COUNTY OF SAN MATEO

Inter-Departmental Correspondence

Human Services Agency

Office of Housing

DATE:

BOARD MEETING DATE:

6/29/2004

TO:

Honorable Board of Supervisors

FROM:

Maureen Borland, Human Services Agency

Steve Cervantes, Director, Office of Housing

SUBJECT:

First Amendment to the Agreement with the City of East Palo Alto Redevelopment Agency

Recommendation

Adopt a Resolution Authorizing the Execution of a First Amendment to the Agreement with City of East Palo Alto Redevelopment Agency (The City), amending the down payment assistance and types of property eligible for purchase on the Comprehensive Homebuyer Assistance Mortgage Program (CHAMP).

Background

The CHAMP provides down payment assistance in the form of low-interest long-term second and third mortgage loans to eligible first time homebuyers. First-Time Homebuyers are selected from the City’s Central Wait List.

The City has appropriated $126,300 to assist three or more families in purchasing a home in the City of East Palo Alto. The County of San Mateo has appropriated $126,300 in matching funds to assist three or more additional families in purchasing a home in the City of East Palo Alto. The City applied and was awarded HOME funds in Fiscal Year 2001-02 to supplement their own funds for First-Time Homebuyers, however, due to the high turn over within their staff, the City was unable to execute an Agreement with the County to implement the CHAMP until March 2004.

Discussion

The City committed to match funds as a condition of receiving HOME funds for its CHAMP program. Initially, loans were to be disbursed in an alternating fashion in the form of a down payment assistance not to exceed $42,100, or 24% of the purchase price (whichever is less), per family with the City funding the first down payment assistance loan. The City has now requested to change the amount from the lesser of 24% of the purchase price or $42,100, to 10% of the applicable Below Market Rate (BMR) sales price. In addition, the property requirements are being changed to exclude manufactured home or mobile homes from the single-family residence qualification.

This First Amendment has been reviewed and approved as to form by County Counsel. Risk Management reviewed and approved the contractor’s insurance coverage.

Vision Alignment

The Agreement with the City keeps the commitment of: Offer a full range of housing choices; and goal number 9: Housing exists for people of all income levels and for all generations of families. The Agreement contributes to this commitment and goal by providing affordable housing to a spectrum of the population who would otherwise not be able to afford housing in the immediate vicinity.

Fiscal Impact

The total obligation under this First Amendment remains $126,300, which is funded 100% by the HOME funds. The term of this Agreement is from 3/1/2004 to 6/30/2006. This project is included in the Housing Budget for FY 2003-04 and the Recommended Budget for FY 2004-05. There is no Net County Cost.