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Agenda Item
ASR
Control 21-000872 |
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MEETING DATE: |
12/07/21 |
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legal entity taking action: |
Board of Supervisors |
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board of supervisors
district(s): |
All Districts |
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SUBMITTING
Agency/Department: |
OC Community Resources (Approved) |
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Department contact
person(s): |
Dylan Wright (714) 480-2788 |
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Dr. Clayton Chau (714) 834-2830 |
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Subject: Authorize Submittal of a
Permanent Local Housing Allocation Year 2 Application
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ceo CONCUR |
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Clerk of the Board |
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Concur |
Approved Resolution to Form |
Public Hearing |
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3 Votes Board Majority |
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Budgeted: Yes |
Current Year Cost:
$1,466,797 |
Annual Cost:
FY 21-22 $1,118,994, |
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Staffing Impact: |
No |
# of Positions:
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Sole Source:
N/A |
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Current Fiscal Year Revenue: $2,573,476
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Prior Board Action: 07/14/2020
#19 |
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RECOMMENDED ACTION(S):
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1. |
Conduct a public hearing and consider public comment for the Permanent Local Housing Allocation Program Year 2 Allocation Application and Substantial Amendment to the Permanent Local Housing Allocation Five-Year Plan. |
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2. |
Approve Permanent Local Housing Allocation Program Year 2 Allocation Application and Substantial Amendment to the Permanent Local Housing Allocation Five-Year Plan in the form of Attachment B. |
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3. |
Adopt Resolution in the form of Attachment E authorizing and agreeing to the following: a. The submittal of an application to the State of California Department of Housing and Community Development for Permanent Local Housing Allocation Year 2 Funds; b. The OC Community Resources Director or designee to execute and submit the Permanent Local Housing Allocation Year 2 Application as well as other documents that are related to the Permanent Local Housing Allocation program; c. The receipt of Permanent Local Housing Allocation funds in an amount not to exceed the five-year estimate of the Permanent Local Housing Allocation formula allocation of $7,632,984, and the allocation for the City of San Juan Capistrano $1,418,712, for a total allocation of $9,051,696; d. Adoption of the Amended Five-Year Plan for the Permanent Local Housing Allocation Program; e. Certification of compliance with public notice, public comment and public hearing requirements in accordance with the Permanent Local Housing Allocation program guidelines; and f. Agreement to use the Permanent Local Housing Allocation funds for eligible activities and comply with the program requirements, rules, guidelines, laws and agreements including subgranting funds to other entities. |
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4. |
Approve Agreement with the City of San Juan Capistrano to provide a Permanent Local Housing Allocation grant for the development of affordable rental housing in an amount not to exceed $566,332 in Year 2 and estimated $1,347,776, for a five-year term as reflected in Attachment C and authorize the OC Community Resources Director or designee to execute Agreement. |
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5. |
Approve Amendment Number 1 to the Permanent Local Housing Allocation Agreement with the City of La Habra in the form of Attachment D to allow the County of Orange’s Health Care Agency to administer the agreement with the City of La Habra for designated entity services for the joint project in the North Service Planning Area, for $900,465 in Year 2 and estimated $3,476,004 over five years, as reflected in Attachment H and authorize the Health Care Agency Director or designee to execute the amendment. |
SUMMARY:
Approval of the Substantial Amendment to the Permanent Local Housing Application Five-Year Plan; resolution authorizing the submittal of an application to the state for Permanent Local Housing Allocation funds and Grant Agreement with the City of San Juan Capistrano; and Agreement with the City of La Habra for use of Permanent Local Housing Application funding will support the continued investment in housing and community development activities throughout the County.
BACKGROUND INFORMATION:
In 2017, then Governor Brown signed a 15-bill housing package aimed at addressing the state’s housing shortage and high housing costs. Specifically, it included the Building Homes and Jobs Act (Senate Bill 2, 2017), which established a $75 recording fee on real estate documents to increase the supply of affordable homes in California (Attachment A).
The State of California Housing and Community Development Department (State) created several new grant programs to disburse the funding collected, including the Permanent Local Housing Allocation (PLHA) program for allocation of the funds to local governments. Of the PLHA funds, 90 percent will be distributed to Entitlement Jurisdictions, based on the 2017 Community Development Block Grant (CDBG) Formula Allocation, with the remaining 10 percent to be disbursed in a competitive process to Non-Entitlement Jurisdictions. The County of Orange (County), as an Urban County, is eligible to apply for the Formula Allocation as an Entitlement Jurisdiction to receive PLHA funds from the State based on the 2017 CDBG Formula Allocation and will receive an allocation and administer the PLHA program on behalf of the Urban County cities of Brea, Cypress, Dana Point, La Palma, Laguna Beach, Laguna Hills, Laguna Woods, Los Alamitos, San Juan Capistrano, Seal Beach, Stanton and Villa Park, as well as the unincorporated areas of the County.
On July 14, 2020, the Board of Supervisors (Board) approved applying for Year 1 Allocation of PLHA funds. On May 3, 2021, the State released a Notice of Funding Availability (NOFA) for the Year 2 Allocation of PLHA funds. The County’s PLHA Formula Allocation for 2021 is $1,977,337. Due to the number of real estate transactions recorded in each county varying from year to year, the revenues collected in subsequent years will fluctuate. Therefore, the five-year PLHA Formula Allocation amount has been estimated not to exceed $7,632,984.
Effective July 1, 2021, the City of San Juan Capistrano joined the County as an Urban County city. During the Year 1 PLHA application period, the City of San Juan Capistrano did not apply for its PLHA Allocation. As an Urban County, the County is authorized to apply on behalf of the City of San Juan Capistrano for Year 1 and Year 2 PLHA Allocation, which amounts to $566,332 for Years 1 and 2 and a not to exceed amount of $1,347,776 for the Five-Year PLHA Plan (Plan) period. The County will receive $29,807 in administrative funds for Year 1 and Year 2 PLHA Allocation and a not to exceed amount of $70,936 to administer the City of San Juan Capistrano contract. Therefore, the County will apply for a total of $2,573,476 in PLHA funds in the Year 2 Application (the $1,977,337 Year 2 formula allocation plus the Year 1 and Year 2 $596,139 for the City of San Juan Capistrano). Due to the increase in total funds of more than 10 percent and/or the addition of activities not previously included in the Plan, the County must make a Substantial Amendment to the Plan.
The PLHA guidelines require entitlement jurisdictions that are Urban Counties to ensure geographic equity in the distribution of funds to the Urban County cities. The County will provide funding based on the formula allocation for each Urban County city for an eligible activity chosen by the jurisdiction. The Year 2 PLHA Application and Substantial Amendment to the Plan in Attachment B shows the jurisdiction’s allocation and the activities to be undertaken, as further summarized in Attachment H PLHA Year 2 Formula Allocation Summary of Activities.
While the PLHA Program allows funding for 10 eligible activities, the Urban County cities and the County chose three eligible activities that target households with income at or below 60 percent Area Median Income (AMI). One of the eligible activities is Section 301(a)(6) of the PLHA Guidelines, which includes: assisting persons who are experiencing homelessness or at risk of homelessness, including, but not limited to, providing rapid rehousing, rental assistance, supportive/case management services that allow people to obtain and retain housing, operating and capital costs for navigation centers and emergency shelters and the new construction, rehabilitation and preservation of permanent and transitional housing. The County is recommending to fund the Yale Navigation Center and Laguna Beach selected to fund its Alternate Sleeping Location. Dana Point selected to fund case management and supportive services for individuals experiencing homelessness and those at risk as part of its effort to address homelessness under this activity.
In addition, the Urban County cities in the North Service Planning Area (SPA), including Brea, Cypress, La Palma, Los Alamitos, Stanton and Villa Park, have collaborated with North SPA entitlement jurisdictions of Buena Park, Fullerton, La Habra, Orange, Placentia and Yorba Linda to provide PLHA eligible services at the Buena Park Navigation Center and the Placentia Navigation Center. The North SPA cities designated the city of La Habra to serve as the Treasurer for the jointly-funded project. Therefore, under the PLHA Guidelines, the County initially executed a five-year agreement with the City of La Habra to allow PLHA funding to be allocated to an entitlement jurisdiction on behalf of the North SPA Urban County cities in the collaboration. In order to provide funding to this collaboration, initially the County, through OC Community Resources (OCCR), entered into a PLHA Agreement with the City of La Habra (La Habra Agreement). Staff recommends approving Amendment Number 1 to the La Habra Agreement (Attachment D) to allow the Health Care Agency (HCA) to administer the PLHA Agreement and better coordinate PLHA funds for homeless services with existing support services provided by HCA and the County’s Office of Care Coordination.
Another eligible activity chosen is Section 301(a)(7) of the PLHA Guidelines, which includes accessibility modifications for seniors. Laguna Woods and Seal Beach have chosen to fund this eligible activity.
If at any time over the five-year period the County reallocates more than 10 percent of its funds among activities, the jurisdiction must obtain approval granted by the governing body at a publicly noticed public meeting and also approval from the State for any amendment to the Plan.
The reason for the Substantial Amendment is that the City of San Juan Capistrano joined the County as an Urban County city effective July 1, 2021. During the first year PLHA, the City of San Juan Capistrano did not apply for their Year 1 allocation. Therefore, the County is authorized to apply for the City of San Juan Capistrano’s allocation and administer the PLHA program for them. The City of San Juan Capistrano anticipates working with a developer for the creation of affordable rental units. Under the Fiscal Incentives for the Development of Affordable Rental Housing Grant Agreement with the City of San Juan Capistrano (Attachment C) under Section 301(a)(10), the County will provide a fiscal incentive in the form of a grant to the City of San Juan Capistrano to effectuate the development of an Affordable Housing Project in the City of San Juan Capistrano, provided that the City of San Juan Capistrano has made an equal or greater investment in the project. The City of San Juan Capistrano has met this requirement as shown in Attachment C and will be using the PLHA funds for pre-development, escrow closing and approval of entitlements for the approval of affordable rental units. The project is anticipated to consist of 40 rental units affordable to households with incomes at or below 30 percent AMI. Nine units will be for households at or below 50 percent AMI and the manager unit will be available for households with income at or below 120 percent AMI. It is anticipated that San Juan Capistrano will loan the funds to the Developer. Any program income it receives from residual rent receipts must be used by the City of San Juan Capistrano on any PLHA-eligible activities.
The County is also allowed to use no more than five percent of the PLHA funding for costs related to the administration of activities for which the allocation was made. For Year 2, the amount for administration to the Urban County cities is $98,866 and the City of San Juan Capistrano administration amount is $29,807 for a total of $128,673 to administer the PLHA plan.
On October 15, 2021, a Public Notice was published in the Daily Journal, La Opinion and Vien Dong Daily, newspapers of general distribution in English, Spanish and Vietnamese, advising the public of the opportunity to review the proposed PLHA Year 2 Application and the proposed Substantial Amendment to the Plan. The Public Notice also advised that a public meeting was scheduled for December 7, 2021, by the Board, which fulfills the PLHA public meeting requirement. No public comments were received.
OCCR recommends approval of the Plan, resolution authorizing the submittal of an application to the State for PLHA funds, approval of the Agreement with the City of San Juan Capistrano and approval of Amendment 1 to the La Habra Agreement for the purposes of allocating and distributing PLHA funding toward eligible activities.
Compliance with CEQA: This action is not a project within the meaning of CEQA Guidelines Section 15378 and is therefore not subject to CEQA, since it does not have the potential for resulting in either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment. The approval of this agenda item does not commit the County to a definite course of action in regard to a project since the Permanent Local Housing Application Five-Year Plan resolution authorizes the submittal of an application to the State for PLHA funds and approval of an Agreement for the disbursement of funds to support the continued investment in housing and community development activities throughout the County. This proposed activity is therefore not subject to CEQA. Any future action connected to this approval that constitutes a project will be reviewed for compliance with CEQA.
FINANCIAL IMPACT:
Additional appropriations and revenue will be requested in Mid-Year Budget Adjustment Report for the PLHA program in Fund 15G FY 2021-2022 Budget and will be included in the budgeting process for future years.
The County will receive a total Year 2 formula allocation of PLHA in the amount of $2,573,476, of which $128,673 will be set aside of administrative costs and $2,444,803 will be allocated to eligible activities.
STAFFING IMPACT:
N/A
REVIEWING AGENCIES:
Health Care Agency
ATTACHMENT(S):
Attachment A – Building Homes and Job Act (SB 2, 2017)
Attachment B – PLHA Year 2 Application and the Substantial Amendment to the
Five-Year PLHA Plan
Attachment C – Contract No. 21-23-00076-PLHA--PLHA Fiscal Incentives For The
Development Of Affordable Rental Housing Grant Agreement with City of San Juan
Capistrano
Attachment D – Amendment No. 1 to the Permanent Local Housing Allocation
Agreement Between the City of La Habra and the County of Orange
Attachment E – Resolution of the Board of Supervisors of the County of Orange
Authorizing the Application and Adopting the Revised 5 Year PLHA Plan for the
Permanent Local Housing Allocation Program
Attachment F – Affidavit of Publication & Proof of Publication
Attachment G – Public Notice Five -Year PLHA Plan
Attachment H – PLHA Year 2 Formula Allocation Summary of Activities