Successor Agency to the Redevelopment Agency of Santa Rosa - Regular Meeting

Noted on the city's website and is noted on the agenda. As a matter of housekeeping, I'd like to remind commissioners to keep their microphones muted unless they are speaking. Clerk, can you explain how public comments will be heard at today's meeting?

After each agenda item, the Chair will ask for Housing Authority Commissioner comments, and then we'll open the item for public comment. Once the Chair calls for public comment, please go to the closest podium in the upper tier of chambers. The Clerk will unmute your microphone and start the timer. Speakers will be allowed to speak one time per item, up to three minutes. Additionally, there is one public comment period to speak on non-agenda matters, item six. To address the housing authority, you are requested to complete a speaker card and give it to the recording secretary. Based on our number of members of the public today, I do not believe we will have speaker cards out.

Clerk, have we been notified of any commissioners who have requested to participate remotely under the just cause provision of the Brown Act?

We have not.

Okay, okay, okay. And there are no other commissioners remotely?

OK. OK.

Before I ask the clerk to do a roll call for attendance to assist with streaming the meeting and capturing commissioners as they're speaking, I want to continue to remind commissioners to please ask the chair to be recognized before asking a question or making a comment. This will allow the cameras to shift to a new speaker. Can you do the roll call, please?

Commissioner Fearon? Present. Commissioner Wimmer.

Here.

Commissioner Conte.

Here.

Vice Chair Capio.

Here.

Chair Smith. Here. Let the record reflect that all commissioners are present with the exceptions of Commissioner Downey and Owen.

We'll go on to item four, statements of abstention. Are there any statements of abstention from any of the commissioners? Okay, there are none. We'll move on to item five, study session. There are no study session items on this agenda, no need for public comment. And item six, public comments on non-agenda items. A comment from the public will be allowed on all agenda items at this time each item is called. This is the time when any person may address the Housing Authority on matters not listed on the agenda, but are within the subject matter jurisdiction of the Housing Authority. Each speaker will be allowed up to three minutes to address the Housing Authority. You are requested to complete an orange speaker card and give it to the recording secretary.

We are now taking public comments on item six, non-agenda items. This is the time when any person may comment on matters not listed on this agenda, but which are within the subject matter jurisdiction of the Housing Authority. If you wish to make a comment, please go to one of the podiums in the upper tier of chambers. You will have three minutes and a countdown timer will alert you at the end of that period. Please state your name for the record if you choose to do so.

There's no cards here, so I'll just go from here. Hello, Commissioners and staff. My name is DeWayne DeWitt, I'm from Roseland. I came to thank you all for volunteering to do this very important job. And also thank you for having a subcommittee on what are known as the Housing and Urban Development, Veterans Affairs, Supportive Housing Vouchers. This program is a very good program, and I do believe that here in Sonoma County, where it's administered by Santa Rosa staff, it could actually step up to be one of the best run programs in the entire nation. And you could perhaps look at yourself as a template, as a model for how to pull together the disparate agencies that are involved and have them become more coordinated and collaborate better to actually get the vouchers into the hands of needy veterans as soon as the veterans qualify within the system. One of the dilemmas that's been faced for decades has been a lack of coordinated collaboration, if you will. I wanna point out that there's a really good opportunity now because the federal employee that was handling this for the San Francisco region retired. You may have had a chance to speak with her already, but she lives in my neighborhood of Roseland. And I do believe that you could reach out and begin an ongoing conversation with this person especially now that she's able to speak more forthright and not have to avoid some of the restrictions in place of being employed by the federal government. Her name is Kim Valadez, and Kim Valadez is truly a good person who was trying to do a good job during the time she was with the federal government. If you have difficulty connecting with her, you can find her every Friday morning at the South Santa Rosa Community-Based Outpatient Clinic from 11 in the morning until one o'clock, where she's there to talk with veterans about making sure they get their benefits. And letting the rest of the community know that folks do not want to see cutbacks. They do not want to see clawbacks from the federal government on Veterans Affairs financing. They actually want to see more opportunities given to the veterans. So please, the subcommittee that you have, expand it. Perhaps get Mr. Fearon involved also. Although I do believe that that might make it a regular committee. if you had that many members. But hey, you're already getting the money for that committee. The opportunity to make it even more vibrant with a larger membership would be quite helpful. And I know there's volunteers who would volunteer to come to interviews with you. Thank you.

Whenever you're ready.

I'm ready. Good afternoon, Housing Authority. My name is Dana Gutierrez, and I live at South Park Common apartment in Santa Rosa, California. I am a survivor of domestic violence. For 20 years, I was a victim, and now I'm a survivor. I fled my abusive relationship in 2020. I fled with only the clothes on my back and leaving behind my home, my belongings, and my children to save my life. I became homeless. I was later housed through the Housing and Disability Advocacy Program called HDAP. Because my disability application is still pending, That program ends in September and I am terrified of becoming homeless again before my disability benefits are approved. Since moving into my apartment, I have experienced repeated break-ins, my door has been damaged, my belongings have been stolen, and I have filed numerous police reports, but I feel nothing has been done. I was also sexually assaulted in my apartment while I was sleeping. I went to the hospital and the police report, I made a police report and requested an emergency transfer, but I was told that there was no other available units. I also have concerns about excessive drug use of fentanyl, them blowing it in the vents and making the residents sick, and there's children that live there as well. I later learned that there are registered sex offenders If I would have known that before, I wouldn't have even accepted to live there. I feel that my reports have too often been dismissed instead of taken seriously. I know I am not the only resident who feels this unheard. Because of us getting SSI or living in those apartments, our credibility just went out the window. They don't believe anything we say because they say we're crazy. So every time I go to call and make a report, it's always, did you call the first response? And I'm reporting a break-in. So I just feel like, that I should feel safe in my own home and something should be done about it. Thank you.

I'm seeing no more public comment.

We're gonna move on to the next item, item seven, approval of minutes. This is just to approve the minutes from the June 15th, 2026 meeting. There's no vote on this or anything, right?

No, you can ask if anyone has any changes, and if not, we'll just approve them as submitted. Okay, anyone has any changes?

None, so we'll approve it. The drafts are approved. Any public comments on this item?

We are now taking public comments on item 7.1. If you wish to make a comment, please go to our podiums in the upper tier of chambers. You will have three minutes and a countdown timer will alert you at the end of that period. Please state your name for the record if you choose to do so.

Hello, my name is Duane DeWitt, I'm from Roseland. I do believe before you approve minutes, you should ask for the public comment. It's important that when public members come to these governmental meetings, that their statements are shown in the record somehow. Today, up here at this table where we would pick up agendas, there are no minutes here for us to look at. I know I've attended meetings in the past. There used to be a attempt on the part of Santa Rosa City staff to actually memorialize what was said by members of the public. I know they've switched up to something they call action minutes now, in which they just basically only report if they've done something. But it's still, I believe, under the state of California's viewpoint, of the Brown Act and the Bagley-Keene Act that the public's business should show when members of the public have come and participated and made statements, those statements should at least be reflected, not just say the name of the person and say, spoke. Actually give a small summary of what was said by the person And each time they speak on those items, there be a small summary. We actually have an open government task force recommendation that was put together here in the city of Santa Rosa. It's over a decade old. I hope all of you get a chance to read it. The open government recommendations are to make the information that's available to you available to the public also. So the minutes aren't here and I would have liked to have seen something because I know I've spoken a time or two in the past. Thank you for your kindness.

I'm seeing no more public comment.

We'll move on to item eight, Chairman, Commissioner reports. There are none, and so there will be no public comments. We'll move on to item number nine, committee reports. I'm sorry, I didn't see you. Commissioner Ferran.

Yeah, in a way of VASH vouchers, I just wanted to point out to Dwayne, the Dry Creek Rancheria received VASH vouchers award, I believe last week or the week before, and they've been referred to us to work in collaboration. Our experience in administering VASH vouchers I think will be tremendously important to the Dry Creek Rancheria in their new adventure. If you know of any veterans, especially who are in their tribe, they will be the beneficiary of it. I also wanted to thank Dana for her statement. It's not easy to come and reveal your own history. And in the attempt to help us understand how our programs are operating and get some firsthand testimony from people who are the residents, I very much appreciate you.

We'll go on to item number nine, committee reports. Are there any of the ad hoc committee members for the HUD-DASH and NOFA would like to report out on anything? Okay, there are nothing to report out on.

Okay.

We'll be taking any public comments now for item number nine.

We're now taking public comments on item 9.1. If you wish to make a comment, please go to the podium, one of the podiums in the upper tier of chambers. You will have three minutes and a countdown timer will alert you at the end of that period. Please state your name for the record if you choose to do so. I'm seeing no one rising.

Thank you. Item 10, the Executive Director reports on the pending development pipeline. Megan.

Thank you, Chair Smith. Before we move to the pipeline, I first would like to bring a matter to the Housing Authority's attention regarding our Housing Choice Voucher Program. In early July, we were notified by HUD staff that the program is slated to be in shortfall for 2026. This is attributable to HUD reducing our HUD-held reserves. So we had 1.26, almost 1.23 million in HUD-held reserves that HUD took back, which is pushing us into shortfall. Upon this notification, we immediately began working with HUD technical assistance, with our federal lobbyists, and have a meeting this week with HUD to appeal the offset, which is what they call the reserve reduction. So we're hopeful that by going through that process and working with our lobbyists and HUD staff, we'll be able to restore the reserves. In the meantime, while we are identified as being in shortfall, we do need to meet with HUD monthly to go over program requirements. We were already implementing many of the shortfall requirements that HUD has. such as not pulling anyone from our waiting lists, which we haven't done in several years due to our financial constraints, not issuing any requests for proposals for project-based vouchers, which we haven't done since 2021 as well, because we have met the program percentage for that aspect of the program. We have also stopped absorbing portability vouchers. We did that last year as we were evaluating our financial status. And the one measure that they do require that will possibly have some significant impacts is we will not be able to absorb any emergency housing vouchers. We currently have 97 households, and that funding ends in December of 2026. So we are trying our best right now to work with HUD staff to see if they'll restore our reserves, which will help us mitigate some of these upcoming issues. So that is the situation right now, and I'll provide you monthly updates as we navigate through this process. We are pleased that HUD was so receptive to setting up a meeting. This is with the public and Indian Housing staff so quickly after we sent our letter in. So I'd be happy to answer any questions on that particular update before we move on.

Commissioner Conte.

What's involved in reestablishing these funds? What are you discussing with HUD?

So we are going to point out the regulatory components of HUD regulations that they cannot reduce your reserves if it puts you into shortfall, which is what they have done.

Is that looking at maybe going to court? I'm sorry, what? Is that possibly having to go to court? Is it a legal issue?

No, I don't think it would be necessarily a legal issue. It's just working with HUD staff on their interpretation of the regulations and the implementation. Otherwise, we will continue to work through the shortfall process. Because this is the first time that our housing authority has been identified as being in shortfall, we're in the first group of many housing authorities nationwide, so that does put us in a much better position for our funding to be provided or restored. Additionally, we have admin reserves, so that's when they give you admin funding that you don't spend. We have that that we can use to help offset the financial reduction.

So it sounds like much of the issue is port ends and new voucher support funding, but those who are in housing established with vouchers are not at this point impacted by this shortfall.

At this particular point in time, existing Housing Choice Voucher programs are not expected to be anticipated. In more dire cases, which again is not where we're at at this point in time, potential reductions of voucher holders could be implemented. But again, we are not there at this point in time.

Okay, thank you.

The other, I think, noteworthy item to talk about is when we first met with our shortfall representative. You're assigned a specific staff member to work with as well. She did note we just popped up on their radar, so it was new to HUD as well. So we were not anticipating it, nor was HUD staff.

Okay, great, thank you.

Vice Chair Capio.

Yes, I just need to understand, make sure I understand that the reason why they took this action, was it popped up on their computer? I mean, I'm not being facetious. I just need to understand.

So with a lot of things with the voucher program, it gets a little bit complicated, but HUD uses a two-year financial modeling tool. It's called the two-year tool. And our reserves were high at the end of 2025. But in 2026, which is the duration of the two-year tool, our reserves went down to a rather low number. It was about 1% of the program. When they took the reserves at the end of 2025, and they didn't do that until spring of 26, then it pushed the program into shortfall for 2026. Okay, thank you.

Any other comments from commissioners? Okay, nothing. Please continue in the pipeline.

All right, thank you, and as you do every month, we have attached an update of our monthly pipeline. You can see there's only one change to a date on the pipeline. I anticipate that next month we'll see some more movement as projects have begun construction, and then as the ad hoc convenes for the NOFA, we'll have some projects that move into our funded and applied for funding categories. I'd be happy to answer any questions on the pipeline.

Any questions from commissioners? No questions from commissioners. Clerk, you can ask if there are any public comments on item 10.1.

We are now taking public comments on item 10.1. If you wish to make a comment, please go to one of the podiums in the upper tier of chambers. You will have three minutes and a countdown timer will alert you at the end of that period. Please state your name for the record if you choose to do so.

Hello, my name is Dwayne DeWitt. I'm from Roseland, and on 10.1, I'm glad that you typically do a pipeline, but it's not attached to the agendas that we can see up here today, so I don't get the chance to see what the pipeline shows. Also, the executive director's report was good to hear, but at the same time, hopefully you folks can communicate to whichever jurisdictional agency that you're going to work with on this that the residents in the community would like to make sure that you did pursue every legal action available to you to keep the money, to have it come back to you and to make sure that no vouchers are lost and everything is good for the future. So, especially because of the way you use project-based vouchers to get things built, it's very important that the community understand the pipeline and the correlation with the vouchers and how things are going to work in the next year or two. Thank you for your time.

I see no more public comment.

Thank you. We will go on to item 11, consent items. There are no consent items on this agenda. Item 12, report items. And item 12.1 will be by Angela Morgan on approving an extension for the maturing loan and regulatory agreement for California programs for the Autistic Benton House at 325 Major Drive.

Good afternoon. My name is Angela Morgan, program specialist with the Housing and Community Services Department. The item before you today is the request for an extension of loan and regulatory agreement for the California programs for the Autistics Benton House, located at 325 Major Drive. California Programs for the Autistics Inc., CPA, is a local nonprofit organization founded in 1978 and offers lifelong supportive services for adults with development disabilities. CPA serves clients at two homes in Santa Rosa, Benton Elks, also known as Hope House and Hurley House. Benton House is an existing four-bedroom home comprised of six beds and made affordable to low-income households at or below 80% of area median income, AMI. The Housing Authority loan will mature and become due on September 1st, 2026, and has a principal amount of $30,899.53 plus $24,823.20 of accrued interest for a total of $55,722.73 due at maturity. The regulatory agreement securing the affordability expires on September 1st, 2031. CPA is in good standing and has continually complied with quarterly reporting as required. Additionally, our compliance staff performed an onsite inspection and found the property to be in overall good condition, well maintained and recently painted. The existing financing includes a first mortgage in the amount of $1,656.58, the Housing Authority's loan in the amount of $55,722.73, which includes both principal and accrued interest for a total amount of $57,379.31. The first mortgage is a 30-year amortized loan that matures on September 1st, 2016. Sorry, 2026. If the extension request is approved, the Housing Authority loan will be the only loan secured against the property following the payoff of the first mortgage, and the monthly savings would be used for needed property repairs such as electrical, HVAC needs, and to finance an urgently needed medical support coordinator vehicle for transporting tenants to medical appointments. If approved, CPA will continue to own and operate the project consistent with the regulatory agreement through September 1st, 2056, and ensuring the continued affordability of the project and services to vulnerable individuals in Santa Rosa. The Housing and Community Services Department recommends that the Housing Authority, by resolution, approve the following for California programs for the Autistic Spent in House, located at 325 Major Drive. One, approve an extension for the maturing loan in the principal amount of $30,899.53, by 30 years from September 1st, 2026 to September 1st, 2056. And two, extend the term of the regulatory agreement by 25 years from September 1st, 2031 to September 1st, 2056 to align with the loan term. This concludes the presentation, and in addition to staff, we have representatives from CPA also available to answer questions, any questions that you may have. Thank you.

Any commissioners have any questions? None right now. Clerk, could you ask if there's any public comments?

Thank you. We are now taking public comments on item 12.1. If you wish to make a comment, please go to one of the podiums in the upper tier of chambers. You will have three minutes and a countdown timer will alert you at the end of that period. Please state your name for the record if you choose to do so.

Okay, my name is David Harris. And the little bit of information that's not here is just what the interest rate is. These are, it just compounds that interest over time and no principal or interest, I assume, is due until the extension time in 2056. Is that correct? And it's an accumulating interest during that whole time.

I'm seeing no more public comment.

Okay, we're done with public comments. Would any of the Housing Authority Commissioners like to motion regarding the resolution for item 12.1? Commissioner Ferron?

Thank you, Chair. I am proud to make the recommendations of the Housing and Community Services Department on this issue, both of them. I have some history in the past of putting together projects like this and having to deal with it 30 years later not having the interest to pay and wanting to just keep serving the public. So I admire this agency and I admire the department for being willing to extend it. So I would formally move that the recommendations of the Housing and Community Services Department be approved and waive the reading of the entirety of this recommendation. Any seconds?

Second.

Can we do a roll call please?

Commissioner Fearon. Aye. Commissioner Wimmer. Aye. Commissioner Conte.

Aye.

Vice Chair Capio.

Aye.

And Chair Smith. Aye. Let the record reflect that the motion passes unanimously.

We'll move on to the next agenda item, 12.2 by Angela Morgan. The report approving an extension for the maturing loan and regulatory agreement for community support networks, Dutton Homes, 1548, 1550, and 1552 Dutton Avenue. Thank you.

All right, the next item on today's agenda is the request for an extension of loan and regulatory agreement for Community Support Network's Dutton Homes located at 1548, 1550, and 1552 Dutton Avenue. Community Support Network, CSN, is a local nonprofit incorporated in 1982 and offers a variety of supportive services such as case management, behavioral health, social rehabilitation, residential treatment, substance abuse, supportive housing, and community job skills training for adults countywide. This project is an existing single dwelling unit and a duplex totaling eight units affordable to households at or below 80% of area median income. The Housing Authority loan will mature and become due on November 26, 2026. The loan principal amount is $128,000 plus $115,315.73 in accrued interest for a total amount of $243,315.73 due at maturity. The regulatory agreement securing the affordability expires on November 26, 2026. CSN is in good standing and has continually complied with quarterly reporting. Our compliance staff performed an onsite inspection and found the property to be in good condition with some normal wear and tear to be expected for the property age and usage. His existing financing includes a first mortgage in the amount of $108,237 and the Housing Authority's loan in the amount of $243,315.73. including both principal and accrued interest for a total financing of 351,552.73. The first mortgage is a 30-year amortized loan with a variable rate of 7.6%, but not to exceed 10.6% and matures on November 1st. 2034, the loan to value with the first mortgage is 0.14 using the estimated value of 750 and combined loan to value of 0.46. If approved, CSN will continue to own and operate the project consistent with the regulatory agreement through November 26th, 2056. Meanwhile, approval of this item will ensure the continued affordability of the project and services to vulnerable population and individuals in Santa Rosa. The Housing and Community Services Department recommends that the Housing Authority, by resolution, approve an extension for the maturing loan in the principal amount of $128,000 and regulatory agreement for Community Support Network Stetton Homes located at 1548, 1550, and 1552 Dutton Avenue to extend the term by 30 years from November 26, 2026 to November 26, 2056. This concludes this presentation and in addition to staff, we also have a representative from CSN available to answer any questions you may have.

Any commissioners have any questions? I do have one. So we're just extending the first loan. Is any money being paid to any of the loans at this point?

Thank you for your question. The first loan is going to be paid off. That's not a Housing Authority loan. It just It's coming due. And then we will be the only one left on title. But there will be no payment.

So if nothing's being paid, I'm just curious, why do we have a continue the loan from the Housing Authority? Why don't we just, can we write that off to make it easier? I mean, if nothing's being paid, why do we keep it on there? Is there a reason for it?

Thank you, Chair Smith, for your question. It's my position that we maintain our loans on the property and accompany them with our deed of trust and regulatory agreements. There have been instances in the past where the housing authority has either forgiven interest or released their loan and that property did move onto the market and the the property owner was able to retain the sale proceeds. So by keeping the loan on the property, we do provide ourselves with the ability to recoup the loan in any accrued interest at the time of sale or any transfer of the property.

Thank you. Any other questions? Commissioner?

So let me see if I follow this. There's no monthly payments? No yearly payments? None have been made?

That's correct. These are residual receipt loans, and in smaller properties that serve very specific populations, we often don't see residual receipts coming in on the projects.

How do they expect to pay for it?

It's the overall kind of public serving good that it not be repaid. If the property was to be sold, we would be able to recoup our loan proceeds.

Commissioner Farron? I was the executive director during this time these loans were given. And I can tell you that most of those loans that were taken out are being extended on both sides agreed because of what the staff has said. We aren't interested in selling it and making any money on it. We're interested in continuing the program. It was the position I took several times in the past when agencies came up for renewal that the money we would have paid you for interest the money that we would pay you if we decided to sell the thing, inconsistent with our own ideas, has been put into maintenance. It's allowed us to have rents that were lower than normal. If we have to pay you interest and pay you on these loans like any bank would charge us, you know what the rents would be, and they wouldn't be able to serve the clients that we needed to serve. It's my contention that they should have been grants in the first place. They should have been strong regulatory agreements. No one's taking any issue with that kind of control. It's just having it on your books as some kind of a receivable and our books as a payable. is a waste of time. It hurts us in going after additional grants. Our balance sheet looks like we owe a lot of money to a lot of people, when in fact, when we get to the end of the 30 years, a couple of times, as Megan's pointed out, you forgave the loan. I came to you several times in the past elimination of the interest on some Burbank loans that total over a million dollars in interest. You allowed that to take place because they wanted, as we wanted, to put it into maintenance, to continue the buildings. That's good for you, it's good for us, and I support it continually. I would love to be able to make the motion on this to approve the recommendation of the department. I'm a little worried since I was on the other side originally that I probably have, at least in some people's minds, a conflict of interest. I love CSN, I will continue to support for anything that will help them provide services, but perhaps someone else ought to make that motion.

Thank you, any other commissioners have any questions? Commission, Vice Chair Capia?

The other important aspect of this is with the loan and regulatory agreement intact on the property, we're able to monitor and ensure compliance over time, and we wouldn't be necessarily if we forgave the loan, so it's important.

No more comments from commissioners. We'll take public comment on this, please.

We are now taking public comments on item 12.2. If you wish to make a comment, please go to one of the podiums in the upper tier of chambers. You will have three minutes and a countdown timer will alert you at the end of that period. Please state your name for the record if you choose to do so. I'm not seeing anyone rise, Chair.

Okay, thank you. Would any of the Housing Authority Commissioners like to motion regarding the resolution for item 12.2? You want to motion it? Commissioner Conte?

I'll make the motion without reading the script.

To approve the recommendations of the department on both the loan and the agreement.

Yes, that.

Any seconds?

I'll second.

Okay. Can we take a roll call, please?

Commissioner Fearon? Yes. Commissioner Wimmer?

Yes. Commissioner Conte? Aye.

Vice Chair Capio.

Aye.

And Chair Smith. Aye. Let the record reflect that the motion passes unanimously.

We'll move on to the next agenda item. 12.3 by Kelly Kuykendall, a report approving subordination of the Housing Authority's loans to a new first mortgage for Aston Avenue Apartments at 623 Aston Avenue.

Good afternoon, Chair Smith and Vice Chair Capio. Kelly Kuykendall, Housing and Community Services Manager, and I'll be presenting a request for subordination of the Housing Authority's loans for Aston Avenue Apartments. Aston Avenue Apartments is located at 623 Aston Avenue. It's a 10-unit complex affordable to households at 50%, 60%, and 80% of area median income. It's currently owned by Sonoma Community Action Network, known as Sonoma CAN, and formerly known as Community Action Partnership of Sonoma County. The Housing Authority has two loans on the property that are due December 31, 2032. The balance, including principal and accrued interest as of July 31, 2026, is $935,820. There are two regulatory agreements on the property, a Housing Authority regulatory agreement and a density increase agreement, securing affordability through June of 2061. Oops. In November of 2025, the Housing Authority approved the following. Hold on, I think I might have jumped a slide. Nope, we're good. Okay, oh, now I did. Apologies. There we go. In November of 2025, the Housing Authority approved the following, transfer of ownership to cross-court properties, assumption of the Housing Authority's loans, regulatory agreement and density increase agreement, extensions of the loans to June 2nd, 2061 to align with the terms of the regulatory agreement, Following the Housing Authority's approval, Sonoma Can and CrossCourt properties entered into a purchase agreement. Sale of the property is scheduled to close. This has been updated from August 1st to August 15th. Proposed financing for the purchase is outlined in this slide. There were some new information that came in late last week after the final agenda had been posted. The first mortgage amount and the terms in the slide here of $600,000 have not changed. The purchase price has been negotiated between the buyer and seller and reduced to $1.6 million. So the estimated cash from the buyer is approximately $69,000. The loan to value with these new assumptions is a point, it's about .94, .95. And with the new assumptions still maintains a healthy debt service coverage ratio, which has the potential for making payments on the Housing Authority's loan, which has not been the case with this property since it was put in place in 2006. As part of the Housing Authority's November approval, staff checked cross-court properties references and reviewed financial statements for their properties in Michigan and Wisconsin, and the projected operating pro forma for Aston Avenue, which demonstrate capacity to maintain and operate the properties. Subordination of the Housing Authority's loans to First Mortgage requires Housing Authority approval. Approval will be conditioned upon staff's review of the First Mortgage loan documents and subordination agreement and approval as to form by the City Attorney. The Housing and Community Services Department recommends that the Housing Authority, by resolution, conditionally approve the subordination of the Housing Authority's loans in the principal amount of $558,071 to a first mortgage in the approximate amount of $600,000 for the acquisition of Aston Avenue Apartments, 623 Aston Avenue, by Colin Hooper, DBA Cross Court Properties, or an affiliate limited liability company. This concludes my presentation. I'd be happy to answer any questions that you may have. Thank you.

Any questions by commissioners? Commissioner Whitman, any questions? I just have one question. We've seen a few of these this year of properties being sold. I don't remember the prior three years I've been on the council. Is this just a normal trend, what's happening in our segment of the business?

So there was one other property that came before the Housing Authority recently, and that would have been actually two. Cypress Ridge Apartments, Burbank Housing sold that. And then this is one of two properties that Community Action Partnership, excuse me, Sonoma Community Action Network is selling. So another item before you in November was a request for the sale of their property at Earl Street Apartments, which that property is moving forward and should be closing escrow sometime by the end of this month or early August. So we've had three in the past year.

And is there any reason that they're selling the property?

Sonoma CAN is no longer interested in being a housing provider and they are divesting of their properties.

Commissioner Farron? Before the time in 2006, I was chair of the board of CAP Sonoma. And my wife followed me up until 2008. So she and I span the entire time of Aston's development and implementation. And I can tell you that All of that time, we depended on federal funds to operate the programs. The McKinney Act was mostly funding the Aston Avenue apartments and we found that subsequently, between then and now, federal funds to operate programs diminished. And so we were often looking to give away these properties. I appreciate the fact that you found somebody. I'm hoping they're gonna follow through on the kinds of obligations that we have put into the property. maintaining it, keeping low rents, and having it be a useful resource in the community. It sounds like you've done your best to do that, and that this sale and transfer will continue the kinds of services that we hoped when we first built it. Commissioner Conte.

Yes, we have seen CAM before. Do you know if they've got any other properties that they're looking at selling? I mean, I know they're getting completely out of it, but are there more that are coming up?

To the best of my knowledge, it's Giffin Avenue is another property that is in Santa Rosa and has housing authority loans on it. So I don't know if it's currently being listed, but I know that they are interested. I don't know if it's currently listed, but I know they're interested in listing that property as well.

I was just curious. Thank you.

Thank you.

Any other questions from commissioners? Okay, there's none. We'll go to public comments on this item.

We are now taking public comments on item 12.3. If you wish to make a comment, please go to one of the podiums in the upper tier of chambers. You will have three minutes, and a countdown timer will alert you at the end of that period. Please state your name for the record if you choose to do so.

Yes, good afternoon. Again, my name's David Harris, and... Boy, the numbers, I mean, what these numbers show us is that the principal balance here due to the housing authority is 558, but with accrued interest, it's being listed at 935, which means there's 377,000 of deferred interest here. And this is not a nonprofit that's buying it. I just hope they, what business model they have is a bit of a mystery as to how, if they're renting these to 50, well, to renters who have 50, 60, or 80% of median income for the area, maybe they're getting more than that if they're voucher holders in these properties and they're being approved to pay market rate, you know, for the vouchers, but it's interesting to look at the fact that there are investors who would take on this type of a load. I can't see how they're, the numbers we have here doesn't tell the whole story. With the regulatory agreement, I mean, what's been discussed is A mortgage against the property will get attention if there's ever a transfer of this. Your regulatory agreement could be overlooked by some staffer in the county office and not give you the security of seeing that the regulatory restriction is actually being adequately looked at, thank you.

Hello, my name is Dwayne DeWitt, I'm from Roseland. It's of interest when something like this occurs that we do what we can to make sure that the affordability is maintained long into the future. And so I didn't hear how this is exactly going to be a long-term obligation on the part of the for-profit private entity that now takes over something that is, in a sense, a public service. And these are the types of things that we've seen down the road public services are frequently jettisoned by private interests after they've had them for a few years because they feel they're no longer financially feasible. So I'm hoping there's some sort of a something that is an obligation on the part of the purchaser that they will help maintain affordability for the low income residents that have come to rely upon these services. Thank you kindly.

Chair Emcee, no more public comment.

Okay, would any of the Housing Authority Commissioners like to motion regarding the resolution for item 12.3?

Vice Chair Capio.

Yes, I'll recommend that the Housing Authority subordinate the loans to a new first mortgage for Ashton Avenue Apartments, 623 Ashton Avenue, and waiving further reading.

Any seconds? Commissioner Conte. Commissioner Conte.

I'll second.

You please call for a roll call, thank you.

Commissioner Fearon? Yes. Commissioner Wimmer?

Yes.

Commissioner Conte?

Yes.

Vice Chair Capio?

Yes.

And Chair Smith? Yes. Let the record reflect that the motion passes unanimously.

Commissioner Fearon? in the past when the suggestion came up that you make it grants and not loans and that you take it off your books and that the nonprofits take it off their books and still maintain a strong regulatory agreement but turn it into what we all believed it to be grants. The argument was you really can't speak for the people in 2061 who will be on this commission who have the right at that time to make the decision. It's not yours to make it now and bind that commission Housing Authority Board and I understand and agree with that it's just I hope somebody up there remembers in 2061 this conversation because it's helpful I think to all of us to know why we're building housing and why we're trying to help Commissioner Conte

Yeah, I'm thinking today, you know, tough times are requiring us to make some tough decisions. And I want to thank the staff for helping us all maintain these properties and keeping them available at this point. I know it's taken a lot of work behind the scenes to do these things, so thank you.

We'll move on to item 13, adjournment. Thank you.