COUNTY OF SAN MATEO

Inter-Departmental Correspondence

Department of Housing

DATE:

April 20, 2006

BOARD MEETING DATE:

May 2, 2006

SPECIAL NOTICE/HEARING

10-Day Publication, Public Hearing

VOTE REQUIRED

Majority

TO:

Honorable Board of Supervisors

FROM:

Duane Bay, Director, Department of Housing

SUBJECT:

Executive Summary for Submission of Application to the U.S. Department of Housing and Urban Development for a Section 108 Loan to Assist the Development of the Colma Transit Village Apartments

Recommendation

A.

Conduct a public hearing; and

B.

Adopt a Resolution:

1.

Amending the FY 2005-2006 Action Plan to the San Mateo County Community Development Block Grant Program; and

2.

Authorizing submission of an application to the U.S. Department of Housing and Urban Development for Section 108 loan guarantee funds for the development of the Colma Transit Village Apartments; and

3.

Designating the Director of the Department of Housing to execute documents with HUD in connection with the Section 108 Loan.

Background

BRIDGE Housing Corporation, through its affiliate nonprofit, BRIDGE Regional Partners, is developing 130 units of family housing adjacent to the Colma BART Station. In FY 05-06, the County approved $500,000 of Community Development Block Grant (CDBG) funds to assist in predevelopment. At that time, BRIDGE, indicated it would request additional funding over the next two years to further project development. BRIDGE is requesting that the County apply for a HUD Section 108 loan for up to $7.145 million.

Discussion

On February 23, 2006, the Housing and Community Development Committee (HCDC), the pubic advisory body to the Board of Supervisors on CDBG matters, met to review BRIDGE’s request for a Section 108 loan. Section 108 is a loan guarantee program that provides local communities with augmented funding for housing and community development activities. The HCDC supports the project but had concerns over Section 108 loan repayments and the long-term impact on the CDBG Program. In particular, the Subcommittee recommended that future CDBG funds pledged for repayments on the Section 108 loan be limited to the annual 45% portion allocated for housing.

Fiscal Impact

No Net County Cost will be affected by the requested actions.