|
|
STRATEGIC OUTCOMES |
ACTION |
|
Department: |
☒ Safe & Prosperous |
☒ Motion |
|
Planning & Neighborhood Svc |
☐ Active & Appealing |
☐ Resolution |
|
|
☐ Respected & Responsible |
☐ Ordinance - Introduction |
|
Division: |
☐ Connected & Engaged |
☐ Ordinance - Adoption |
|
Neighborhood Services |
☐ Unique & Creative |
☐ Public Hearing |
TITLE: t
Development Loan Agreement: Arizona Housing Development Corporation
end
SUMMARY RECOMMENDATION: Summary Recommendation
Approve a Development Loan Agreement with Arizona Housing Development Corporation for the Magnolia Gardens Project funded by the U.S. Department of Housing and Urban Development’s HOME Investment Partnership and HOME-ARP Programs. (Planning and Neighborhood Services/Neighborhood Services) (Cynthia Blot)
end
STRATEGIC OUTCOME:
The use of funds provided in this agreement furthers the City Council’s strategic outcome of Safe and Prosperous by providing resources to meet the housing needs of the community.
REPORT:
HOME-ARP
The American Rescue Plan (ARP) was signed into law on March 11, 2021, providing federal funding to address the ongoing impact of the Coronavirus Pandemic on the national economy, public health, state and local governments, businesses, and citizens. To address these needs, Congress allocated ARP funding to be administered by the U.S. Department of Housing and Urban Development (HUD) as part of the department’s HOME Investment Partnerships Program (HOME-ARP). HUD provided these funds to the Yuma County HOME Consortium (YCHC). The members of the YCHC are Yuma County, the Cities of Somerton, San Luis, and Yuma, and the Town of Wellton. The City of Yuma serves as the lead entity for the consortium.
In 2022, staff engaged in an extensive consultation process to develop the HOME-ARP Allocation Plan. This consultation resoundingly instructed that the funds to be used to develop affordable rental housing. City Council approved the Plan on July 11, 2022 before it was submitted to and approved by HUD. The Plan allocated funds for the development of affordable rental housing for certain qualifying populations and HOME-ARP Planning and Administration.
In 2022, the City issued a Notice of Funds Availability (NOFA) to accept proposals from developers interested in developing affordable rental housing. Three proposals were submitted:
- DANCO Communities to develop a 60-unit (10 HOME-ARP units) Fortuna Palms Project at the NWC E. 35th Place & South Prescott Avenue in the Foothills. The project was not approved for Low Income Housing Tax Credits by the Arizona Department of Housing and did not move forward.
- Bethel Development to assist with the Vistara Phase I project in the Mesa Heights Neighborhood to develop an 80 unit (1 HOME-ARP unit).
- Arizona Housing Development Corporation (AHDC) to assist with the Magnolia Gardens project at 430 S. Magnolia Avenue to develop 16 units. The project includes 8 HOME-ARP units, 2 HOME units and 6 market rate units.
In 2023, the YCHC approved $2,321,108.60 in HOME-ARP funding for the Magnolia Gardens project.
HOME
Each year, the YCHC is required to set aside at least 15% of the HOME allocation for eligible Community Development Housing Organization (CHDO) activities under the HOME Program. AHDC meets the qualifications and is certified as CHDO by YCHC. YCHC approved the following HOME funds to develop 2 HOME units (listed above) in the Magnolia Gardens project:
2021/2022 - $ 124,935.00
2022/2023 - $ 99,586.34
2023/2024 - $ 322,438.66
2024/2025 - $ 33,326.00
$ 580,286.00
By this action, City Council authorizes the City Administrator to execute a Development Loan Agreement and associated documents in substantially the form attached on behalf of the Yuma County HOME Consortium providing $2,321,108.60 in HOME-ARP and $580,286.00 in HOME funds totaling $2,901,394.60 to develop the Magnolia Gardens Apartment project. The no-interest loan will have a 20-year term and must meet all HOME and HOME-ARP requirements throughout this period. After the 20-year period of affordability on 10 of the 16 units, the loan will be forgiven.
FISCAL REQUIREMENTS:
|
CITY FUNDS: |
$ 0.00 |
BUDGETED: |
$ 2,901,394.60 |
|
STATE FUNDS: |
$ 0.00 |
AVAILABLE TO TRANSFER: |
$ 0.00 |
|
FEDERAL FUNDS: |
$ 2,901,394.60 |
IN CONTINGENCY: |
$ 0.00 |
|
OTHER SOURCES: |
$ 0.00 |
FUNDING: ACCOUNT/FUND #/CIP |
TOTAL $ 0.00
|
163-30-30 167-30-30 |
|
|
To total; right click number & choose “Update Field” |
|
FISCAL IMPACT STATEMENT:
None
ADDITIONAL INFORMATION:
SUPPORTING DOCUMENTS NOT ATTACHED TO THE CITY COUNCIL ACTION FORM THAT ARE ON FILE IN THE OFFICE OF THE CITY CLERK:
HOME-ARP Allocation Plan
IF CITY COUNCIL ACTION INCLUDES A CONTRACT, LEASE OR AGREEMENT, WHO WILL BE RESPONSIBLE FOR ROUTING THE DOCUMENT FOR SIGNATURE AFTER CITY COUNCIL APPROVAL?
☒ Department
☐ City Clerk’s Office
☐ Document to be recorded
☐ Document to be codified
|
Acting City Administrator: |
Date: |
|
John D. Simonton |
04/08/2025 |
|
Reviewed by City Attorney: |
Date: |
|
Richard W. Files |
04/08/2025 |