The Yuba City Council on Tuesday unanimously approved measures to continue housing programs that were scrapped by the Regional Housing Authority earlier this year and are intended to benefit low-income residents. and improving their homes.
Led by Executive Director Gustavo Becerra, the Regional Housing Authority sent letters to affected jurisdictions informing them of the agency’s decision to no longer participate in a program that helped facilitate deferred loans that were essential to help low-income individuals and families to rehabilitate their homes. , the call previously reported.
Once this decision was made, jurisdictions were forced to turn to other agencies to continue these beneficial programs.
“The city has been a recipient of the HOME Investment Partnership Program (HOME), CalHome funding and the Community Development Block Grant (CDBG) program for several years,” the city said in a staff report. “These funds enabled the city to run two housing loan programs for Yuba City residents; Home Ownership Loan Scheme (FTHB) and Owner Occupied Housing Rehabilitation Loans (OOR). These programs offer homebuyers and owners with qualifying income the opportunity to obtain low-interest loans for the purchase or renovation of affordable permanent housing.
Ben Moody, director of public works and development services for Yuba City, briefly highlighted the benefits of the FTHB and OOR programs during Tuesday’s council meeting.
“Basically two loan programs that we are looking to help low-income and income-based qualified people to help keep the housing stock in good repair and to get entry-level individuals into homes” , Moody said.
In January, the Regional Housing Authority (RHA) informed the city authorities that it would no longer provide home loan scheme services. Because of the decision, the FTHB and OOR programs were put on hold while city staff worked to find a new administrator for the programs, the city said.
Regarding rehabilitation, a former RHA employee said the agency would contract with any given jurisdiction and when funds were available, the RHA would contact organizations to get people to call and register on a waiting list that would allow them to repair or improve certain parts of their house.
The former employee said health and safety improvements were usually the most important items that needed attention, with energy conservation, building code violations and general home improvements being also requested, the call had previously reported.
Once registered, the ORS would manage this list and help facilitate the improvement process. The former employee said the RHA would accept a loan package it created for a jurisdiction and that jurisdiction would lend the money.
The person said a landlord would sign a deferred payment contract with simple non-compound interest. Payment would only be due if the owner moved or died or at the end of 30 years, the former employee said. If necessary, the payment period could be extended.
In his letter to Yuba City, Becerra said, “Following recent personnel changes at the Regional Housing Authority, we regret to inform you that [sic] informing you that we are terminating the intergovernmental agency agreement entered into on November 19, 2019 between the city of Yuba and the regional housing authority. Termination shall be effective thirty (30) days from the date of this letter, on which date all administrative services for the Housing Rehabilitation and Home Purchase Assistance Program will cease and all records and/or relevant files will be returned to the city. All final invoices will also be submitted to the city no later than March 7, 2022.”
Moody’s previously said that because of the RHA’s decision, the city should seek out other organizations to help administer the program that helped low-income homeowners.
“In the short term, the change impacts pending applications and waitlists of eligible potential residents,” Moody previously said in an email to the call. “However, in the long term, the city is currently contacting other consultants/organizations to see if they can help run the program on behalf of the city. In addition, staff are exploring options to potentially modify existing Community Development Block Grant (CDBG) programs to administer similar rehabilitation projects for eligible residents, i.e., seniors, people with disabilities and people who earn less than 80% of the average area. Income.”
When the appeal reached out to Becerra for comment on what the RHA was doing and their decision to no longer help administer rehab programs, they simply said it wasn’t cost-effective.
“Individual cities and counties still have the power to administer them on their own behalf. The decision to terminate our administration of these programs is purely fiscal, the authorized fees are not sufficient to cover personnel costs (salaries/benefits),” Becerra previously said in an email to the call. “Our other low-income properties and programs have had to subsidize these administrative costs. This reduces our ability to replace roofing, flooring, appliances, etc. to provide quality housing for our most vulnerable residents.
Due to the RHA’s decision, Yuba City had to figure out what to do next.
“We’ve put those funds on hold to try to figure out, OK, what are the next steps, who can be a vendor, who is able to run this program, and how are we going to move forward,” Moody said Tuesday. “There has been outreach to potential housing providers, such as Mercy Housing. We contacted different agencies. … I’m just finding out what we’re going to do for the next steps.
Moody’s said the economy and construction and housing prices, as well as other factors, made it difficult for the city to “move these loans and get them off the books.” He also said that due to funding restrictions it “was difficult to administer and repay for this period”.
On Tuesday, the Yuba City Council passed a resolution authorizing City Manager Diana Langley to enter into a “subrecipient agreement” with Habitat for Humanity Yuba-Sutter to administer the city’s housing loan programs. .
“The subrecipient agreement outlines a total of approximately $922,000 in program funds available for home loans, with a maximum of $153,324 of those existing loan funds available for repayment costs associated with the home loan. administration of loan programs (if all available funds are loaned),” the city said in reference to the fiscal impact the programs will have. “These numbers are based on existing fund balances and maximum percentages that state or federal loan program regulations allow for use for administration Funds paid to Habitat will come directly from loan program balances, with funds applicable to the provision of activities only eligible for reimbursement after the successful granting of a loan.
In total, the city said $75 per hour up to $12,500 can be used for “general administration with a maximum of 21% for HOME loan program funds, 17% for CDBG and/or or 15% of CalHOME loan program funds to be used for activity delivery costs, when staff time is used for a funded loan project, must be paid to Habitat for Humanity from existing loan balances .
The agreement with Habitat will expire on Dec. 31, 2024. After that, the city and Habitat have the option to extend the agreement for an additional three years with updated loan fund balances, the city said.
“I think I want to thank Habitat for Humanity for stepping up and taking over this program,” said Yuba City Council member Marc Boomgaarden. “I know RHA and what happened with them leaving the program…so thank you for being a partner. It is something important.