 10 units and, as of the close of the application
period, only two applications were certified as complete; and
WHEREAS, the City's participation in the BEGIN program leverages a $300,000 State
grant that the City will be able to use to . support other affordable housing projects at the
conclusion of the BEGIN program; and
WHEREAS, the City Council has reviewed the criteria for making awards from the
Affordable Housing Fund and determined that the BEGIN project is consistent with the criteria;
and
NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Luis
Obispo as follows:
Section 1. Affordable Housing Fund. The City Council does hereby approve allocation
of an additional $300,000 of Affordable Housing Funds, for a total of $700,000, to the BEGIN
program at Laurel Creek based on the following findings.
1. Eligibility. Use of the Affordable Housing Fund will increase or improve affordable
housing inventory and promote General Plan policies regarding housing and related
community goals because the project will increase the City's affordable housing inventory by
10 moderate - income units and will promote General Plan policies, among them:
,'Assist with the issuance of bonds, tax credit financing, loan underwriting, or other financial
tools to help develop or preserve affordable units through various programs, including, but
not limited to: (1) below - market financing and (2) subsidized mortgages for very-low, low -
and moderate income persons and first -time home buyers, and (3) self -help or `sweat equity'
homeowner housing." (Housing Element Program 2.3.9)
R 10047
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Resolution No. 10047 (2008 Series)
Page 2
2. Need. There exists a substantial or overarching need for the type of housing to be
assisted because with a median home sales price of well over $600,000 and an affordability
index of 10% (the percentage of households in the City based on income who can afford to
purchase a median-priced home), the need for more affordable housing in San Luis Obispo is
self - evident.
3. Suitability. The project to be assisted is appropriate for its location, both in terms of land
use and design because the site is appropriate for a higher density residential project; in fact,
the City initiated the General Plan Amendment to enable development of the project. Since
adoption of the Housing Element, the Laurel Creek project serves as an example of
"affordable -by- design." The project embodies the concept of higher density and compact
development on an infill site.
4. Timing. The project would better serve the City's needs if it were built immediately as
opposed to later because the need is urgent — affordable housing opportunities should be
taken advantage of quickly. In addition, the State BEGIN grant expires on June 30, 2009 and
any funds not expended by that time will be lost.
5. Financial Effectiveness. AHF funding "leverages" significant additional funding from
other sources. The AHF funds provide significant leverage with State and private funding
sources. This financing package includes City's funding sources, Proposition 46 funding
and a developer contribution filling the gap in financing and allowing provision of 10
additional affordable housing units.
The developer is contributing $100,000 to cover closing costs and buy down interest rates to
make the units more affordable to the purchasers. This is a critical component of the package
to close the financing gap.
6. Readiness. The project is under construction and the units available under the BEGIN
program should be ready for occupancy by the end of January 2009.
Upon motion of Council Member Marx, seconded by Vice Mayor Settle, and on the
following vote:
AYES: Council Members Ashbaugh, Carter and Marx, Vice Mayor Settle and
Mayor Romero
NOES: None
ABSENT: None
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Resolution No. 10047 (2008 Series)
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The foregoing resolution was adopted this 2nd day of December 2008.
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Mayor David F. Romero
ATTEST:
Audrey H oper
City Cle
APPROVED AS TO FORM:
atha .Lowell
City Attorney