COUNTY OF SAN MATEO

Inter-Departmental Correspondence

Department of Housing

DATE:

April 29, 2010

BOARD MEETING DATE:

May 11, 2010

SPECIAL NOTICE/HEARING:

None

VOTE REQUIRED:

Majority

TO:

Honorable Board of Supervisors (Sitting as the Board of Commissioners of the Housing Authority of the County of San Mateo)

FROM:

Duane Bay, Director, Department of Housing
William Lowell, Executive Director, Housing Authority

SUBJECT:

Executive Summary – Adopt Resolutions authorizing the Housing Authority of the County of San Mateo to submit an application to the Department of Housing and Urban Development (HUD) to remove El Camino Village and Midway Village from Public Housing status, and the Department of Housing to establish a Housing Authority affiliated not-for-profit organization.

RECOMMENDATION:

1. Adopt Resolution No. 2010-04 authorizing the Executive Director of the Housing Authority to submit a Disposition Application to the Department of Housing and Urban Development (HUD) to remove El Camino Village and Midway Village from Public Housing status; and

2. Adopt Resolution No. 2010-05 authorizing the Director of the Department of Housing to establish a Housing Authority not-for-profit affiliate, San Mateo County Housing Authority, Inc. (SAMCHAI).

BACKGROUND/DISCUSSION:

Following extensive research, public meetings and Board consultations, the Housing Authority is prepared to submit an application to HUD that will enable the conversion of its two Public Housing developments, El Camino Village (30 units) in unincorporated Colma, and Midway Village (150 units) in Daly City, from public housing status to a project-based model funded by Section 8 vouchers. Execution of this strategy will increase revenue for the developments by approximately 50% and enable greater housing choice by residents, as the voucher program allows voucher-holders to utilize their vouchers anywhere in the United States.

Section 18 of the National Housing Act of 1937 authorizes public housing agencies to dispose of public housing as a strategy to address issues associated with financial unsustainability, as in the case with El Camino and Midway Villages. Before HUD will formally review the disposition application, the Board of Commissioners is required to approve a resolution authorizing the application to HUD. Also, HUD does not permit public housing properties to be disposed directly to the local housing authority. Rather, housing ownership must be transferred to another entity, such as a controlled not-for-profit instrumentality or another nonprofit organization. As such, the Board is further requested, by a separate resolution, to authorize the establishment of a Housing Authority-controlled instrumentality. Once the application is approved by HUD and the not-for-profit has been established, the Housing Authority will present the Board with a request to approve the specific terms of the real estate transfer to the controlled not-for-profit affiliate.

FISCAL IMPACT:

There is no Net County cost associated with the actions requested herein. All funding related to these actions will come from the Housing Authority’s HUD funding allocations. Project-based vouchers will provide approximately 50% more income per unit compared with public housing rent and subsidies. It is estimated that under the proposed change in funding model, income at Midway Village will increase approximately $720,000/year and income at El Camino Village will increase approximately $144,000/year.