HomeMy WebLinkAboutItem 2C: Approval of Funding for Affordable Housing Projects
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Approval of Funding for Affordable Housing Projects
Meeting Date: May 29, 2007 Agenda Item Number: 2C
Department: Planning and Development Staff Contact: Stephanie Jennings
www.eugene-or.gov Contact Telephone Number: 682-5529
ISSUE STATEMENT
The City Council is asked to approve the use of HOME Investment Partnership Program (HOME) funds
and other resources for four affordable housing developments selected through the 2007 Housing
Request for Proposals (RFP).
BACKGROUND
The City of Eugene established current goals and programs for the development of housing affordable to
low-income people through the adopted 2005 HUD Consolidated Plan. The Consolidated Plan guides
the use of Federal HOME Investment Partnership Program (HOME) funds and Community
Development Block Grant (CDBG) funds over a five-year period. Each year, City Council approves the
allocation of federal funds through a One-Year Action Plan. In addition to use of federal funds, the City
of Eugene has established System Development Charge (SDC) Waivers and the Low-Income Rental
Housing Property Tax Exemption to further enable the development of affordable housing.
Pursuant to the Consolidated Plan and One-Year Action Plan, staff develops and releases an annual RFP
for affordable housing development projects. The intergovernmental Housing Policy Board advises
staff on the development of the RFP, reviews proposals, and makes funding recommendations to the
City Council. The City issued the 2007 Housing RFP for affordable housing projects in November 2006
and proposals were due in February 2007. The RFP offered Federal HOME funds, Eugene System
Development Charge (SDC) waivers, Eugene Water and Electric Board System Development Charge
waivers, City of Eugene Low-Income Rental Housing Property Tax Exemption, and Lane County Road
Funds. The RFP sought proposals for: 1) use of HOME funds for the development or acquisition of
affordable housing; and 2) preliminary proposals for land acquisition for housing for people with
disabilities. A landbank site was not offered in this round of funding due to two factors: 1) the
landbank site awarded in the 2006 RFP has not yet received the State funding necessary to proceed; and
2) multiple housing developers were seeking funds to develop sites already under their control.
Four proposals were received through the 2007 Housing RFP for use of HOME funds and local
resources. No proposals were received for acquisition of land for housing for persons with disabilities.
Submitted proposals were reviewed by staff, the Eugene Allocations Committee of the Housing Policy
Board, and the full Housing Policy Board (see Attachment A for member list). The Housing Policy
Board recommends four proposals for funding. They are as follows:
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New Mixed Use Rental Development on West 11by St. Vincent dePaul Society of Lane County,
Inc. (SVdP)
– SVdP requests $525,000 in HOME funding and $111,500 in Eugene SDC waivers to
support the development of 35 units of rental housing affordable to persons with incomes below
50% of area median income. The HOME funds will be used for predevelopment, development soft
costs, any tenant relocation costs, and other eligible costs and will be structured as a deferrable no-
interest loan. The units will be targeted to singles, couples, and persons with special needs. The
development will also include 7,255 sq. ft. of commercial space on the ground level that will be
rented by SVdP for a bookstore. SVdP will apply for Federal Low Income Housing Tax Credits as
the primary source of subsidy for the project. SVdP owns the site for the proposed development,
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which is located at 1880 West 11 Avenue. The total cost of the project is $7,705,365. SVdP also
plans to apply for the City of Eugene Low-Income Rental Housing Property Tax Exemption.
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New Transitional Housing Development on Highway 99 by Sponsors, Inc.
– Sponsors, Inc.
requests $550,000 in HOME funding and $140,000 in Eugene SDC waivers to support the
development of 42 units of single room occupancy transitional rental housing for men recently
released from prison. The HOME funds will be used for predevelopment, development soft costs
and other eligible costs and will be structured as a deferrable no-interest loan. Of the 42 total, 30
units will be affordable to persons with incomes below 30% of area median income. The remaining
12 units will be affordable to persons with incomes below 50% of area median income. Sponsors,
Inc. plans to apply for Federal Low Income Housing Tax Credits as the primary source of subsidy
for the project. Sponsors has an option to purchase a .55 acre parcel located on Highway 99 for the
proposed development and is currently seeking state funds to purchase the site. The total cost of the
project is $3,169,495. Sponsors, Inc. also plans to apply for the City of Eugene Low-Income Rental
Housing Property Tax Exemption.
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New Homeownership Units at 2 Avenue and Blair Boulevard by Neighborhood Economic
Development Corporation (NEDCO)
– NEDCO requests funding to support the development of
seven homeownership units that will be targeted to households with incomes below 80% of area
median income. The proposal requests an interim HOME loan of $210,000 and Eugene SDC
waivers of $28,000. NEDCO’s proposal also includes a request for a $35,000 Homebuyer
Assistance Program (HAP) loan for each homebuyer at the time of sale. NEDCO owns the site for
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the proposed development, which is located at 2 Avenue and Blair Boulevard. The total project
cost is $1,405,995.
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Rehabilitation of West 8 Apartments by Mainstream Housing, Inc. (MHI)
– MHI requests
HOME funding to complete the rehabilitation of Mainstream Apartments, a 10-unit complex that
houses persons with developmental disabilities and incomes below 30% of area median income.
MHI seeks $46,200 in funds to replace the roof, gutters, doors, safety railing, exterior paint, and to
install an intercom system. Mainstream also requests $100,000 in funding to pay down a portion of
a $216,000 loan on the property. Mainstream Apartments is currently owned and operated by MHI.
Previously, MHI requested an $87,870 HOME grant for rehabilitation costs associated with
Mainstream Apartments.
RELATED CITY POLICIES
The City Council has established a priority to address Homelessness in Eugene. Three of the four
proposed developments directly support this objective by creating more housing that will be affordable
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to very and extremely low-income families and individuals. In particular, the new development of
housing on Highway 99 will offer a critical resource for ex-offenders to help them establish stable
housing and employment upon release from prison.
The City of Eugene affordable housing development programs support a number of the City Council
Adopted Growth Management Policies. The recommended projects directly support the following
growth management policies:
Promote construction of affordable housing
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Encourage in-fill, mixed-use, redevelopment, and higher density development
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Improve the appearance of buildings and landscapes
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Increase density of new housing development while maintaining the character and livability of
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individual neighborhoods
Provide for a greater variety of housing types
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The City Council has established a Housing Dispersal Policy which seeks to maximize housing choice
for low-income families and integrate housing throughout the City of Eugene. All projects will be
located in appropriate Census Tracts according the Housing Dispersal Policy.
COUNCIL OPTIONS
The City Council has three options:
1.Approve funding for all four projects as proposed.
2.Approve funding for one or more of the projects as proposed.
3.Decline to approve funding for all projects.
CITY MANAGER’S RECOMMENDATION
The City Manager recommends Option #1: Approve use of HOME funding and other resources for the
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following projects as proposed: SVdP proposal for 1880 West 11Avenue; Sponsors proposal for
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Highway 99; NEDCO proposal for 2 Avenue and Blair Boulevard; and MHI proposal for 433 West 8
Avenue.
SUGGESTED MOTION
Move to approve use of HOME funding and other resources for the following projects as proposed:
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SVdP proposal for 1880 West 11Avenue; Sponsors, Inc. proposal for Highway 99; NEDCO proposal
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for 2 Street and Blair Boulevard; and MHI proposal for 433 West 8 Avenue.
ATTACHMENTS
A. List of Allocations Committee Members and Housing Policy Board Members
FOR MORE INFORMATION
Staff Contact: Stephanie Jennings, Housing Finance Analyst
Telephone: 682-5529
Staff E-Mail: Stephanie.a.jennings@ci.eugene.or.us
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ATTACHMENT A
Allocations Committee Members
Norton Cabell (chair)
Brita Fischer
Rick Sorric
Carmen Urbina
John Wagner
Jim Welsh
Housing Policy Board Members
Norton Cabell
Roxie Cuellar
Brita Fischer
Bobby Green, Lane County Commissioner
Dave Ralston, City of Springfield Councilor
Jennifer Solomon, City of Eugene Councilor
Virginia Thompson
John VanLandingham
John Wagner
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