 Okay, good afternoon everybody call the meeting to order of the City of Santa Rosa Housing Authority special meeting for December 16th 2019 and I believe in terms of real call do we have everybody here and so if the record can just show that and just just a Commissioner Downey the elevators broke Commissioner Downey will be participating from up on high and he's connected via a microphone so unfortunately can't be down here with us today but it will make it work. The first thing is item number three and it is something that I guess I'm sad and I'm also excited about being able to do and that's to you know I'll stay here since the microphones available here. This is a proclamation of appreciation for Carmelita Howard and I'll read it lots of warehouses which is something that we all do and we're involved with the city business. Warehouse in April 2000 Carmelita Howard joined the City of Santa Rosa as a housing technician it seems like only yesterday Carmelita I remember that whereas on September 6th 2002 Carmelita was promoted to housing compliance technician I remember that as well I was still involved with those kinds of responsibilities and then whereas on June 20th 2004 Carmelita was promoted to senior housing technician and whereas on July 10th 2005 Carmelita was appointed economic development and housing manager doesn't end there whereas on October 2nd 2016 Carmelita was promoted yet again to deputy director of housing and community services. Pretty impressive Carmelita MSA and whereas Carmelita provided management oversight to the housing choice voucher program and its various voucher products the neighborhood revitalization program and the city code enforcement program and whereas Carmelita always sought organizational efficiencies balance work assignments timely property inspections and ensured that sponsored housing was decent safe and sanitary and met building codes and whereas Carmelita has earned the respect and admiration from policy makers I can certainly agree with that the city manager directors managers and staff of the Department of Housing and Community Services her peers throughout the profession and community stakeholders all of those groups certainly recognize Carmelita's great work therefore be it resolved that Carmelita is recognized as a faithful dedicated and hard-working professional who has most certainly made a difference to Santa Rosa's most vulnerable residents that's kind of the key right there be it further resolved that Carmelita Howard will be so sorely missed and is hereby wished a well-deserved retirement Carmelita congratulations and also I think it's because of our HCS family that do not only like what they do and they also believe in what they do and that's why we're here and we have made sure that you know we were working for not only our clients but for the community thank you so Carmelita asked after a brief respite you can move to the city and you can become a member of the Housing Authority Commission it's much more fun from this side of the DS yeah okay we're on to item 4 of the agenda which is a statement of abstention and ask any member of the Housing Authority Commission if they need to abstain from any item on the agenda I'm going to have to abstain from item 9.1 on the agenda and I'll have to apply to do a comprehensive interest okay and that's a consent item okay thank you any others okay and others we'll move to item five and I believe we have one speaker card from Janet Matthews for Lisa Simmons Janet Dear Mr. Director Green and members of the Housing Authority the purpose of for Alisa Simmons. Ms. Simmons had spinal surgery. She has neuropathy and has some cognitive issues. So I am speaking in her behalf as a family member and her advocate. More than two years ago, Ms. Simmons was advised to apply for Section 8 housing since she was homeless and disabled. She promptly followed the instructions of Catholic charities and the city of Santa Rosa personnel. In September 2019, after waiting a very long time, Ms. Simmons was contacted by Teresa, the manager of Bethlehem Towers, and told she had been chosen from the list provided by the city of Santa Rosa Housing Authority Section 8 to receive an apartment. Ms. Simmons was overjoyed. She went to Bethlehem Towers, filled out, and updated the subsequent paperwork. Was approved, shown her apartment, and told that her move-in date would be November 1st, 2019. Several months later, on November 1st, 2019, Ms. Simmons was informed that she could not move in to Bethlehem Towers because she was not 62. She is currently 58. Even though the HUD department does allow people under 62 Section 8 City of Santa Rosa does not through their contract. Ms. Simmons contacted the City of Santa Rosa about her unexpected denial and did not receive a response for 14 days. Ms. Sylvia Coombs said she would provide a letter, that was Elise's technician, which never happened. Instead, Ms. Coombs told Ms. Simmons that she would need to refile an application and abruptly disconnected the call. Today, Ms. Simmons tried to obtain a copy of her original application from Ms. Sylvia Coombs, Housing Authority technician, and was treated very rudely and told she would never get an apartment. As you can see from the attached documents, I've provided a copy of my statement, our letter, and our new application. New housing applications make the age designation of 62 clear, but this was never made known to Ms. Simmons, including in September and October of this year when Ms. Simmons was already provided assurance of her housing placement. Ms. Simmons remains in desperate need of housing and cannot endure more time on a wait list. She has refiled on the pre-application. May I finish this little bit? You just finished up if you would please, yes. She has refiled on the pre-application list for the Rosenberg Building anticipating a two-year wait. To be eligible for housing, Ms. Simmons followed every instruction, including emptying a storage unit of the few possessions that she had. Her placement in housing needs to be expedited. What happened to the two years and six months when she was in the queue and fell through the crack? And we feel Sylvia needs to be held accountable. How many technicians looked at this paperwork over the years and did not notice that her birth date, which is clearly on the original application, made her at the time 56 when she first filled out the application. She was not told anything about this. She had to be 62. She's responsible for what has happened and has been at the mercy of several, she's not responsible for what has happened and has been at the mercy of several individuals who failed to provide her with timely and accurate information. Please provide her with the first available housing opportunity, instead of making her begin the process anew. Thank you for your time and attention to this serious matter. It is my hope that no other vulnerable individuals will suffer as a result of misinformation on the original forms and miscommunication from staff. Thank you. Thank you, Ms. Matthews. We have a letter. I think, am I the only one that has a copy of it? Apparently I do, but that's addressed to Mr. Well, it's addressed to all of us. It's addressed to Mr. Vine and others. I'm sure staff will be following up and there's our procedures that can be followed and I'm sure you will be getting the appropriate attention and response. Thank you. Thank you. Thank you for bringing it to our attention. Moving on, unless there's any other comments from the public on item five on the agenda. Apparently we don't see anybody coming forward so we will move to item six, which is Chairman and Commissioner reports. First of all, I'll ask if there are any comments from other members of the commission. If not, I just have a couple of things. One is that I've asked Mr. Glein to put on the next agenda, a nominating committee. So I'd be interested in anybody that wants to participate on that nominating committee and it's time to think about what role you would like to consider playing for the coming year. Typically the first of the year when everything is settled down and appointments have been made, we make a decision for who is going to be the oncoming chair and vice chair. So if you can let me know about your interests on being on the committee or serving in one of those two positions, I'd appreciate that. Secondly, I was interested in hearing a report on the station area plan and I don't know Dave, is that something that's in the future for the housing authority? It's on your agenda for the January meeting. January meeting, okay, thank you, thank you. Unless there's any other comments, we'd move to item seven, which is the committee report section and I don't know, we do have an item on the agenda that has a committee involvement that beyond that, oh, Commissioner Downey. I hope this mic is working myself and Commissioner Johnson Morgan got together and talked about a day in which the house and the commission could get together sometime in the future and we relayed some talking points to Chairman Burke about the outcome of our conversation and it sounds like a study session or an extended conversation would be appropriate to ferret out what would be appropriate for this gathering and what would be better suited for another context as far as the house or staff and the commission side working together and being more familiar with what each other does in this housing container. Thank you for that. I think probably the suggestion I would have, I've seen your outline that you put together and made some comments and suggested that you meet with staff, talk about that and then once that's done and having it on the agenda so that all members of the housing authority can talk about it, ask questions and kind of winnow it down to what is gonna be on the agenda and what the date will be on the venue but thank you for the time that you put into coming up with recommendations on items that are of importance to the housing authority. So can we do that in January as well? We can, well, if I understand you, is first meet with staff and then decide if we have a study session? Yes, yeah, correct. So we'll try and make that work. Yeah, well then what I'm suggesting is that give any report back in detail about what their recommended agenda would be and time and location, those types of things so that other members of the housing authority can participate in that final product. I think that would probably make sense to if there's other concerns or questions, let me know but that's the way I think makes sense to proceed. Taking, okay, so are there any other committee reports let me ask you that first? If not, then we'll move to item eight on the agenda which is the executive director's report. Excuse me, I did have one other thing and that's it going back to chairman commissioner reports and that the mayor at a recent luncheon meeting emphasize the importance of getting the word out. I think it's out there but you never know for sure about the open position on the city council and I believe the deadline for submitting an application for that is the 16th of December. I was looking for my notes here but I'm pretty sure that's the date and then the city council will be putting together they'll be reviewing the submittals from interested people in the community and then I believe it's the seventh or eighth or maybe both those days in January there will be interviews with those that the council invites to participate in those interviews. So if you have an interest in serving just to fill a vacant position, council member Combs has resigned and so that opened up this position and I think that the election for that district comes up about a year from now so I think it's a position that a person would, whoever is chosen would be involved with for approximately a year. So that's something just to get the word out on that. Now back to the items we'll have the, say the executive director's report is the next item that's item eight. Mr. Goyne, any? Thank you chairman Burke. There's two communication items attached to your packet, the housing successor agency report and monthly activities. So I can answer questions on those but I also wanted to add in my report that we're looking to get you larger iPads for your January meeting so you can read tiny numbers in spreadsheets. And then the other thing is just this morning we heard that through the lobbying efforts of rebuild North Bay, a group has been advocating for allocation of disaster related tax credits to help with our rebuilding effort and it looks like there's the request included in the budget compromise being debated this week in Congress the allocation asked for like $1 billion for both the 2017 and 2018 disasters in California. So since this is fresh news I wanted to share it with the housing authority and if so directed we can have the chair sign a letter of support for that bill and we'll be trying to do the same tomorrow with the mayor. So seeing nodding heads we'll put that together for your signature. Great, if I can report. Thank you. Actually I got them out of sequence so that was item 8.2, 8.1 is the fiscal year 2018, 2019 housing successor agency report. Nancy Manchester put that report together it's an informational item. Oh I'm sorry chair I treat item eight all together as one discussion point. It's there for your information. Yeah, thank you. Okay we're to item nine which is a consent item and we have some new members on the commission. Typically the consent item is an item that's fairly straightforward often doesn't involve a lot of discussion but on occasion there's interest on the part of a commissioner to want to ask questions which would require it to be taken off with perhaps a short presentation and then questions. So let me ask if there's any need to pull this off the agenda for specific discussion. Seeing any need to do that. So I would ask for a motion for approval of the consent item involving debt and flats. I'll make a motion to approve the resolution of the housing authority of the city of Santa Rosa modifying a prior loan commitment in the amount of 3,000. I'm on the right one. 3,100,000 to Dutton Flats. Limited partnership for all project costs for Dutton Flats 206, 208, 214 West 3rd Street APN numbers and waive the reading of the text. I'll second. Okay we have a motion and second any further discussion and hearing none. Roll call please. Chair Burke. Hi. Commissioner Downey. Hi. Vice Chair Johnson-Morgan. Hi. Commissioner Olsen. Hi. Commissioner Owen you're abstaining from the vote. I abstain. Commissioner Test. Hi. Commissioner LaPara. Hi. Let the record reflect that the motion carries with six ayes and one abstention. Okay that brings us to items 10 which are the report items in 10.1 and on this we have a report on Burbank Housing Development Corporation's request for extension of Housing Authority loan terms and Nancy Manchester will be presenting this item. So good afternoon Chair Burke and members of the Housing Authority. The item before you today is a request from Burbank Housing to extend the loan terms and regulatory agreements for five Housing Authority loans in association with the refinance of Burbank's first mortgages on the associated properties. As part of the refinance, excuse me, the two first mortgage lenders, Bercadia and CalHFA, are requesting that the authorities loans be subordinated to the new senior loans. A sixth Housing Authority item that is also being refinanced does not need a term extension but the senior lender is also requesting subordination of this loan. So the six properties being financed are Amorosa One, Cypress Ridge, Grossman Apartments, Jays Place, Pannus Place and West Oaks. The proceeds of the refinance will be used to pay off the current senior financing with new 30 year loans at reduced interest rates. The current interest rates range from 4.74 to 7.63%, averaging 6.66%. The new interest rates are either five or 5.47%. Which averages 5.31%, an overall reduction of 1.35%. The proceeds will also be used to make needed repairs to the six properties at an estimated cost for all six at just under $1 million. It will allow Burbank to move forward with developing affordable units in its pipeline. And of particular interest to you, repay $1.7 million of the 3.5 million unsecured loan year approved at the November Housing Authority meeting. So you can see that the total principal amount of the Housing Authority's loans is just under $16 million. And the five loans proposed for term and regulatory extensions have a variety of expiration dates between 2030 and 2039. The requested extensions range from 19 to 21 years. It should be noted that Grossman Apartments does not currently have a regulatory agreement, but staff is recommending requiring one in exchange for the extension of the loan term. So Burbank is proposing subordination of all six loans to the refinanced first mortgages. And it should also be noted that subordination of Amorosa One is within the executive director's signature authority. As previously mentioned, the refinance reduces the interest rates on five of the six loans with old interest rates ranging from 4.74 to 7.63%. And new interest rates are either five or 5.47%. The debt coverage ratio for the six is between 1.15 and 1.25. And subordination does not lower the Housing Authority's lien position, which is already in third place. So the benefit of approving Burbank's request is, as I stated earlier, providing needed repairs, extending the term of affordability for the six properties totaling almost 400 units. It supports development of Burbank's pipeline properties and it provides repayment of 1.7 million of the unsecured note I mentioned previously. So a long recommendation to provide sufficient financial resources so that Burbank Housing Development Corporation can perform needed repairs to the properties listed herein through the refinance of the first mortgages for each property. It is recommended by the Housing and Community Services Department that the Housing Authority by five separate resolutions approve the following. So A, extend the due date of the authority's loan in the principal amount of $1,995,650 for Cypress Ridge, a 122 unit affordable multifamily rental project at 1815 Mita Avenue, and the term of affordability from October 27th of 2030 to October 27th of 2049 and approves subordination of the Housing Authority's loan to a refinance first mortgage. Extend the due date of the authority's loan in the principal amount of $75,215 for Grossman Apartments, a 13 unit special needs affordable multifamily rental project located at 1289 Martha Way from January 10th, 2032 to January 10th, 2049, and approves subordination of the authority's loan to a refinance first mortgage. In exchange for approval of the loan extension, BHDC will execute a new regulatory agreement securing affordability of the property through 2049. Extend the due date of the authority's loan in the principal amount of $619,010 for Jay's Place, a 41 unit affordable multifamily rental project at 2805 Park Meadow Drive, and the term of affordability from December 12th, 2030 to December 12th, 2049, and approves subordination of the authority's loan to a refinance first mortgage. Extend the due date of the authority's loan in the principal amount of $2,291,031 for Panna's Place, a 66 unit affordable multifamily rental project located at 2450 Stony Point Road, and extend the term of affordability from May 1st, 2039 to May 1st, 2060, and approves subordination of the authority's loan to a refinance first mortgage. And finally, extend the due date, extend the due date of the authority's loan in the principal amount of $1,350,000 for West Oaks, a 53 unit affordable multifamily rental project located at 2594 Gernville Road, and the term of affordability from October 31st, 2039 to October 31st, 2060, and approves subordination of the authority's loan to a refinance first mortgage. I'm gonna be happy to answer any questions. I think Larry Floren is also here if you have other questions. Comments, Mr. Floren? Good afternoon, members of the commission. Larry Floren, CEO and President of Burbank Housing. First of all, I wanna thank you for considering this item and also thank the staff that's been working with us now over the last many months. This has actually been something that we've been working on for about, I'm gonna say about a year and a half. It took a lot of work up at Sacramento to get some of our state funders on this program, on our various financing to agree to subordinate their loans in this particular case. Burbank has been committed to being a partner with the city in terms of the rebuilding and recovery. No project probably exemplifies that more than journeys and where we have actually our community meeting at 3.30 this afternoon with the residents there and are preparing to move forward to redevelopment of that site. We really see this as a critical item and that Burbank has over 1,000 units in our pipeline right now and I believe my last count was about 400 of those units are in the city of Siena Rosa. And so these funds would be used, much needed funds be used to invest in our pipeline and get new affordable projects out on the street. I know that some of this is complicated so I wanted to clarify one point just going in. Last meeting we discussed and I appreciate the discussion we had and the actions that the authority took in regards to Lantana. And at that point as you remember, I'm sure first and foremost in your brain from last month was that there were about $7 million in loan connected with the Lantana project. As part of the repayment of those loans and as part of the agreement to renegotiate or to reconfigure those loans, we had agreed to paying 1.8 million back specifically out of the proceeds that would be coming through the refinancing. This is the refinancing we were referring to. We'd also just for your information had committed to applying Cal Home Disaster Relief Funding at the closing of the home, so an additional 1.7. So we had at that point committed to 3.5 million of repaying 3.5 million of the 7 million that had been loaned on the Lantana project. We did receive word that the Cal Home Disaster Relief Funding is coming so we can take for sure that that money will be here. This item, though, is necessary for us to move forward with repaying those notes that were connected to that previous item, and I wanted to clarify that. So again, I just want to thank you for taking it up and obviously happy to answer questions. Thank you, Mr. Florent. I'm going to suggest that we start with a discussion with Commissioner Downey and then we'll move around this side of the piece. I think my first question is you had mentioned that you have some projects in your pipeline. I'd be curious to know how many projects you have in your pipeline and how many units that would lead to potentially low income people. So we have actually our total pipeline. We have about 1,200 units right now. Those that are directly in San Rosa is about 400 units. As you know, Burbank is a nonprofit and we only do affordable housing. And so every one of those 400 units is in fact de-restricted low income affordable housing. Just to, let's, I'm going to suggest because if we don't, it's going to be a discussion outside of the members of the Housing Authority. So if you have questions, that's fine. We can ask Mr. Florent to come up and respond to any questions that you might have, but let's do that at the end of this discussion. So any other comments, Commissioner Downey? No, at this point, thank you. But if you do have questions, you know, we'll certainly have an opportunity to ask those at the applicant. Commissioner, we'll start here. Commissioner Borough? Sarah? I think we need a second. Excuse me, Commissioner LaPaire, can you turn on your mic? Thank you. You're right, this is really quite familiar from our last meeting. I didn't understand at that meeting that there is a follow on of refinance. These are completely connected. Can you explain a little bit more about why these refinances are connected with the meeting that we had? I'll take the staff question for that, if they may. Yeah, if we can do that, we'll say that, and after the discussion we'll ask Mr. Florent to. Thank you. So it's not a bad idea, though, to have your questions, though, that Mr. Florent's ready to respond to those when we're ready to do that. So the... Any additional comments? Oh, okay. Mr. Ryan? So in the staff report, there's attachment six, and that's a letter from Larry Florent highlighting the four key points that link it up to last week. And it reads that they're gonna pay off the hard debt on the properties being refinanced with new 30-year loans that are reduced interest rate. They're gonna make, with that proceeds, they're gonna make improvements to the properties that are identified in the physical needs assessment attached to the staff report. So that's a benefit to the Housing Authority. Use the refinance proceeds to prepay 1.7 million of the 3.5 million unsecured promissory note. And that's what was a difficult discussion last month that $3.5 million was unsecured. This pays off over half of it. And then it allows Burbank to move forward with their pipeline that you just heard Larry say has over 400 units. So it's a complicated way to walk through six, seven properties with different characteristics and pull out different monies. But that, I think, really summarizes it for us. Thank you. Commissioner Olson. I just wanna clarify. The first question in the refinance, are they taking out loans that are larger than the amounts they actually owe now? And is it true from what I read that we are still in third position as we were before? So yes, we are still. We still will be in third position as we are now. And there is cash coming out of all the loans. But as I said, that's going to be used for the items that Dave mentioned in the letter from Larry. So paying back the 1.7 million of the unsecured promissory note, making property improvements to the six properties. Where's the other two? Supporting Burbank's pipeline and then to pay off the current senior financing and replace those loans with lower interest rate loans. But the amount is approximately the same? The current first mortgages total around $12 million and they'll be taking out about $25 million. Right, so there's an additional indebtedness of $12 million, right? So actually we're allowing the money in front of us to be improved to being added, an extra $12 million being added to the amount we were ahead of us before. That correct? And the first ahead of us was $12 million less than the first that's ahead of us now. Correct. Thank you. Commissioner Allen. Hopefully staff can answer this. The 1.7 million, there's two lenders on this that's doing the refinances I understand correctly. The closing pros are those going to try and close at the same time, when would the 1.7 million come in to the district? The housing authority. I think that would be a question for Larry. I'm not sure when that would be. One loan is closing at the end of January, I mean excuse me, the end of this month and the others at the end of January, but I don't have the information as far as. So within 30, 45 days they're all closed. Mr. Bassenger may have an answer. Good afternoon, Megan Bassenger, housing and community services manager. Yeah, we're expecting the funds to be in by February. Kelly today is taking it to their senior loan committee, I believe this week for final approval and KDA is also in sequence. So part of this is the rates have locked and so Burbank is proceeding through the process of refinancing these. And then as soon as we receive funds, the housing authority will be notified of the significant paydown of the unsecured note. Thank you. The other question I had, all the loans are in third position. Who's in first and second in each case? I don't have that information with me, but I'd be happy to get it back to you. Okay, thank you. And one other noteworthy item that Larry alluded to in his comments is that the lenders that are ahead of us have agreed to the refinance. So in some cases, HCD has reviewed this and that's part of the process that he alluded to that's been going on for over a year is working with the state financing on these projects. Some of them also have multi-family housing program money, which is another state program that is oftentimes ahead of us. Okay, thank you. Commissioner Test, any questions? Yeah, I didn't see it in the materials. What are the age of these apartments generally? I'd have to get that information back for you. Okay, thank you. I personally feel that the refinances make a lot of sense and properties always need continuing maintenance and upgrades and so forth. And I believe that it's the best way to maintain them is to refinance what you can and extending the loan. I like the idea of extending the loans too. Thank you. Okay, I'm sorry, it was just pointed out to me. The property assessments that are part of your staff report packet have the year built for each property. Commissioner Morgan Johnson? I don't have any questions. Thank you. My questions are around the repair costs for the units. So if you average, which isn't a good thing to do, but I've done it, comes to a little bit under $3,300 per unit, which is not a lot often for older properties. And I note that there was a term used, I think it was called immediate repair. So that tells me that there's other repairs in addition to that. And the property reports that were in the material that was submitted kind of talks about what is, but it didn't talk about what I couldn't find in a way of what the inspectors found in terms of longer term kinds of property improvement needs. And I don't know if that was just something that was too much paper and that's in the file or that's another step that's to come in the future. So I'm interested just kind of generally, what is the long-term strategy for upgrading the properties? You know, kind of with I think the property realization that this is a kind of a first, it's a continuing effort to make repairs, which is something that always needs to be done with properties, but I'm kind of consider about that longer-term strategy and hearing more about that. And I think those are my comments. So we have some questions, some of which maybe staff can answer and maybe if not, then maybe Mr. Florin could respond to. We'd be happy to send out the complete property needs assessment reports for each parcel. They were pretty extensive and so we're trying to keep the amount of reading down. We'd be happy to share that. Yeah, but it's considered more than $3,300 per unit, I'm sure. So I'd be interested in hearing about that. So Mr. Florin, would you mind coming back if you can help me remember what the questions are that were asked, but I know that let's start. So was your question responded to sufficiently by Mr. Gwine? I suppose so. I think we do need more discussion. I did not realize that this involved an increase of an additional $12 million and I myself would like to know a little bit more about the plans for that and why the city should be involved in increasing this amount. Okay, so maybe that's one comment. Are there any other, Mr. Olson, Mr. Allen, down on this end, anything that you need to have responded to? Okay, so yeah, Mr. Florin, if you can talk a little bit. We can first start with your questions, Commissioner Burke, as I think those are, on the capital needs. So the capital needs assessment, just look at the mediator and it prepares that unnecessary for the property. In fact, what we're planning to do is to put some of this funds into a capital reserve account that'll be used to make continuous improvements to the property. One of the ironies of our portfolio and probably many affordable housing portfolios is that the properties that actually need the most work on them don't have the money to do it. And so, but you can't under the current, with each of these being separate limited liability corporations, you can't move the money from one property to another without going through a process like this. So for instance, you imagine you're very familiar with the popcorn and pollen properties. Those generate almost no net residual receipts, no income. We are able to fund our operating reserves for both of those properties, but not make needed repairs. So some of these funds that are generated from these particular six properties will be used, for instance, in that case, in popcorn to do much needed repairs on those properties that are not listed in here. And so there'll be an opportunity to do things that have been on our wish list for a long time as far as many of the other properties are concerned. I don't have that number in front of me. We're actually in the process of assessing what the actual capital needs are for that. But we're just assured a lot of that money is going to go for those long-delayed projects. I think in getting to the issue of additional debt on the property, the one thing you should know is that we are, in fact, we abide by the same rules that we've always abide by when the law has been taken. So we are concerned about debt service coverage and the debt service coverage here, and it's a concept I'm sure Commissioner Owen is very familiar with. The debt service coverage on all of this is 1.25, which basically is intended, means that we can cover the debt that's coming in this property. A lot of ways, the easiest way to think about this in some ways is when you have a mortgage, you might take out a home equity loan and benefit from the equity that have developed in your house. And a lot of ways that's what this is, in part that's what this is, is using and putting to advantage the equity that we've accumulated. Frankly, the bigger issue is the fact that we're able to lock in rates for another 30 years and have predictability on the operating income for each of these properties and also ensure their continued affordability as a result of doing this. So to us, this is a preservation strategy as much as it is a refinancing strategy. The funds that go into capital reserves, I'm assuming those would be in the capital reserves to be used for this list of projects. That's the benefit. So we have, we've got a blank on the number of other properties we have in Santa Rosa, but I'm going to guess it's probably, besides the six, it's probably another 11 or 12 properties. The money will be able to be used for any of those in this case, because it'll be held at the corporate level and then we could deploy it to make capital improvements on other properties that don't have the types of funds they need to make those improvements. Within the city of Santa Rosa, Mr. Florian. In part, yeah, in part the city of Santa Rosa. But I mean, I think you also need to understand that this is a piece, obviously, of the refinancing. I think we're refinancing all total, about 23 properties, 18 or 23, I'm sorry, off the top of my head, I can't remember. So this is about a third of what the total portfolio that we're refinancing. The other jurisdictions, the county, the cities of Healdsburg, the city of Katadi, the city of Sebastopol overall approved this previously, as I previously mentioned, the state has. Thank you. Well, unless there's further questions, I think we'd entertain a motion on this particular item. I have a quick question. Mr. Florian, are you able to keep a capital reserve to maintain your properties, or are you anticipating coming back before the housing authority in the near future to procure more funding for rehab? Is it, are you able to keep a capital reserve at Burbank Housing for property renovation, or are you anticipating continuing to come forward for notice of funding availabilities to maintain your properties in the future? That's right. Okay, so the complicated question, the first thing we do, every property we have already has a capital reserve. In some cases, the first funds that come in for those that are underfunded are used to fully fund the capital reserves at each of these projects. So that's the first use, and that'll actually happen in escrow. So we'll never actually see that money. That money will go, goes directly to the property and fills the operating, fills the capital reserve. Then the second pot of money is used to do the needed what we call the physical needs assessment of the capital improvements to the property that have been identified in the PNAs. We actually can't, that money has to be used for those purposes in their escrow until that time. In general, what we have been doing as a company, and you may notice is we have been doing recent indications of our properties so that when they are in need of major capital repairs, we generally go out and get new tax credits, 4% tax credits for those, and that's the strategy we'll continue to use for most of the properties. Thank you. Okay, before I kind of get back to business at hand and entertain a motion, media services that records these sessions, they're having a hard time hearing the conversation because all of us aren't speaking into the microphone as clearly as we should. So be sure that you're close to the microphone when you're speaking. So now, back to entertaining a motion. Through the chair, can we make a motion for, I see three resolutions on here, but we have more than that, is that correct? Can we combine them or do they have to be handled separately? That's a question probably for our legal counsel. If the commissioners are comfortable, you can make one motion to approve everything and if it gets second in the past, you can do it in one. That's a good question. Yes. Okay. So I'll make this very generic. I'll move to approve the resolutions for us to refinance these, for the refinancings of these properties and the continued subordination of this housing authorities position on each one and waive the reading of the text. Is there a second? I'll take, I'll second that motion. Okay, thank you. Roll call, please. Unless it's for the discussion. Hearing none. Hearing none, roll call, please. Chair Burke. Aye. Commissioner Downey. Aye. Vice Chair Johnson-Morgan. Commissioner Olsen. Commissioner Owen. Aye. Commissioner Test. Aye. And Commissioner Lepera. No. Let the record reflect that the resolutions carry with five, or sorry, six ayes and one no. Thank you all. Moving now to item 10.2 on the housing authority agenda. This is 2019-2020 housing authority loan and project-based voucher notice of funding availability and the recommendations by staff in the committee and this will be Frank Kasemach making the staff presentation. Thank you. Chairman Burke, members of the housing authority. So item as mentioned is the funding recommendations for the 2019-2020 loan and project-based vouchers notice of funding availability or NOFA. The NOFA was issued on August 6th of this year. It identified the availability of approximately $2.5 million of local and federal funds and 75 project-based housing vouchers. Federal funds are from the Community Development Block Grant Program or CDBG and the Home Investment Partnership Program or the Home Program. Both of these programs are within the US Housing and Urban Development Department or HUD and the project-based vouchers are also a HUD program. Specifically, there was a $1.1 million of community CDBG funding, $589,000 of home funding. There was an additional home, CHOTO, which is a Community Housing Development Organization funding of 100,000 and our local funds were 690,000. Coupling the funds and the vouchers into one NOFA creates an opportunity to assist a project in two different ways with one application. In this case, we received 12 applications. They requested over $13 million of funds or five times the available amount. And we also received 126, requests for 126 project-based vouchers, also more than the available amount. The chairman appointed an ad hoc committee consisting of commissioners Test and Owen to work with staff to make the recommendations to the Housing Authority. The recommendations are based upon the evaluation of the applications with regard to the federal funding and the project-based voucher eligibility and program criteria and to the specific evaluation criteria which were set forth in the NOFA. CDBG, home and project-based voucher programs each have programmatic requirements for example, home funds must be the last funds in to the project budget to fill a remaining funding gap. CDBG funds cannot be used for new residential construction. All of these programs trigger federal environmental review. All of them may trigger the Davis-Bacon prevailing wages and associated labor monitoring. Project-based vouchers are limited by program, i.e. city-wide and also by project with certain exceptions. And home rules require that the community development, community housing development organization or CHOTO, affordable housing activities funding for that and also allow limited funds to be used for CHOTO organizational assistance. The specific evaluation criteria that were set forth in the NOFA include project readiness, financial feasibility of the project, qualifications, capability and expertise of the development team to finance and design, build or rehabilitate and manage the affordable housing. The number of units in the unit mix, completeness, accuracy and quality of the proposal and any other information that was requested in the loan application as well as housing authority policies and preferences. Based on these evaluation criteria and the federal program requirements, it was clear to the ad hoc committee and the staff that three projects be recommended for funding at this meeting because they best meet the criteria. More review is needed for five projects to evaluate how best to utilize the remaining funding and vouchers. And a recommendation will be brought before the housing authority at the January meeting regarding these projects. Four projects did not meet the federal funding and or the evaluation criteria and are not being further considered. The funding recommendations are loans of the local funds for two small rehabilitation projects of existing affordable housing units. And one of the funding recommendations are for the operating expenses of a CHOTO. The rehab projects are both owned by community action partnership of Sonoma County or CAHPS. CAHPS requested only funds, no project-based vouchers. One rehab project is an eight-unit building located at 400 Earl Street. The amount of funds requested and recommended is 129,778. The rehabbing activities include new roofing, new gutter and downspouts, water damage repair, new wall furnaces and thermostats, and repair of asphalt and concrete. The other rehabilitation project is located at 2602 Giffen Avenue. This is a single family dwelling with 12 bedrooms. The requested amount and the recommended funding for this project is $103,712. The rehabilitation activities include replacing fences and gates, replacing bathroom facilities, windows, the patio, storage, structure, rear door, surfacing the rear decks. Both projects meet, both of these projects meets selection criteria, evaluation criteria, including for example, project readiness, financial feasibility of the project and the qualifications, capability and expertise of the owner to carry out the project through a contract with a general contractor and the owner's demonstrated ability to manage these projects for very low income residents. Both projects have received prior housing authority funding around 1989, 2000 timeframe. These were 30 year term loans. Earl has a principal balance of a little over $212,000 and Giffen has a principal balance of a little over or almost $144,000. These notes are due in 10 years and the applicant has requested that both loans be extended to align with a current loan to start a new 55 year term. So they would be adding 45 years to their terms. The third recommended funding at this time is the CHOTO operating funds, which are allowed as we mentioned by the home program. The CHOTO, the organization itself is community housing Sonoma County. The requested amount of funding was $50,000 and the recommended funding is $33,000. And the difference is because the home program caps the amount of funds that the city can award under this program to 5% of the city's annual allocation of home funds, which this year turned out to be a $33 cap, $33,000 cap. The funds are our grant and they may be used by the CHOTO for operational assistance in any format, including salaries, rent, training, and other similar activities. The recommended projects represent approximately $266,000 of the total or about 11% of the total funding that was available and none of the project-based vouchers. So that leaves most of the funds and all of the project-based vouchers still on the table. This slide identifies the five projects that requested funding and or project-based vouchers that are being further reviewed for consideration by the Housing Authority at the January 2020 meeting. And if there are any questions about these, we can leave this slide up for just a second or two. I think most of the information summarizing the project is there. Donito actually, it's a rehab project. Kern Veterans Village is new supportive housing for homeless veterans. Boyd Street Apartments is new multi-family housing. Linda Tunis Senior Apartments are new apartments. That's a conversion of an existing non-residential building into these senior apartments. And Canary at Railroad Square is for new multi-family housing as well. Just to add, when we complete our evaluation, we plan to reconvene the ad hoc committee to go over these five projects and come up with the recommendation for your January meeting. The four projects that are not receiving further review due to funding restrictions and our eligibility criteria are these four. And readiness is a factor really for three of them, for Caritas Homes, Crossings on Middle Rink and Colgan Creek. Eligibility use of federal funds also played a factor for crossings in Colgan. Quail Run submitted an application that was inconsistent with an application that they had just previously submitted to the city council which holds a public hearing for tax exempt bonds and the financial pro forma requested additional funds that was not available in that request. And that same pro forma and application that they submitted to the city council was then submitted to the state. And they did in fact receive a bond allocation and tax credits for that project based on that pro forma. So getting back to the recommended projects, this is a locational map of Earl Street project just south of Highway 12 and east of Highway 101. The Giffin Avenue project is located west of Stony Point at south of, south of Sebastopol Road, just near North Point Parkway there. The CAPS projects on Earl Street and Giffin are both ready to begin. A general contractor has submitted bids and can finish the projects in about three months whether permitting. This is a quick use of our funds and it physically preserves the affordable housing stock with the needed repairs and improves the living conditions for the residents. The home CHOTA funds will help community housing Sonoma County with operational costs. Community housing Sonoma County serves homeless veterans and other special needs clients. It is recommended by a housing ad hoc committee and the housing and community services department that the housing authority by resolution one approve a further advance of loan funds to community action partnership of Sonoma County for rehabilitation of 400 Earl Street in the amount of $129,778 and extend the existing loan term to start a new 55-year term. To approve a further advance of loan funds to community action partnership of Sonoma County for rehabilitation of 2602 Giffin Avenue in the amount of $103,712 and extend the existing loan term of that property to start a new 55-year term. And three, approve a conditional grant of home investment partnerships program funds to community housing Sonoma County for community housing development organization or CHOTA operational funds in the amount of $33,000. And I'll be happy to answer any questions you may have. Thank you, Frank. I'm gonna suggest we go in this order. There is one card that's from Paul Carroll. I'm gonna ask him to speak first and then I'm gonna ask the two members of the ad hoc committee for their comments and then kind of go in reverse order from that point in time. So that's the plan. So Mr. Carroll, welcome. Hello, thank you. The two properties in question they house low-income clients. The one on Giffin, I mean on appearance it's a single house, but it's a transitional shelter that has 22 beds and it houses women and women with children. And it's not a low barrier shelter so we're not under coordinated entry so we're able to run a program there. I want to thank the housing authority. I wanna thank Frank Kasemoff for working with me on the applications. That state application is quite a challenge. And I wanna thank Megan Bazinger and David Gwine who we initially came and talked to about this. This will allow us to both solve significant capital needs at the Earl Street property and it will allow us to make the transitional shelter a much more comfortable place for people to stay in. Right now we have a number of single pane windows there and in the summertime on the west side of the bill building it can get very, very hot in the rooms. And so this will assist in that quite a bit. We're also hoping we had a donation to do a playground there and once this work is done we're gonna be able to move ahead with that as well because at any one time we could have four or five young children there and the current playground is not what I would call risk ready. So this is something that we want to put in something that we don't have to worry about. So we wanna thank you again. Thank you, Mr. Carroll. So, commissioner Tes, commissioner Allen, would you like to add anything to what you heard already from the presentation from Mr. Kasselman? What we discussed were the viability of these particular projects that we're discussing today. And when you look at all of the restrictions on these funds to be able to, even though there's a lot more in the pipeline, to be able to allocate it and meet all of these funding restrictions was pretty amazing to me. So that was my comment. Yeah, yeah, good so. Yeah, it's something that's not obvious but it's always important to point out that the decisions are sometimes restricted by lots of requirements that exist from lenders in the programs. So yeah, Mr. Carroll. I wanted to continue on with what commissioner Tes said that we also looked at, we were continuing to support facilities that already have housing authority funding and enhance those and help them to be able to do the good work they're already doing. Just one kind of a side note, I appreciate, I think this came from further past discussions that we've had, having the maps that identify the location of the sites is really a benefit and thank you for making sure that it happens. Probably would have been helpful for item 10.1, so we can make that kind of a common practice. When you're looking for the sites, to refresh your memory, it's always nice to have those maps, so thank you. So yes, commissioner Tes. I just had a question, how this technically will work? Will the documentation be a new loan or will it be an amended loan or how does that work? You know, it actually can go either way in general. It's gone both ways as a further advance and that's kind of the simpler way to do it. So we would go into this looking as a further advance. Another approach would be to have an amended and restated or a new loan. So we'll try to go for whatever the simplest, easiest way is and then kind of move up from there and when we get into the loan documents, we'll make that determination and that's all done administratively. Thank you. That's also just to kind of keep the reverse or commissioner Morgan Johnson. I did have a question about the, it was mentioned that a wall would be replaced at Giffin. Is that the exterior wall that has the windows that you were mentioning? So a wall is not being replaced. Okay. Okay. I was wondering about that. Thank you. Mr. Onliss, you have any other comments? Okay. Mr. Olson. We're now putting the financing out of 55 years. You know, and these are those two specifically Earl and Giffin, those are old properties. So just thought of what happens because he's gonna fall down a long before 55 years is up. You know, we're not extending, we're extending the funding. They're not paying on the money until it's a 55 years up. Is that right? Or are they paying on the money as we go here? So the new loans that we do are typically 55 years. The first loans on those two properties were 30 year loans which expire in 10 years. They're doing 10 years. This request before you would extend those to align with this particular loan. So basically a new 55 year term. All of our loans are for these properties are residual cash receipts because these are units that are targeted to extremely low income households and the rent levels are very low. We do not receive any residual cash receipts. So essentially we're buying the affordability. The loan will become due and payable at time of sale. And as the project will need more extensive work, we will continue to work with the owner to address the rehab. But there is a time which none of us will be here but where the lines cross we're continuing to fund that particular product is no longer makes any sense at all. Is there a way that that time is determined? At this point in time we have not identified what the ultimate future of the property will be. But as the work that is needed becomes more extensive we'll work with the owner to decide whether or not to put more money into rehabbing the unit or maybe eventually it could be rebuilding the structures and enhancing the property. So what of the properties, the foundation collapses or something of that type that is not really repairable without much, much money. So then do, or there's a red tag put on it by the county or the city. Do we then, and the property is torn down, do we then forgive the loan or what happens then? We would have to address those situations as they arise. And I think one of the main objectives too is that you have assurance that the units are going to be affordable to lower income members of the community until there's, well, whatever the changes of the sold or whatever they have to pay off the loan if there's major problems with the property you'd have to come up with additional funds to improve it. But one of the main objectives is getting the affordability for an extended period of time. I think that's one of the main objectives. Yeah, I was just wondering what the mechanics or when it becomes a point where it's not viable. Yeah, I mean, I think, I don't know. You know, that's a difficult question to answer, but I think it's a matter of you still have the property, you still have it secured and whatever you can do to continue the affordability some way somehow on that property or elsewhere with the loan being paid off as the would be the objective. That's my view anyway, that's right. Doesn't the maintenance that we extend to these buildings, I mean, that helps to make sure that these buildings are not falling down in 55 years. That's the whole point of the maintenance aspect of this. Correct, that one of the objectives of these further advances is to help prolong the life of the building and make the residents comfortable keep it a safe, healthy environment for those residents. Additionally, through a part of our compliance process, these units were originally acquired and the initial work was done with home funds which requires regular monitoring and inspection. So these particular properties do benefit from that process. Commissioner LaPara. It looks like you have put a tremendous amount of work and effort into designing these and taking into consideration the needs of the people. Thank you. Thank you. Commissioner Danni, we haven't forgotten about you up there. It sounds like rehabbing old buildings is becoming a more predominant funding opportunity for the city with old buildings. Things break, people get hurt. So my question for legal is, you know, God forbid somebody got hurt in an older building that the city was partially funding to rehab. Could anything come back to the city in the form of a lawsuit or any kind of liability? So in the loan documents, the regulatory agreements and the others that we execute with developer lender is to ensure that they're gonna indemnify us. There's an indemnification provision and there's also insurance requirements as well. Thank you. Okay, well, thank you all. Good discussion. We're at that point in time unless there's any further questions, last minute questions, time to entertain a motion, probably from a member of the committee that made the recommendation. I'll move to approve the resolution for whispering referred to the CHC property, the Earl property. Do we wanna talk, give it in this time? I second that. Yeah, a motion. Chairman, the second came from Commissioner Downey. Oh, I'm sorry, I'm sorry, I didn't pick that up. Thank you, thank you both. Any further discussion, hearing none? A roll call please. Chair Burke. Aye. Commissioner Downey. Aye. Vice Chair Johnson-Mortigan. Aye. Commissioner Olsen. Aye. Commissioner Owen. Aye. Commissioner Test. Aye. Commissioner LaPera. Aye. Let the record reflect that the resolutions carry with every commissioner, aye. Thank you. We're to item 10.3 on the agenda. So this would be a modification to Cal Home Disaster Assistance Loan Program Guidelines. We have Nancy Manchester making a staff presentation. So as you'll recall, the Housing Authority applied to HCD, the California Department of Housing and Community Development, and was awarded a $1.2 million grant to create the Disaster Assistance Loan Program for households whose homes were lost or damaged in the 2017 Tubbs Fire. Currently, the program is limited to households earning up to 80% of the area median income who owned and occupied their single family homes at the time of the fire, and who plan to continue to occupy the homes of their principal residents. Other requirements that are mostly based on HCD regulations is that there's a maximum of $100,000 alone for gap financing. There's reconstruction or rebuilding, rehabilitation cannot have begun, and after reconstruction, value may not exceed the monthly California Association of Realtors median price. The most recent price up right now is October of 2019, and that's $660,000. The other requirement of the program is that all loans have a 30-year term, deferred payment at 3% simple interest, that's Housing Authority policy. So based on updated HCD guidelines, we're proposing expanding the program to the program's income limit to those earning up to 120% of area median, and based on community interest, expand the housing type allowed to include mobile homes located within the Santa Rosa city limits. The benefit of these changes is that wider eligibility will result in more units assisted and increase the likelihood of utilization of the grant funds prior to the expiration of the Housing Authority's standard agreement with the HCD in September of 2021. And I'd like to just add, this was in your staff report, but I wanted to point it out, we've had four applications for the program, and we've been able to approve one. One application has some questions outstanding still that I'm waiting for responses on, and the other two, one was over income, and the other was planning to do the work himself, and that is not allowed under HCD regulations unless the applicant has the same licensing, that the same type of a license as the work that he is planning to do. So that's where things stand right now with that program. So it is recommended by the Housing and Community Services Department that the Housing Authority, by resolution, approve amendment of the program guidelines for the Cal Home Disaster Assistant Loan Program. To one, allow those earning up to 120% of the area median income to qualify for the program is now allowed by HCD. And to prevent loan funds to be used as gap financing for replacement or rehabilitation of manufactured or mobile homes located in mobile home parks within the Santa Rosa city limits. And I'd be happy to answer any questions at this point. So there are no requests for a public comment on this one. So we'll move to a discussion on the part of the Housing Authority, and why don't we start down here to the right? Commissioner Tess, Commissioner Morgan Johnson. I think it's a good move, frankly, to be a homeowner and a homeowner with income of less than 80% is very tough in Sonoma County. And do you have any idea in terms of, since the proposal is to increase it to 120% of median, how many might have that opportunity? There was a great deal of interest in the community, in the program when we rolled it out. And as you point out, so many people who own homes are just above that 80%. So we're hoping we'll have a great deal of interest once we make the announcement if you approve this. Thank you. The addition of the funds being able to be used for mobile homes, that was not part of the original rules of the program, correct? It's allowed under HCD regulations, but when we applied for the program, we chose to include only single family homes because the lion's share of the units destroyed in the fire were single family homes. I see, so I guess I did not realize that mobile homes were never classified as single family residences. But okay, so with the addition of that, is there any direct connection with Journey's End? Is that something that, is that a push to be able to help those persons living in Journey's End particularly? I think this will present an opportunity for those who need to replace their units to apply for funding. But again, it's a gap funding, so it's up to $100,000, and they have to have all other funds committed before we can approve a loan to them. Thank you. Commissioner Downing, any comments? Yeah, I'm curious about this. I know a gap funding is, I'm curious about the difference between gap and under-insured, as far as people who have existing insurance policies that won't be able to replace their homes because their insurance companies won't pay for the reconstruction. So could you elaborate on gap funding and under-insurance? So gap funding is considered the money that comes in after every other assistance that might be provided to the homeowner. So it would be whatever insurance proceeds they're able to get if they applied for and received FEMA funds, if they applied for and received SBA funds, if anything else that might be committed to the rebuild, then the Cal Home Funds can come in as gap funding. Commissioner LaPera, thank you. Commissioner Olson, Commissioner Owen. Is it possible for a developer that owns multiple lots to come in and apply, or is it individual homeowners? It's only individual homeowners who have to have owned and occupied the home at the time of the fire. Well, my comments are that it was gonna be hard road to hoe from the beginning, just the combination of the income and the ownership. So moving in this direction makes very good sense to me. So at that point, I entertain a motion for approval or a motion, whatever it may want to be. Whatever the motion may be. I'll make a motion to approve the resolution of the Housing Authority of the City of Santa Rosa, approving modifications to the Cal Home Disaster Assistance Among Program guidelines, and waive the reading of the text. Thank you. I'll second that motion. Okay, we have a motion and we have a second. Yes, Commissioner Olson. I'll second the motion. Okay, I think we have one over here already. Commissioner Morgan-Johnson, yep, sorry. I think we're good. But without unless there's any further questions, roll call please. Chair Burke. Aye. Commissioner Downey. Aye. Vice Chair Johnson-Morgan. Aye. Commissioner Olson. Aye. Commissioner Owen. Aye. Commissioner Test. Aye. Commissioner Lepera. Aye. Let the record reflect that the resolution carries. These are all the items on the agenda this afternoon, so we will stand adjourned. Thank you very much.