HomeMy WebLinkAbout07 NOTICE OF TRUSTEE'S SALE - AFFORDABLE HOME AT 27 LOOK OUT LANEAgenda Item
Reviewed:
AGENDA REPORT City Manager
Finance DirectorN A
MEETING DATE: NOVEMBER 3, 2015
TO: JEFFREY C. PARKER, CITY MANAGER & HOUSING AUTHORITY
EXECUTIVE DIRECTOR
FROM: TUSTIN HOUSING AUTHORITY
SUBJECT: TRUSTEE'S SALE — AFFORDABLE HOME LOCATED AT 27
LOOK OUT LANE
SUMMARY
The Tustin Housing Authority ("Authority") is seeking authorization to cure a homeowner
default under the City's Affordable Housing Program in the Tustin Field I development.
RECOMMENDATION
It is recommended the Tustin Housing Authority Commission authorize the Tustin
Housing Authority purchase the low income affordable housing unit at 27 Look Out Lane
during the Trustee's Sale (on or about November 9, 2015), and also authorize the
Executive Director, or his designee, execute any required documents, as may be
necessary to implement such action as recommended by the City Attorney. The price
and terms will be discussed in Closed Session.
FISCAL IMPACT
Adequate balances exist in the Low and Moderate Income Housing Asset Fund
("Housing Asset Fund") to cure the homeowner default. After purchasing the home, the
Authority will sell the home and the proceeds from the sale will be deposited back into
the Housing Asset Fund.
ALIGNMENT WITH STRATEGIC PLAN
Curing the homeowner default and preserving the Authority's affordable housing assets
contributes to Goal A of the City's Strategic Plan, enhancing the vibrancy and quality of
life in all neighborhoods and areas of the community.
Agenda Report
November 3, 2015
Page 2
BACKGROUND
A Notice of Trustee's Sale for November 9, 2015 has been issued for 27 Look Out Lane
(Tustin Field I development), a low income unit in the City's Affordable Housing
Program. The City is at risk of losing the affordable unit.
Pursuant to Health and Safety Code ("HSC") Sections 34176(c) and (d), the Tustin
Housing Authority may perform activities and use funds in accordance with applicable
housing-related provisions of the Community Redevelopment Law, including efforts to
increase, maintain and preserve the community's affordable housing supply. In the
effort to increase Tustin's supply of affordable housing, the City entered into a
Disposition and Development Agreement ("DDA") with the developer, WL HOMES, LLC,
in March 2003 for the Tustin Field I development. The DDA required the developer to
provide 78 affordable units within the 376 unit development with the affordability
requirements secured by long term covenants for a 45-year period.
In order to preserve the Authority's asset, it is necessary to purchase the unit prior to
losing the 45-year affordability requirement and the value of the Authority's Promissory
Note through foreclosure. Upon purchase, the Authority will actively market the
property.
HSC Section 34176(d) created the Housing Asset Fund to provide communities with a
limited funding source for increasing, maintaining, and preserving the affordable
housing supply. There is an adequate fund balance in the Housing Asset Fund to
ensure the unit at 27 Look Out Lane remains an Authority asset. Given the unit is
already priced at an affordable level as a result of existing restrictions, the costs
associated with any exercise of the City's option rights will be far less than the cost of
acquiring and replacing the affordable ownership unit.
Staff is available for any • estions the Commission may have.
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Jerry Craig die.
Economic,revelo• erg 'ousing Manager
Tustin Ha •sin. ' uthority