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Down Payment Assistance Loan Program - Emergency Rental Assistance Program for residents with back -rent owed due to the COVID-19 pandemic Affordable Rental Housing projects (most recently Sunflower Hill and Kottinger Gardens) Generally, since County, State, and Federal funds require "local match" funds to be even eligible to apply, one of the benefits of the City's LIHF is that it can be used as leverage ("seed money" or partial matching funds) for other funding sources. The existing Housing Element of the General Plan identifies policies and priorities for expenditure of funds. These policies are excerpted and included as Exhibit A to this report. Generally, the policies support construction of new affordable housing, supplementing other sources of funding to facilitate construction or conversion of units as affordable, or using the LIHF to ensure the long-term viability of existing affordable units and supporting access to housing (rental or down -payment assistance, for example). The following provides additional details for use of the LIHF: - providing incentives (e.g., reduced development fees, assistance in public improvements, or increased density) to encourage construction of affordable housing, including three-bedroom units; - using LIHF to provide financial support to ensure the long-term stability and viability of existing affordable units, such as in the form of rehabilitation funds or funding to reduce financial costs of construction and rent levels of affordable units; - encouraging other elements of the General Plan and related City policies to facilitate affordable housing; - ensuring compliance with the IZO such that each development provides its pro -rata share of the LIHF or provides the affordable hous.ing units; - providing financial contributions to facilitate construction of projects with affordability greater than that required by the IZO; - offering projects low-interest loans to support alternative energy usage and/or significant water conservation systems in exchange for affordable housing units. Inclusionary Zoning Ordinance The City's IZO was adopted by the City Council in 2000, to require development to provide affordable units constructed as part of a housing project. Prior to this, only the LIHF was levied to facilitate the City's affordable housing goals. While payment of fees to the LIHF furthers the City's ability to support housing production, typically by providing a proportion of project funding, and to fund programs that facilitate access to housing, the amounts collected do not come close to meeting the actual costs to fully fund construction of new housing units. As outlined in the attached publication from the Local Government Commission (Exhibit D), the legal basis for inclusionary housing programs is long- established, based on a local government's "broad police powers" — after facing legal Housing Element Update, P21-0751 Planning Commission 5of13