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Home My WebLink AboutABOUT THE ORANGE COUNTY HOUSING FINANCE TRUST PRESENTATION - 5.7.19ABOUT THEORANGE COUNTYHOUSING FINANCETRUST May 7,2019 What is a HousingTrust? •Housing trustsare: •Repositories for funds to construct affordablehousing. •Established by state, city, or countygov’ts •The funds for the Trusts comefrom: •Voter-approved bonds (like Prop1) •Private donations (Disney = $5M to The Other HousingTrust) •Dedicated, long-term funding streams (SB 2 funds, other housing funds like developer fees, General Funds,other) •There are >700 city and county housing trust funds across US, over a dozen major ones in California (Housing Trust of Silicon Valley is a bigone) About the OC Housing FinanceTrust •Formed via AB 448 (Daly,2018) •As adopted, AB448: •AllowstheCounty ofOrangeandOCCitiesto formtheOCHousingFinanceTrust (OCHFT) •Says that the Trust Governing Board must be electedofficials •Says that the Trust can receive then allocate funds for supportive housing and affordable housing (low-andmoderate-income) •Says that funds can be grants, loans, bond moneys, city funds, private donations,more. •Says that Trust cannot own housingprojects. Key Distinctions: Bylaws v.JPA ProposedBylaws •Not approved yet – must be approved by GoverningBoard •Calls out GovernanceStructure •Four County electedofficials •Five City electedofficials: •One (largest city) from eachSPA •One from med-size city(60K-95K) •One from small city(<60K) •Advisorybody Joint PowersAgreement •Document is final, unless amended by allparties •Governing Board does nothave populationdelineation. •Why? •Populations change over time, and so coulddelineations. •Much easier to amend bylaws then JPA Document due to the latter’s recirculation requirement. How OC Housing FinanceTrust is Formed County agreed toJPA (March12) Nine citiesthen joined • Fullerton • BuenaPark • Orange • CostaMesa • GardenGrove • LagunaNiguel • MissionViejo • NewportBeach • FountainValley Morecities join (tonight = Tustin, Anaheim, San Juan Capistrano) For those who join by May 30 ,City Selection Committee meets and names City reps (w/in parameters) Firstmeeting of Trust Gov Board (June 2019) And Once it’sFormed… Trust seeks/applies for Prop 1 and other funds Trustissues calls for projects (Fall2019?)Trust personnel review & recommend Projects broughtto Trust Gov Board for vote Projects get funded (late 2019orearly 2020?) MajorIssues/Questions Can Debt be Issued byTrust? •No. Hiring ofStaff •Can only hire contractors. •County to cover first year costs. •County’s goal is to use Prop 1 and other grant funds for portion/all of admincosts. More aboutCost What could keep costsdown: •Get qualified contractpersonnel. •Have a Trust member city “host”the Trust in a CityHall. •Or Trust uses WeWork space orsimilar •Trust secures Prop 1 funds to not only fund projects, but pay foradmin. What’sunknown: •How many cities will join (determines what each might contribute) •Amount of Prop 1 funds to offset admin •What will the cost apportionment processbe? •Will qualified contractors do this? At whatexpense? Cost Scenarios (estimates) – part 1 of2 Scenarios #ofCities thatJoin HigherCost/Yr ($350,000) ModerateCost/Yr ($225,000) LowerCost/Yr ($150,000) Scenario1 $100K Prop 1 AdminFunding $ 100,000 $ 100,000 $ 100,000 County ofOrange $ 111,111 $ 55,556 $ 22,222 28 CitiesJoin $ 138,889 Dues perCity $ 69,444 Dues perCity $ 27,778 Dues perCity -- LargeCities 8 $ 66,335 $ 8,292 $ 33,167 $ 4,146 $ 13,267 $ 1,658 -- MediumCities 15 $ 62,189 $ 4,146 $ 31,095 $ 2,073 $ 12,438 $ 829 -- SmallCities 5 $ 10,365 $ 2,073 $ 5,182 $ 1,036 $ 2,073 $ 415 Scenario2 No Prop1Admin Funding $ - $ - $ - County ofOrange $ 155,556 $ 100,000 $ 66,667 28 CitiesJoin $ 194,444 Dues perCity $ 125,000 Dues perCity $ 83,333 Dues perCity -- LargeCities 8 $ 92,869 $ 11,609 $ 59,701 $ 7,463 $ 39,801 $ 4,975 -- MediumCities 15 $ 87,065 $ 5,804 $ 55,970 $ 3,731 $ 37,313 $ 2,488 -- SmallCities 5 $ 14,511 $ 2,902 $ 9,328 $ 1,866 $ 6,219 $ 1,244 Cost Scenarios (estimates) – part 2 0f2 Scenarios #ofCities thatJoin HigherCost/Yr ($350,000) ModerateCost/Yr ($225,000) LowerCost/Yr ($150,000) Scenario3 $100K Prop 1 AdminFunding $ 100,000 $ 100,000 $ 100,000 County ofOrange $ 111,111 $ 55,556 $ 22,222 15 CitiesJoin $ 138,889 Dues perCity $ 69,444 Dues perCity $ 27,778 Dues perCity -- LargeCities 3 $ 52,083 $ 17,361 $ 26,042 $ 8,681 $ 10,417 $ 3,472 -- MediumCities 8 $ 69,444 $ 8,681 $ 34,722 $ 4,340 $ 13,889 $ 1,736 -- SmallCities 4 $ 17,361 $ 4,340 $ 8,681 $ 2,170 $ 3,472 $ 868 Scenario4 No Prop 1Admin Funding $ - $ - $ - County ofOrange $ 155,556 $ 100,000 $ 66,667 15 CitiesJoin $ 194,444 Dues perCity $ 125,000 Dues perCity $ 83,333 Dues perCity -- LargeCities 3 $ 72,917 $ 24,306 $ 46,875 $ 15,625 $ 31,250 $ 10,417 -- MediumCities 8 $ 97,222 $ 12,153 $ 62,500 $ 7,813 $ 41,667 $ 5,208 -- SmallCities 4 $ 24,306 $ 6,076 $ 15,625 $ 3,906 $ 10,417 $ 2,604 Why is the Board the way itis? • Result ofnegotiations • County (4/9ths) argued that County carries with itmost of thefunding. • Cities (5/9ths) argued that cities are the sites for mostof thehousing. •Must beelectedofficials(requiredbyAB448) Are there two housingtrusts? Public Trust (OCHFT) •Activated by AB448 •Will aggressively seek Prop 1 funds, but can take other public and private funds •Public sector governingBoard •More likely to GRANT funds for supportive housing projects – no recovery ofgrants Private Trust(OCHT) •Run through NeighborWorksOC •Receives privatedonations •Private sector governingBoard •Generally focuses on LOANS to secure home ownership, recovery of principal Can a city leave thetrust? •Yes… •Nodebt •Contractstaff •JPA documentsays: •Leaving the Trust voluntarily requires six (6) months’ notice via an action by the CityCouncil. What money will the Trust likelyhave? •Mostlikely: •Prop 1 (Nov 2018 bond -$300M just for Housing Trustsstatewide) •Cities’ SB 2 funds (from willingcities) •Privatedonations •Probablynot: •County MHSA Funds,but… •County has pledged up to $70M to be made available to Trustprojects Therefore, there could be as much as $150M available for supportive housing within a year or so (Prop 1 + CountyMHSA) Major Issues/Questions(cont’d) Does joining the Trust mean Ihave to come to the table with project money? •No –JPA specifically precludes requiring any member to promise project/housing funds as a condition for joining (Sec 3(c)(5) ofJPA). Does joining the Trust mean I have to come to the table with promises ofunits? •No. JPA specifically precludes requiring any member to promise units as a condition for joining (Sec 3(c)(7) ofJPA). Will joining the Trust help us with our Regional Housing Needs Assessment (RHNA)numbers? • Twoanswers: •Yes,ifthecity plansto usetheTrust’sfundstobuild units in thecommunity. • Probably not, though, if a city intends to contribute money to the Trust and try to get credit when theunits are built outside the community (unless the law changes) Reasons to Join (in order, and opinionsonly) 1.My city wants to see more supportive housing projects built in ourcommunity. 2.We’ve got $$ we want to put into a regional solution. 3.We really are not sure what we want yet, but we’re sure we don’t want to be left out or to not participate.