HomeMy WebLinkAbout2024-01-11; Housing Commission; ; Housing Element Program: Update Minor Home Repair ProgramMeeting Date: Jan. 11, 2024
To: Housing Commission
From: Christian Gutierrez, Housing Services Manager
Staff Contact: Nicole Piano-Jones, Senior Program Manager
nicole.pianojones@carlsbadca.gov, 442-339-2191
Subject: Housing Element Program: Update Minor Home Repair Program
District: All
Recommended Action
Adopt a resolution recommending that the City Council consider amending the city’s Minor
Home Repair Program.
Executive Summary
The City Council adopted a Housing Element in 2021 that included numerous programs
designed to meet a variety of housing needs. One such objective related to the city’s Minor
Home Repair Program. Specifically, Program 3.5 objective (a) of the Housing Element states
that the Minor Home Repair Program will be updated to expand eligible costs and increase
maximum loan amounts. To fulfill this requirement, the Housing Commission is being asked to
consider options to update the Minor Home Repair Program. Staff will then bring the discussion
to the City Council for final consideration.
Explanation & Analysis
Housing Element
Every city in California is required to have a current Housing Element in its General Plan. The
Housing Element is a plan that provides an analysis of a community’s housing needs for all
income levels, along with strategies to respond to and provide for those housing needs. In
addition to policies, programs and objectives that encourage housing development, the
Housing Element also includes programs that promote safe and healthy living environments.
After a two-year process, the 2021-2029 Carlsbad Housing Element was approved by the City
Council on April 6, 2021, which was certified by the State Department of Housing & Community
Development in July 2021. The Housing Element includes policies, programs and objectives
showing how the city intends to accommodate its share of housing for the state’s current
housing cycle, which is from 2021 to 2029. There are about 40 Housing Element programs that
are further divided into nearly 160 program objectives. These objectives identify ongoing
actions the city intends to implement throughout the housing period and specific actions the
city must accomplish. Specifically, Program 3.5 objective (a) of the Housing Element states that
the Minor Home Repair Program will be updated to expand eligible costs and increase
maximum loan amounts. To fulfill this requirement, the Housing Commission is being asked to
HOUSING COMMISSION
Jan. 11, 2024 Item #1 Page 1 of 23
consider options to update the Minor Home Repair Program. Staff will then bring the discussion
to the City Council for final consideration.
Minor Home Repair Program
On April 22, 2008, the City Council approved Resolution No. 2008-121, approving an
appropriation of federal funds and local funds to implement a Down Payment and Closing Cost
Loan and Minor Home Repair Program. The Minor Home Repair Program allows for loans to
lower income homeowners of single-family dwellings units with the following goals:
1) Maintain safe homes and attractive neighborhoods
2) Preserve and improve the quality of the housing stock
3) Assist low-income seniors to age in-place or the disabled to remain in their home
4) Enhance the security of the home through the awarding of loans/loans
The current Minor Home Repair Program consists of the following key program components:
•Max award:$5,000
•Term:Forgiven after five years of owner occupancy
•Interest:No Interest (0%)
•Eligible Applicant: Low-income homeowners at or below 80% Area Median Income (AMI)
•Eligible Properties: Single-family homes and mobile homes in which the land and
mobile home are owned by the eligible owner
•Eligible Repairs:-Remedy unsafe living conditions such as
o Electrical repairs such as unsafe wiring
o Replace broken windows
o Repair termite damage
-Repairs to address accessibility
-Exterior repairs such as removal of hazardous trees or driveway repairs
Since the program was approved in 2008, a total of 13 homeowners have been assisted, for a
total of $57,521.80 in forgivable loans. As of the writing of this report, 11 loans have been
forgiven, and two loans will be forgiven in 2025.
When looking at the current program design, the maximum dollar amount and list of eligible
activities limits the interest in the program. Staff conducted research among local jurisdictions
(Exhibit 3) to demonstrate the level of other programs in the region. While there are variations
to each program, there are a number of similarities between them:
•Single-family properties are assisted with repayable loans only
•Interest varies, but is usually applied for loans
•Programs generally funded with federal funds
•Loan amounts vary between $20,000 - $50,000
•Mobile homes are generally included, but may be a separate program
Based upon program performance and market conditions and trends, city staff recommends
the following changes to the city’s program:
Jan. 11, 2024 Item #1 Page 2 of 23
•Increasing the loan limits:
Based on the increase in labor and materials costs since 2008, the current loan limit of
$5,000 is not sufficient to cover most improvements. City staff recommends increasing
the loan amount to $25,000 for single-family properties with the caveat that the loan be
repayable. The loan amount for mobile home properties in which the land is also owned
is recommended to increase to $10,000.
•Changing the loan terms:
Currently the loan bears no interest and is forgivable after five years of continued
occupancy. If the city is going to increase the loan amount this would not be a
sustainable practice. Additionally, Carlsbad real estate values have significantly
increased since 2008 and will continue to rise based on trends for coastal communities.
Given increasing home values, asking for repayment upon transfer, vacancy or resale is
reasonable and would not be a burden to the homeowner. The loan terms for single-
family homes would be a below market rate of three percent simple interest. For mobile
home properties in which the land is also owned is recommended to remain as zero-
interest loans and due and payable upon sale, transfer, or default.
•Expanding eligible costs:
Program 1.10 (a) in the Housing Element calls for the addition of energy efficiency
improvements to the list of eligible activities under the loan program. Such
improvements can decrease ongoing utility costs, thereby assisting with housing costs
for the low-income homeowner.
An additional consideration could be to target the program to specific areas of the city or
specific groups, such as seniors and/or owners with disabilities. The program could offer
priority to low-income seniors and/or those with disabilities in the event that multiple
applications were competing for limited funding.
Fiscal Analysis
Amending the program will require staff time to update and implement the program based on
anticipated increased interest. There will be a temporary impact to the Housing Trust Fund if
more loans are issued at higher amounts. This will be offset with loan repayments to the
Housing Trust Fund as opposed to forgivable loans.
Next Steps
Housing & Homeless Services staff will include the Housing Commission’s decision in the report
to the City Council.
Environmental Evaluation
Per the California Environmental Quality Act (CEQA), the Minor Home Repair Program is
categorically exempt from CEQA, and a determination has been made that it will not have a
significant effect on the environment. The Minor Home Repair program is exempt per 15301 (a)
(Existing Facilities) of CEQA.
Exhibits
1.Housing Commission resolution
2.Program Guidelines
3.Program Research
Jan. 11, 2024 Item #1 Page 3 of 23
Jan. 11, 2024 Item #1 Page 4 of 23
Summary of Recommendations to Amend the City’s Minor Home Repair Program
-Increase loan amount for single-family residences to $25,000
o Change loan term from forgivable to due upon sale, transfer, or default
o Apply a 3% simple interest rate
Interest is due and payable upon sale, transfer, or default
-Increase loan amount for mobile home residences in which land is also owned to $10,000
o Change loan term from forgivable to due and payable upon sale, transfer, or default
o Zero percent interest
-Expand eligible costs to include energy efficiencies
-Prioritize seniors, disabled and veterans.
Jan. 11, 2024 Item #1 Page 5 of 23
Attachment A
City of Carlsbad- Minor Home Repair Program 1 of 9
MINOR HOME REPAIR
PROGRAM MANUAL
Effective: November 1, 2008
City of Carlsbad
Housing Services
1200 Carlsbad Village Drive
Carlsbad, CA 92008
Phone: 760-434-2812
Exhibit 2
Jan. 11, 2024 Item #1 Page 6 of 23
City of Carlsbad- Minor Home Repair Program 2 of 9
INTENT
The Minor Home Repair Program provides loans to homeowners of single family
dwellings units with the following goals:
1)Maintain safe homes and attractive neighborhoods
2)Preserve and improve the quality of the housing stock
3)Assist seniors to age in-place or the disabled to remain in their home
4)Enhance the security of the home through the awarding of loans/loans
To be eligible, homes must be owner-occupied single-family units and located within
the city limits of the City of Carlsbad and receive written approval of a proposed scope
of work to be completed with the loan proceeds.
ASSISTANCE PROVIDED
The maximum loan amount that a household may borrow under the Minor Home
Repair Program is $5,000 maximum per unit.
All Minor Home Repair Program loans are zero percent interest deferred payment
loans. Each loan will have a five year term. The principal amount of the loans will be
forgiven by 20% per year for each year that the home remains under the original
ownership. If the home is sold (or there is a transfer of ownership) prior to the
expiration of the 5 year term, the portion of the loan which has not yet been forgiven
must be repaid at the time the home is sold or there is a change in ownership. These
loans are available to low income households who own and occupy their home as their
primary residence. Homes may not be rented during the 5 year term of the Minor
Home Repair Program loan.
Manufactured homes are eligible so long as the homeowner also maintains ownership
of the land underneath their home, if the land is rented than the homeowner is not
eligible. There shall be only one loan of funds allowed per property in any 5 year
period.
Carlsbad homeowners are eligible to receive one grant for the duration of the
program.
PROGRAM ADMINISTRATION
The City of Carlsbad administers the Minor Home Repair Program and may set forth
additional policies and procedures as determined to be appropriate to maintain the
integrity of the program and provide for its intended implementation.
ELIGIBILITY REQUIREMENTS
In order to participate, you must be the owner-occupant of a single family dwelling
unit and the property must be located in the City of Carlsbad. Additionally, applicants
Jan. 11, 2024 Item #1 Page 7 of 23
City of Carlsbad- Minor Home Repair Program 3 of 9
may not exceed the low income household income limits established by the U.S
Housing and Urban Development Department (See Attachment 1).
→ Please note: APPLICATIONS WILL NOT BE PROCESSED WITHOUT VERIFICATION OF
ADDRESS, INCOME, OWNERSHIP and PHOTOGRAPHS OF POTENTIAL
IMPROVEMENTS.
Proof of Address: California Driver’s License, California I.D., or utility bill.
Proof of Income: Verification papers are required for all forms of household
income. For example, city staff may ask for: IRS tax forms submitted in prior
years, award letters for social security, supplemental security income (SSI), aid to
families with dependent children (AFDC), pension, unemployment insurance,
disability or workmen’s compensation, child support or alimony, and any other
income. The total income (gross income before deductions and withholding
taxes) must include income received by all persons living in the household.
Applicants must indicate any change of income status and provide
documentation (i.e. divorce, death, etc.)
Proof of ownership: A copy of the property deed must be attached.
Photographs of potential improvements: Homeowners must provide
photographs of the potential improvements as record of the needed repairs. If
the homeowner is unable to provide photographs, city staff would need
permission to enter the home and document the potential improvements as
necessary.
ELIGIBLE COSTS
The loan funds may be used to make minor repairs to remedy unsafe living conditions,
including but not limited to leaky plumbing, lack of smoke detectors, and replacing
broken light switches. For a complete list of eligible repairs please see Attachment 2.
On a case-by-case basis, loan funds may be used to improve the appearance of the
exterior of the residence. Mobile homes are only eligible for this program if the
homeowner owns the land that the mobile home resides on. For additional examples
of eligible repairs please see Attachment 2.
The applicant must submit a scope of work and three bids to complete the work
prepared by a licensed contractor and said scope of work must be approved by the City
of Carlsbad. Loans will not be granted for work completed prior to obtaining written
approval of the scope of work from The City of Carlsbad. All repairs and/or
rehabilitation must be completed in accordance with City Building Codes and other
related codes. The applicant must pay for the eligible improvements and then request Jan. 11, 2024 Item #1 Page 8 of 23
City of Carlsbad- Minor Home Repair Program 4 of 9
reimbursement from the City of Carlsbad. A licensed contractor must certify that the
work has been completed before payment or reimbursement shall be provided.
APPLICATION PROCESS
The City of Carlsbad will complete an initial screening of all potential applicants to
confirm:
1.The applicant is improving or repairing an eligible home within the City of
Carlsbad.
2.The applicant resides within the home as a primary residence.
3.Initial information indicates that the applicant qualifies for the assistance.
4.Initial information, including photographs, indicates that the proposed
improvements/repairs are eligible expenses.
After initial eligibility has been determined, the City of Carlsbad will provide the
applicant with written approval of the proposed scope of work and the necessary
packet of information to proceed with the repairs and/or obtain the loan proceeds. A
credit report and title report may be required as part of the verification
documentation.
Any household that participates in the program will need to sign a loan agreement and
note evidencing the loan. A deed of trust securing the loan will also be recorded
against title to the participant’s home.
Please complete the Application, photographs and return all documents to:
CITY OF CARLSBAD
HOUSING SERVICES
1200 CARLSBAD VILLAGE DRIVE
Carlsbad, CA 92008
For questions, please call: 760-434-2812.
Se habla español.
Jan. 11, 2024 Item #1 Page 9 of 23
City of Carlsbad- Minor Home Repair Program 5 of 9
APPLICATION
NAME:
PROPERTY ADDRESS:
TELEPHONE NUMBER:
HOUSEHOLD MEMBERS: List yourself and ALL persons living/staying in your home.
Attach a separate page if needed. Please list the correct legal name as it appears on
the Social Security Card.
*Note: All information collected is kept confidential and is used for statistical purposes only.
INCOME INFORMATION *all income information is subject to verification
Name: Age:
$ $ $ $ $ $
Employment Income SSI Pension Income AFDC Income Child
Support/Alimony
Other Income
Total Individual Annual Income: $
Name: Age:
$ $ $ $ $ $
Employment Income SSI Pension Income AFDC Income Child
Support/Alimony
Other Income
Total Individual Annual Income: $
Name: Age:
$ $ $ $ $ $
Employment Income SSI Pension Income AFDC Income Child
Support/Alimony
Other Income
Total Individual Annual Income: $
Name: Age:
$ $ $ $ $ $
Employment Income SSI Pension Income AFDC Income Child
Support/Alimony
Other Income
Total Individual Annual Income: $
Name: Age:
Employment Income SSI Pension Income AFDC Income Child
Support/Alimony
Other Income
Total Individual Annual Income: $
*Note: All information collected is kept confidential and is used for statistical purposes only.
TOTAL HOUSEHOLD INCOME: $
Name Relationship
Jan. 11, 2024 Item #1 Page 10 of 23
City of Carlsbad- Minor Home Repair Program 6 of 9
APPLICATION (2 of 2)
I hereby submit completed application and photographs of the areas to be repaired
to the City of Carlsbad’s Minor Home Repair Program. I further certify that all
information provided is true and correct, and that the income I stated above
represents the total household income for the past year preceding this application
including the income of all persons in the home.
I hereby grant permission to the City of Carlsbad’s Minor Home Repair Program staff to
use the information provided to effectively administer the program.
The income information provided above is subject to verification by the City of
Carlsbad. I agree to submit copies of federal income tax returns, and I am aware that
all of the employers may be contacted to verify income received as a result of
employment.
All household members 18 years and older must sign this document.
I, the undersigned, do hereby swear under penalty of perjury that all information
contained on the application is true and correct to the best of my knowledge and
belief.
Signature of Applicant:
Signature of Applicant:
Signature of Applicant:
Signature of Applicant:
Date:
Jan. 11, 2024 Item #1 Page 11 of 23
City of Carlsbad- Minor Home Repair Program 7 of 9
Attachment 1
United States Housing and Urban Development Department
2023 Household Income Limits
Effective: May 15, 2023
Household
Size Low Income
1 $77,200
2 $88,200
3 $99,250
4 $110,250
5 $119,100
6 $127,900
7 $136,750
8 $145,550
Jan. 11, 2024 Item #1 Page 12 of 23
City of Carlsbad- Minor Home Repair Program 8 of 9
Attachment 2
Minor Home Repair Program
List of eligible repairs include, but are not limited to:
Plumbing:
-Clear clogged drains
-Fix leaking plumbing and faucets
-Replace defective toilets and sinks
-Replace defective water heaters
Carpentry:
-Install window locks, door locks
-Rebuild broken steps
-Remove architectural barriers for access
-Replace broken windows, window panes, door hinges
-Restoring porches and stairs
-Repair termite damage or dry rot repair
-Weatherization of doors or windows
Electrical:
-Install smoke detectors
-Replace broken light switches, outlets, fixtures
-Repair unsafe wiring
Special aids for disabled/seniors:
-Install wheelchair ramps, grab bars, levers, railing
-Install devices for the hearing and sight impaired
-Install accessible showers, bathtub, toilets
Exterior Residence:
-Driveway repair
-Eliminating trip hazards
-Fence improvements
-Overgrown shrubbery
-Removal of debris
-Removal of hazardous trees
Jan. 11, 2024 Item #1 Page 13 of 23
City of Carlsbad- Minor Home Repair Program 9 of 9
List of ineligible repairs:
-Repairs to appliances
-Cosmetic repairs
-Tree pruning, unless a safety hazard exists
-Repairs to garages or accessory structures
-Carpet cleaning
-Any item that is “Lead-Based Paint” related or would otherwise require a
risk assessment
-Replacement of kitchen cabinets, countertops
→ Any unmentioned repairs will be considered on a case-by-case basis.
For more information please call the City of Carlsbad Housing Services Department for more information at
760-434-2812. Se Habla Espańol.
Jan. 11, 2024 Item #1 Page 14 of 23
Housing Rehabilitation Programs
San Diego County
Single-Family Homeowners
Location Interest
Rates
Max Loan Requirements
City of Chula Vista 0%-3%
interest
dependent
upon income
$25,000 - Households at 80% AMI.
-No prior grant or loan from City.
-Priority for qualified low-income census
tract areas.
-Applicants must have owned and lived in
property for at least one year and no other
real property ownership.
- Must have adequate equity (max of 85%
LTV prior to funding).
-Max. liquid assets may not exceed $25,000.
City of El Cajon 0% interest $50,000 - Households at 80% AMI.
-0% interest (unless in default).
- Loan is due and payable if the property is
sold, rented, refinanced, transferred, or is
no longer owner-occupied.
-Max. property value restrictions apply.
-Homeowner must have owned the
property for at least one year.
City of Encinitas 3% simple
interest
forgivable
over-time
$50,000 - Households at 80% AMI.
-Max. property value restrictions apply.
-Accrued interest is forgiven over time
period based on the loan amount:
o Less than $15,000 = five years.
o $15,000-$40,000 = ten years.
o more than $40,000 = fifteen years.
-Loan is due if the property is leased, sold,
or transferred to a new owner, or no longer
occupied by the borrower.
-One loan will be permitted per each
property.
City of Oceanside 3% simple
interest
80% of
appraised
value
-Household at 80% AMI.
-Loan is capped at 80% of appraised value.
-Terms between 10-30yrs depending on
loan amount and household income.
-Staff recommends to a loan committee
Jan. 11, 2024 Item #1 Page 15 of 23
Exhibit 3
Location Interest
Rates
Max Loan Requirements
based on a loan analysis of
income/debt/and disposable income to
approving committee.
San Diego County 3% simple
interest
$25,000 - Household at 80% AMI.
-Loan must be repaid when the property
changes hands or the recipient moves.
-Available in the unincorporated area of San
Diego County, or the cities of Del Mar,
Imperial Beach, Lemon Grove, Poway, or
Solana Beach.
Mobile Homeowners
Location Interest
Rates
Max
Loan/Grant
Requirements
City of Chula Vista 0% interest $10,000 -Households at 50% AMI.
-0% deferred 5-year forgivable loan.
-Mobile home located in Mobile home
Zone.
City of El Cajon 0% interest $20,000 -Households at 80% AMI
-0% interest (unless in default).
- Only in specific Mobile home parks.
-Repayment deferred until sale, rental,
refinance, or transfer.
City of Encinitas 0% interest $10,000 loan/
$5,000 grant
-Households at 80% AMI
-Loan forgiven after five years.
-Max. property value restriction apply.
City of Oceanside 3% $10,000 -Household income at 80%
AMI=matching grant.
- Household income at 50% AMI= non-
matching grant.
-Terms between 10-30 years,
depending on loan amount and
household income.
-Staff recommends loan based on loan
analysis of income/debt/and
disposable income to approving
committee.
Jan. 11, 2024 Item #1 Page 16 of 23
Location Interest
Rates
Max
Loan/Grant
Requirements
San Diego County Non-
repayable
$20,000 -Household at 80% AMI.
-Available in the unincorporated area
of San Diego County & the cities of Del
Mar, Imperial Beach, Lemon Grove,
Poway, or Solana Beach.
Cities with No Rehabilitation Programs
-City of San Diego
-Coronado
-Escondido
-National City
-San Marcos
-Santee
-Vista
Jan. 11, 2024 Item #1 Page 17 of 23
Nicole Piano-Jones, Senior Program Manager
Housing & Homeless Services
Oct. 17, 2023
1
Nicole Piano-Jones, Senior Program Manager
Housing & Homeless Services
Jan. 11, 2024
Jan. 11, 2024 Item #1 Page 18 of 23
ITEM 1: MINOR HOME REPAIR PROGRAM
TODAY’S PRESENTATION
•Background
•Housing Element
•Minor Home Repair Program
•Recommended Program Updates
2Jan. 11, 2024 Item #1 Page 19 of 23
HOUSING ELEMENT
•Required all jurisdictions in CA
•2021 –2029 Carlsbad Housing Element approved
by City Council & State in 2021
•HE contains programs & objectives
•Program 3.5 –
•“Minor Home Repair Program will be updated to
expand eligible costs and increase maximum loan
amounts”
ITEM 1: MINOR HOME REPAIR PROGRAM
3Jan. 11, 2024 Item #1 Page 20 of 23
ITEM 1: MINOR HOME REPAIR PROGRAM
MINOR HOME REPAIR PROGRAM
•Created in 2008
•13 homeowners assisted
•Provides $5,000 forgivable loans, to eligible
low-income homeowners
•Single-family homes and mobile homes
where land is owned
•Eligible repairs cover basic plumbing,
carpentry, electrical, and accessibility
4Jan. 11, 2024 Item #1 Page 21 of 23
ITEM 1: MINOR HOME REPAIR PROGRAM
PROPOSED UPDATES
5
Current Proposed
Loan Amount $5,000: Single-family homes
and Mobile homes where land
also owned
$25,000: Single-family homes
$10,000: Mobile homes where
land is owned
Loan Term Forgiven after 5 years all
properties
Due upon sale, transfer, or
default all properties
Interest 0% all properties 3%: Single-family homes
0%: Mobile homes where land
is owned
Eligible Costs Plumbing Electrical
Accessibility Exterior
Carpentry
Same –add Energy Efficiency
Jan. 11, 2024 Item #1 Page 22 of 23
ITEM 1: MINOR HOME REPAIR PROGRAM
Housing Commission adopt a
resolution recommending that the
City Council approve changes to
the Minor Home Repair Program as
delineated in Attachment A of
Exhibit 1 and as directed by the
Housing Commission.
RECOMMENDATION
6Jan. 11, 2024 Item #1 Page 23 of 23