1. Housing and Career Services Department CITY COUNCIL Housing Grant Agreement Community Arms, LP Security Upgrades Project James Wong, Senior Project Planner August 15, 2016

2. Housing and Career Services Department Recommendation Find that the Community Arms security upgrades project does not have a significant environmental effect and is categorically exempt under CEQA “Existing Facilities” Approve key business terms of Housing Grant Agreement with Community Arms LP (“Owner”) Approve carry forward of $420K PY 2015 HOME funds and amend Housing Dept’s FY 2017 budget by appropriating $43K Inclusionary funds Authorize City Manager to enter into Housing Grant Agmt with Owner in amount of $463K 2

3. Housing and Career Services Department Background Community Arms is a 133-unit apartment complex located at 151 E. Orange Grove Blvd, built in 1973 as a HUD very low income rental project Owned by Community Arms LP, formed in 2002 The General Partner of the LP is Community Bible Community Development Corp, a nonprofit housing organization In 2014, Owner submitted a CDBG funding application in the amount of $50,000 to purchase and install a security camera system 3

4. Housing and Career Services Department Background The 2014 CDBG application was not funded, but Housing Dept. commenced efforts with Owner and Police Dept. to develop a comprehensive program of site upgrades to enhance the safety and security of the residents at Community Arms and of the surrounding neighborhood After numerous discussions and site visits over an 18-month period, Owner submitted an updated funding proposal in January 2016 and a revised, final proposal in early-August 2016 4

5. Housing and Career Services Department Background Project Budget 5 Security UpgradeAmount Camera System$ 93,000 Lighting$ 90,000 Gates, Fencing$ 60,000 Electrical$ 65,000 Landscaping$ 55,000 Contingency$ 36,000 Project Management$ 64,000 (14% max) TOTAL$463,000

6. Housing and Career Services Department Background City funds are proposed to be structured as a grant to facilitate Owner’s plans to restructure the LP ownership entity and refinance existing debt Funding will not exceed $463,000: $420,000 federal HOME and $43,000 Inclusionary funds Section VII of Inclusionary Housing Regulations provides that Inclusionary funds may be used to provide financial assistance for, among other things, the rehabilitation of low and moderate income affordable housing. 6

7. Housing and Career Services Department Background On 3/14/16 City Council approved the allocation of $420,000 PY 2015 HOME funds for the project The deadline for City and Owner to enter into the Housing Grant Agreement is 8/31/16, otherwise, $420K HOME funds will be recaptured by HUD. 7

8. Housing and Career Services Department Grant Agreement-Key Terms City grant funding shall not exceed $463,000 Scope of work: installation of security camera system; gates, gate control and fencing; security lighting; landscaping; and project management. City shall disburse funds subject to approval of Owner’s monthly draw requests based on certified vendor invoices for work and materials Four-month schedule of performance Project shall be subject to City’s local hiring policy Compliance with federal HOME regulations 8