CITY COUNCIL REGULAR MEETING AGENDA PACKET

Page 3 of 4 LIHTC resyndication to secure an allocation of LIHTC to finance the substantial rehabilitation of the Project, and convert the property into a 100% tax credit affordable housing project. On securing a tax credit resyndication allocation, OAHS Promenades plans to convert 65 non- restricted market rate units that would subject the Project to a tax credit regulatory agreement resulting in all 146 units being restricted as affordable, tax credit-restricted units. To ensure that OAHS Promenades is eligible to apply for tax credits, the City is requested to grant OAHS Promenades an option to extend the term of the ground lease to April 1, 2095, so that the term is 99 years from the original April 1, 1996, commencement date. The 99-year term exceeds the 75-year term required by the LIHTC program. Conclusion City staff supports the ground lease assignment to OAHS Promenades, LP, a legal entity controlled by Orbach Affordable Housing Solutions, LLC (Orbach Group), and the related actions, due to the Orbach Group's proven track record of successfully acquiring, rehabilitating, and managing affordable housing communities in 12 states across the country. The Orbach Group currently owns and manages an affordable housing portfolio of more than 5,500 affordable housing residential multi-family units. Additionally, the Orbach Group is an developer experienced with Low Income Housing Tax Credit (LIHTC) projects. OAHS Promenades would assume the existing ground lease, including its affordability restrictions, and pay off all existing outstanding loans. The assignment will facilitate securing additional affordable units at this location and guaranteeing their long-term affordability. EQUITY AND SUSTAINABILITY The action directly implements the Housing Element that serves as the City’s strategy for addressing its housing needs for all residents at all income levels. Housing Element Policy 3.3 is to preserve the affordability of restricted units affordable to extremely low-, very low- and low-income households for the longest term feasible, including requiring units to be deed- restricted in perpetuity whenever allowable, to minimize the risk of affordable units being converted to market-rate housing over time. OUTREACH No outreach was conducted, as this item is a routine matter of City business. STRATEGIC PLAN ALIGNMENT Approval of this action advances the ONE Pleasanton strategic plan goal of Building a Community Where Everyone Belongs - Strategy 6 to implement the Housing Element, by preserving and rehabilitating an existing affordable rental housing community. FISCAL IMPACT The approval and execution of the agreement will transfer the Project from Bayside Communities, LLC to OAHS Promenades, LP, will have no direct fiscal expense impact on the City. OAHS Promenades has proposed to repay all outstanding City loans, which are currently estimated to total $1,011,328 ($998,062 principal loan balances + $13,266 in accrued interests through August 31, 2024). The $1,011,328 repayment amount will be distributed as follows: $751,328 will be deposited into the Lower Income Housing Fund and $260,000 will be returned to Alameda County Housing & Community Development (HCD) as HOME loan repayments. HCD will then return 95% (90% for HOME project costs + 5% for administration costs) of the Page 262 of 454