HomeMy WebLinkAbout2004-11-08 City Council (12)City of Palo Alto
City Manager’s Report
TO:HONORABLE CITY COUNCIL
FROM:CITY MANAGER DEPARTMENT: PLANNING AND
COMMUNITY ENVIRONMENT
DATE:
SUBJECT:
NOVEMBER 8, 2004 CMR: 455:04
CONSOLIDATED ANNUAL PERFORMANCE AND EVALUATION
REPORT (CAPER) FOR THE COMMUNITY DEVELOPMENT
BLOCK GRANT (CDBG) PROGRAM FOR FISCAL YEAR 2003/04
This is an informational report and no Council action is .required.
BACKGROUND
The preparation and submittal of a Consolidated Annual Performance and Evaluation
Report (CAPER) is a requirement of the U.S. Department of Housing and Urban
Development for the receipt of Federal Community Development Block Grant (CDBG)
fimds. The attached document was submitted to HUD on September 30, 2004, following
the required 15-day public review period.It is being provided to the Council for
informational purposes only.’
DISCUSSION
The CAPER provides a summary of the resources available and the programmatic
accomplishments in affordable housing and community development activities during the
2003/04 fiscal year. It evaluates the actions taken during the year to implement the
strategies and objectives described in the Consolidated Plan for the period July 1, 2000 to
June 30, 2005, and the progress made in addressing identified priority needs.
Summary_ of Accomplishments
Although no new affordable units were added to the housing stock during the fiscal year,
work progressed on the development of two major projects: Oak Court and the
Opportunity Center. All housing projects are multi-year by nature. Upon completion,
these two projects will add approximately 142 new affordable housing units to Palo
Alto’s existing inventory. The City is on track to achieve the Consolidated Plan’s five-
year goal of providing 125 new units of affordable housing during the period 2000-2005.
CMR: 455:04 Page 1 of 3
CDBG funds provided accessible bathtubs at Stevenson House.. CDBG funds were also
used to provide minor home repairs and accessibility upgrades tO 61 low-income
households in the City. In addition, the HVAC system was upgraded at Avenidas.
All of the public service activities were carried out as anticipated. CDBG funds were
used principally for agencies providing services to homeless, very-low income or elderly
persons. Some of the agencies funded were Clara-Mateo Alliance, Urban
Ministry/InnVision, and the Palo Alto Housing Corporation. These services significantly
expanded the service and shelter opportunities for homeless persons and those at-risk of
homelessness. Project Sentinel provided fair housing advocacy and complaint
investigation services for those who believed they had experienced discriminatory
treatment.
ATTACHMENTS
Attachment A: 2003/04 CAPER
PREPARED BY:
E~-oiza M’urillo-Garcia, Associate Planner-CDBG
DEPARTMENT REVIEW:
IULIE CAPI
Advance g Manager
CITY MANAGER APPROV~ :~~.
/~sMs~s a~nt C~t yR~MaOnaNger\
CDBG Citizens Advisory Committee
Palo Alto Human Relations Commission
League of Women Voters
Stevenson House
Palo Alto Housing Corporation
Community Working Group
Mid-Peninsula Citizens for Fair Housing
CMR: 455:04 Page 2 of 3
Clara-Mateo Alliance
Emergency Housing Consortium
Urban Ministry/InnVision
Shelter Network
Society of St. Vincent de Paul
Avenid.as
Palo Alto Community Child Care, Inc.
Housing Authority of the County of Santa Clara
Economic and Social Opportunities
CMR: 455:04 Page 3 of 3
ATTACHlVIENT A
CONSOLIDATED ANNUAL
PERFORMANCE
AND EVALUATION REPORT
(CAPER)
July 1, 2003 through June 30, 2004
CITY OF PALO ALTO
CALIFORNIA
Prepared By: Department of Planning and Community Environment
Public Review and Comment Period: September 7 - 21, 2004
For Submittal to HUD: September 30, 2004
For information, contact:
Eloiza Mudllo-Garcia, Associate Planner, CDBG (650) 329~2428, or
Catherine Siegel~ Housing Coordinator (650) 329-2108
TABLE OF CONTENTS
A. Descnptio.. of Report .................................................................................................................2
B. Description of Public Review Process .........................; .............................................................2
C. Overview of Identified Needs and Priorities ......................., ............................................: .....2-3
PART H. AFFORDABLE HOUSING ...........i ...........................................................................4
A. Resources
Co
1. Resources Available within the City of Palo Alto .. .........., ........, ...............: .................~..5
.a. Community Developmem Block Grant (CDBG) Funds .....................................5
b. Local HousingFunds ...........r ............~ ......~ ....., .........: ............................ ..........5-6
c. HOME Investment Partnership Act Funds.: ..........................., ............................6
d. Multi-family Housing Program (MHP) Funds ...........................................: ........6
e. Redevelopment Funds ..........: ..................: ..........................................................6
f. -Public Housing ........-. ...............: ................................................. .........................6
2. Other. Resources Obtained by Nonprofits and Others ............................................~ ........7
a. HUD Section 8.= Moderate.Rehabilitation Program .........................................7
b. HUD Section 8 - Shelter Plus Care ...............’ ...................~ .................................7
c. HUD Tenant Based Section 8 Rental Assistance ...............................................7
¯The Housing Authority of the County of Santa ClaraTenant
Based Section 8 Vouchers.& Certificates Issues (Table) .............................8
Accomplishments ......................................................................................................................9
1. Programmatic Accomplishments ....................................................................................9
a. New Construction Rental Housing~ ...............................................................9-10
Oak Court Apartments - South of Forest Multi-family Housing Site
Community Working Group - Opportunity Center Project
b. Rehabilitation of Existing Rental Housing ......................................10-11
Stevenson House
Economic and Social Opportunities
Caravan House
c. Below Market Rate (BMR) Ownership and Rental Programs ....................11-12
d. Rehabilitation of Existing Owner Occupied Single Family Homes .................12
2. Persons and Households Assisted with Housing ..........................................................12
Summary of Housing Accomplishments (H Table 1A) ...................................12-13
Assessment of Performance .......................................................: ...........................................13
1. Evaluation of Progress in Meeting 2003/04 Goals .................................................13-14
2. Barriers to Fulfilling Housing Strategies ......................................................................14
a. Federal or State Barriers ..............................................................................14-15
b. Barriers Related to Local Housing Market Conditions .....................................15
c. Discussion of Most Serious Barriers ...........................................................15-16
3. Actions to Address Obstacles.. ..................~ ..................................................; ......., ........16
a. CDBG Ho~sing Development Fund .........................: .................................16-17
b. Homing T~’ust Fund .............’..’ ....................~ ......." ........ .....................................17
4. Adjustments or Improvements to Affordable Housing Strategies ................................17
a. Public Policies ..................................................................... .........................17-19
b. Development Impact Fees for Housing ..............................................................19
PART HI: COMMUNITY DEVELOPMENT ..............................,,, ...............:, .......,,,,,,,,,’i,,,.,20
A. Resources Available.., .........., ................ ........, ..........~ .............................................................21
1. City of Palo Alto Non-Housing Community Development Resources ......... .......... ~ ..... 21
a. Federal Funds ........................................i~ .............................~ .......................’..121
b. Local Funds ..............- ...........~ .....................- ........................................................21
c. Leveraging .........................: ..........................................................i., ..................22
B. Accomplishments ......................................; ..........; .............................................................;...22
1. Summary of Accomplishments with CDBG Funds ......; ................................i .............22
2. Summary of Community Development Accomplishments (HUD Table 3-1) ......23-24
3.. Summary of Accomplishments, Palo Alto General Fund Money ................................25
4. Summary of Accomplishments with Hamilton Public Benefit Funds ..........................25
5. Actions Taken to Affirmatively Further Fair Housing ............................~ ...............26-28
6. Actions Taken to.Address Needs of Homeless Persons ..........: ....................................29
a. Shelter Plus Care (SPC) .....................~ ...............................i ..........2 ...................29
.b. Community Working Group ........... ............................................................29-30
c. Elsa Segovia Women’s Center.. ......: .............................................~ ....................30
d. Employment Opportunities ...................................................2 ...........................30
e. Homeless Services ......................................................................................30-31
7. Other Actions ........... .................~ ...........................................................i .......................31
a. Lead Based Paint Hazard Reduction ...................................................:. ......31-32
b. Intergovernmental Cooperation ....................................................:... ................32
c. Actions to Ensure CDBG Compliance ....... ......................................, ................32
8. Changes to Annual Action Plan ....................................................................................33
C. Assessment of Performance ..................................... ........ ......~ ............................~ ...................33
t. Evaluation of Progress in Meeting Annual Community Development Goals ....." ........33
2. Barriers to Fulfilling Strategies, ............................, .........~.....,... ...............¯ ...............33-34
3. Adjustments to Community Development Strategies ......, ............................................34
4. Performance Measurement System Status ......................................................: .............34
PART IV: APPENDIX ........................................................................o~ .................................~...35
A. Copy of Ad and Public Review Notice for CAPER
B. Goals and Objectives
C. Grantee Performance Financial Report for Fiscal Year 2003/04
PART Io
INTRODUCTION
PART I.
INTRODUCTION
A. Description of Report
TheU. S. Department of Housing and Urban Development (HUD) has created a grants
management and reporting system to implement the concept of consolidated planning. The
consolidated planning system is intended to relate and link identified needs within a community
to the federal and local resources available to meet those needs, and to strengthen partnerships
among all levels of government and the pri;cate sector. The annual reporting portion of this
system is known as the Consolidated Annual Performance and Evaluation Report (CAPER).
Preparation and submittal of the CAPER is a condition for the City (and nonprofit org~ations
within the City) to apply for federal community development and housing assistance funds such
as Community Development Block Grant (CDBG)and Home Investment Partnership Act-
(HOME) funds. ~
The CAPER provides a summary of the resources available and the programmatic
accomplishments in affordable housing and community development’during the 2003/04.fiscal
year. It evaluates the.actions taken during the year to .implement.the strategies and objectives
described in Palo Alto’s Consolidated Plan for the period July 1, 2000 to June 30, 2005, and the
progress made during the past year in addressing identified priority needs and objectives.
B. Description of Public Review Pro~ess
A notice regarding the availability of the draft CAPER was mailed to interested organizations
and persons. Copies of the CAPER were made available at City Hall. A notice informing, the
public of the availability of the CAPER was published in the Palo Alto Weekly on Friday
September 3, 2004. The notice was also displayed on the City’s website during the public review
period. Acopy of that notice is appended to this report (Appendix A).
The draft CAPER was available for public review and comment for a 15-day period, beginning
on Tuesday’September 7, 2004 and concluding at 5:00 p.m. on Tuesday September 21, 2004.
Copies were made available at the Planning Department reception desk and development center,
as well as the City CDBG website..There were no public comments.received during the review
period.
C. Overview of Identified Needs and Funding Priorities
Palo Alto;s housing and community development needs were identified in the Consolidated Plan
for the period July 1, 2000 to June 30, 2005. Not surprising, the PrOvision of affordable rental
2
housing units was identified as the most critical need in Palo Alto. This includes the provision of
housing affordable to persons who are homeless, or at-risk of homelessness, and persons with
special needs such as the frail elderly, developmentally disabled, physically disabled, or persons
with severe mental illnesses.
While all types of housing are needed in the City, the Consolidated Plan objectives focus on the
creation and preservation of rental housing. Permanent housing for families with children, the
elderly, singles and very small households is the highest priority, followed by transitional
housing with supportive services. While the creation of additional new units of affordable
housing is the most desirable option, the preservation of existing subsidized units that amat-risk
of converting to market rate units is also a high priority need.
Non-housing connnun~ty development needs in Palo Alto include public services and public
facilities and improvements. Public service needs include supportive services and employment
opporttmities for lower income, at-risk, homeless, or disabled populations. There is also a need
to expand; modernize, rehabilitate, and make accessibility improvements to existing pUblic
facilities serving the same populations. See Appendix B for a summary of the 2000-2005
Consolidated Plan Goals and Objectives.
Of the.total 2003/04 CDBG allocation, 46 percent was allocated to housing activities, 22 percent
for public facilities, 14 percent toward public services, and 18 percent for fair housing and
program administration.
PART II.
AFFORDABLE HOUSING
PART H.
AFFORDABLE HOUSING
A. Resources "
1. Resources Available within the City of Palo Alto
a. Community Development Block Grant (CDBG) Fund.~
In fiscal year 2003/04, the City of Palo Alto allocated a total of $924,519 in federal Community
Development Block Grant (CDBG) funds. This amount represents an entitlement allocation of
$791,000 from HUD, $44,000 in anticipated program income, $66,535 in excess program
income received in prior years, and $22,984 in reallocated funds.
Of the total CDBG allocation, $430,069 or 46 percent was allocated for housing-related projects.
b. Local Housing Funds
The City of Palo Alto maintains a local housing trust ft~d that has two sub-funds: the ,~_
"Commercial Housing Fund" fund and the "Residential Housing Fnnd" fund. These are the.
only local sources of funding and subsidies for. affordab]e housing within the City. They are used
to provide matching funds, to pay for expenses which exceed HUD cost limits, to fund the cost of
features and amenities ineligible under.federal housing programs, for pre-development expenses,
feasibility studies, site acquisition and similar purposes.
Commercial Housing Fund: Palo Alto requires commercial and industrial development
projects to pay a housing mitigation fee under Chapter 16.47 of the Municipal Code.
The fees are deposited in the Commercial Housing In-Lieu Fund, and the accumulated
fees and interest earned on the fund are made available only for the creation of new low
and m0derate-ineome housing units under the "Housing Reserve Guidelines" ad-’~pted
by the City Council. The Commercial Fund had an available balance of approximately
$1,100,000 on June 30, 2004.
Residential Housing Fund: Pursuant to Program H-36 (the Below Market Rate
Program) of the City’s adopted Housing Element, Palo Alto collects housing in-lieu
fees from residential developments when it is infeasible to provide below market rate
units on-site. These fees, along with interest earnings of the Fund and other
miscellaneous revenues related to housing, are placed in a special fund - the Residential
Housing Fund. This fund, per adopted City policy, is used mainly to provide funding
for acquisition or rehabilitation of low and moderate-income housing, but may also be
used for assistance to new housing construction projects. At the end of the 2003/04
fiscal year, the Residential Fund had an available balance of approximately $1,200,000.
c. Home Investment Partnership Act,(HOME) Funds
The City of Palo Alto is not an entitlement jurisdiction for the federal HOME program. The City
is only eligible to apply for HOME funds through the State of California HOME program. No
applications were submitted in fiscal year 2003/04.
d. Multifamil¥ Housing Program (MHP) Funds
The Multifamily Housing Program (MHP) is a relatively new source of funding foraffordable
housing as a result of the passage of Proposition 46 in November 2002. MHP provides low interest
loans to developers of affordable housing. Another component of Proposition 46 is funding for
new and existing local housing trust funds. A local housing trust fund is a public or private
partnership created to receive on-going revenues for affordable housing production. The City of
P.alo Alto applied for a grant from the State in November 2003. The State announced in February
2004 that Palo Alto was awarded $1,000,000. The City’s $1,000,000 award will be used to help
subsidize a future rental housing project, either new construction or acquisition and rehabilitation
to be determined in the next two years by the City Council.
e. ~Redevelopment Funds
Although the City has not had access to redevelopment funds in the past, the City Council
approved an ordinance on July 9, 2001 to establish a redevelopment agency for the City of Palo
Alto. Todate, the City has not established a Redevelopment Project Area ....
f. Public Housin~
There are no units of public housing in Palo Alto,
2.Other Resources Obtained by Nonprofits and Others
a. HI_rD Section 8 - Moderate Rehabilitation Program-
Palo Alto Housing Corporation (PAHC) owns and manages a number of apartment buildings
where a portion of the units have rents subsidized under the old Section 8 Moderate Rehabilitation
program. Project-based Section 8 contracts for this rental assistance program were originally
written for terms of 5 to 15 years and are beginning to.expire. Currently, HUD only provides
extensions on a yearly basis. PAHC currently has.37 units under the Section 8 -Moderate
Rehabilitation Program (Oak Manor, 23; Curmer, 9; Emerson South, 5). Oak Manor expires in
2008; Emerson South was renewed until June 2005; and seven units in the Curtner Apartments
were renewed until Ju!y 2~305, while the remaining two will expire in October 2004.
b. HUD Section 8 - Shelter Plus Care
The Housing Authority of the County of Santa Clara has provided the Palo Alto Housing
Corporation with project based Section 8 rental assistance for homeless persons participating in
the County’s Shelter Plus Care (SPC) program. Sevenunits are available at the single room
occupancy, Barker Hotel, and 10 units are available at the Alma Place Apartments. During the
period July 1, 2003 to June 30, 2004, 13 previously homeless individuals were provided with
".:housing through the program. 62 percent were White, 15 percent were Asian, 8 percent were Of
-: another race and 15 percent.were African-American. Of the participants,8 percent were of
. ’:Hispanic ethnicity, Twelve of the program beneficiaries were extremely low income (less than
¯ ~ 30% Of the County median income) and ~one was very low income (less than 50%~ofthe County
median income). Please see a more complete discussion of the Shelter Plus Care.Program in the
~: Community Development Section of this report.
-c. HUD Tenant Based Section 8 Rental Assistance
The Housing Authority 0fthe County of Santa Clara administers the Section 8 Rental Assistance
Program for the City of Palo Alto. There are currently about 4,000 people on the waiting list for
Section 8 certificates. 50 households with a Palo Alto address are currently on the Section 8
waiting list: 5 disabled and elderly, 11 disabled, 13 elderly and 21 non-disabled/non-elderly. The
Santa Clara County Housing Authority reported that 301 households in Palo Alto received tenant--
baSed Section 8 rental assistance in fiscal year 2003/04. The following statistics describe the
participant characteristics for all Section 8 programs in Palo Alto: 251 Housing Choice Vouchers,
0Project B.ased, 13 Shelter Plus Care, and 37 Moderate Rehabilitation.
bedrooms
The Housing Authority of the County of Santa Clara
Section 8 Vouchers and Certificates Issued in Palo Alto FY 2003
Certificate/Voucher Size
!2 , 3 4 5
bedroom bedrooms bedrooms bedrooms bedrooms
28 184 59 28 2 0
White Black
207 30
Distribution by Racial Grou
AsianAmerican
Indian/Alaskan Native
3 61
Hawaiian/
Pacific Islander
0
Hispanic
32
Low Income (51- 80%
of Median)
Distribution by Ethnicity
N0n-Hispanic
269
Total
301
Distribution by Income
Very Low (31- 50% of Extremely Low
Median)(Less than 30% of
Median)
20 277
Total
301
Total
301
Total
301
Elderly Disabled
(Non’Elderly)
Distribution by Status
Non-Elderly/’ Elderly and
Non-Disabled Disabled
Total
166 42 -69 24 301
Male
108
Head of Household
Female
193
TOTAL
301
B. Accomplishments
1. Programmatic Accomplishments
The City of Palo Alto, by itself, and in conjunction with nonprofit housing developers, undertook
the following activities to meet its priorities for affordable housing development and assistance as
stated in the FY 2003/04 Annual Action Plan of the Consolidated Plan.
a. New Construction Rental Housing
Oak Court Apartments (South of Forest Multi-familyHonsing Site)
Location: 845 Ramona Street
In October2002, the City acquired ownership of the 1.23-acre site in a residential
neighborhood south of downtown Palo Alto. The site is a portion of about 10 acres of land
vacated by the Palo Alto Medical Foundation (PAMF) a~ter its move to a new facility
constructed on E1 Camino Real. About half of the 1.23 acres was donated to the City by
PAMF in-lieu of providing below market priced housing within the condominiums and
single-family homes being developed on the rest of its lands. The City paid $3 million for
. the other half of the site with money from its local Commercial Housing Fund.
The City selected the Palo Alto Housing Corporation (PAHC) and Michael Pyatok as the
developer/architect team for the project, named Oak Court. The project consists of a 53-unit
family rental .apartment development with all units affordable to very low and low-income
households. Site ownership was transferred in August 2003 to the PAHC when the
financing to construct the new housing was in place.
Proposition 46~ the Housing Bond Act passed last November, provided $779 million in new
funding for the State’s Multifamily Housing Program (MHP) for very low-income rental
housing. PAHC structured the project’s fuiancing using MHP, a competitive program,
combined with tax-exempt bond-finknced construction and permanent funding and the non-
competitive, four-percent tax credit program. PAHC was successful in this strategy and
received an MHP .funding award of $4,555,100 in June 2003. The project is currently under
construction and is scheduled to be completed in early 2005. The units will be affordable to
households from three income levels: 35% of State Median Income (SMI), 50% of Area
Medianincome (AMI), and 60% of AMI. The current SMI is $62,500 and the AM] is
$105,500.
Community, Working Group - Opportunity Center Project
Location: 33/39/45 Encina Way, Palo Alto
On May 7, 2001 and May 13, 2002, the City Council of Palo Alto approved a total allocation
of $1,280,000 in CDBG funds for the Opporttmity Center project sponsored by the
Community Working Group (CWG), This allocation was provided to CWG in the form of
an interim loan for pre-development, site acquisition and pre-construction expenses. On
9
June 21, 2004, the City Council approved permanent loans and regulatory andloan
agreements with the $1,280,000 in CDBG funds allocated to the homeless service center and
$750,000 of Residential Fund monies to the development costs’ of the 89-housing units.
The Opportunity Center concept evolved from the original 1998 proposal to the current
project of 9,000 square feet of space for a center for day use and the delivery of social
services for homeless adults and families-and 89 units of permanent and transitional housing.
The facility will house existing homeless services presently located ininadequate and .
scattered sites in Palo Alto and the mid-peninsula area.
The Center will be locatedon an 18~178 square foot site at what is presently known as 33, 39
and 45 Encina Avenue between El Camino Real and the Urban Lane entrance to the Palo
Alto Medical Clinic. CWG partnered with the Housing Authority of the County of Santa
Clara and InnVision to acquire and develop the site. The project zoning was approved by
the City Council on March 3, 2003. This partnership wilt also construct the project and
operate the facility.
In addition to Palo Alto’s significant funding contribution, the Opportunity Center received
funding from various .other sources including the County Of San Mateo, the County of Santa
Clara, the federalgovemment and private foundation donors. InnVision, an experienced
provider of homeless services and. transitional housing, will be responsible for .operations
.and ongoing0perating costs of the homeless service center. A groundbreaking ceremony
.took place in May 2004, construction sfarted in September 2004 and the prgject.is scheduled
to be completed in 2006.
b. Rehabilitation of Existing Rental Housing
Stevenson House
Location: 455 E. Charleston Road, Palo Alto
Palo Alto Senior Housing Project, Inc. was.awarded $45,200 in CDBG funds to. replace
outdated bathtubs in several of the unitsat their Stevenson House facility. The facility
consists of 120 affordable housing units, which are occupied by 135 low and very-low
income seniors. The existing bathtubs are the original ones that were installed when the
building was constructed in 1968. The bathtubs were outdated and several of the elderly
residents had difficulty getting into and out of the bathtubs. The original proposal was to
cut-away a section of the existing bathtubs to make them more accessible. However, the
project proved to be infeasible because the bathtubs are made out of cast-iron. The scope
of the project was slightly modified to replace the entire bathtub in the units of those
residents who most needed the new bathtubs. The bathtub installation began in February
2004 and 10 bathtubs were replaced. The project will be completed in Fall 2004.
Economic and Social Opportunities
Location! 1445 Oakland Road, San Jose
Economic and Social Opportunities was awarded $60,000 in CDBG funds to perform minor
rehabilitation activities for low,income residents in the City: They provided minor home
repairs and accessibility improvements, such as ramps and grab. bars. They also provided
weatherization services to make homes more energyefficient. They assisted a total of 61
households in 2003-2004.
Caravan House
Location: 2361 High Street, Palo Alto
Adolescent Counseling Services was awarded $121,197 to renovate their Caravan House
facility, a group home for teenage girls. The house provides a supportive environment for
teenagers who cannot live with their parents for various reasons. The project involves
exterior an.d interior rehabilitation, including painting, roof replacement, and the addition of
a new staff bathroom. The projectis currently underway and is scheduled to be completed at
the end of 2004.
c. Below Market Rate (BMR) Ownership & Rental Programs
The oldest BMR units were built in 1975 and the typical development includes from one to four
BMR units..Fifty percent of the inventory was built in the 1980’s and thirty-four percent were
built between 1975 and 1979. The City and Palo Alto Housing. Corporation initially became aware
.of the problems facingBMR owners in condominium projects facing large .special assessments.for
.capital repairs in February 2001. On’.September.9, 2002, the City Council established a BMR
..program emergency fund as an ongoingpermanent program to prevent the loss of BMR units and
provide emergency loans for BMR unit.owners for substantial mandatory assessments, The
program is also aimed tO preserve BMR uuit.housing stock by preventing loss through foreclosure
or through the resale process. The C0imcil approved loan program criteria and loan terms and
..:appropriated $150,000 from the Residential Housing fund to the BMR Emergency Fund.
As a result of special assessments levied against certain developments as well as the broader
implications of an aging BIVIR housing stock, the Council directed staff to ’ develop a loan program
to address these issues.
BMR Home Ownership Units. The Below Market Rate Program is a City program in
the Comprehensive Plan (Program H-36) which requires developers of market rate
housing to provide a certain number of~ts within each residential project at affordable
prices to moderate income buyers (usually 15% of the total units). The BMR units are
sold.to households on a waiting list with 59-year deed restrictions on use, occupancy and
theresale price. As of June 30, 2004, there were 169 units~ in the ownership program
inventory and 10 new units under construction.
BMR Rental Units. This is the rental-housing component of the City’s BMR
inclusionary housing program. There are 101 BMR rental units in five separate multi-
family rental developments in Palo Alto. These units are rented at below market rents to
very low and low-income eligible households. The specific income eligibility varies
from project to project, however, the City’ s current guidelines target the rental program
to households between 40% and 70% of the County Median Income. The initial 63 units
of BMR rental housing in the 628-unit Stanford West Apartments on Sand Hill Road
-were occupied in 2000-01; 94 additional BMR rental units will be added after 15 years.
Employees of Stanford University, and persons working for businesses located on
Starfford owned lands, have priority for occupancy at the Stanford West project because
the housing has been developed and is owned by Stanford. It is not intended as student
housing. During this period, no new BMR rental units were constructed.
d. Rehabilitation of Existing~ Owner-Occupied Single Family Homes
The City may provide CDBG funds to very low-income owners for home repairs in cases where
there is an urgent need for City financial assistance due to serious health or safety problems. During
the year, there were no applications for this program.
2. Persons and Households Assisted with Housing
The attached Table 1A shows 0 households assisted.with rental housing during the period covered
by this report. The table counts only persons or households newly occupying housing, or living in
newly rehabilitated, preserved or constructed housing units regardless of when the financing or
subsidies were awarded. The Oak Court project will provide 53 units of rental housing and will be
reported on the next CAPER.
.Not included are units that arc vacant or in the.process of renting or units under construction or
which are in.the pre-develoPment stages..Also not included are units assisted with Shelter Plus
Care, counseling services, or~homeless persons or househ61ds who receive overnight shelter. These
-activities are discussed in Part 11I of this report. -
-Summary of Housing Accomplishments
(HUD Table 1A)
Name of Grantee: Ci~ of Palo Alto State: CA Program Year: 2003/04
Priorit~ Need Category
Renters
0 - 30% of Median Family Income (MFI) *
31 - 50% of MFI
51 - 80% of MFI
Total
Owners
0 - 30% of MFI
31 - 50% of MFI
51 -: 80% of MFI
Total
Homeless **
Actual Units
Individuals.
Families
Total
Non-Homeless Special Needs
Total
Total .l-lousing
Total 215 Housing
0
0
TOTAL HOUSING
White
Black/African American
Asian
American Indian/Alaska
Native
Native Hawaiian/Other
Pacific Islander
Black/African American
and White
..Asian and. White
American Indian/Alaska.
-’.Native and White
.:American Indian/Alaska
’.Native and Black/African
’American
Balance/Other
Total Race
’ TOTAL HOUSING
Hispanic
Total Ethnieity
*As annually adjusted by HUD
**Homeless families and individuals assisted with transitional and permanent housing
C. Assessment of Performance
1.Evaluation of Progress ~ Meeting Annual (2003/04) Goals:
Average of 25 Households to be Assisted Per Year
The 2000-2005 Consolidated Plan affordable housing goal is to assist an average of 25 units per
year over the five-year period, or a total of 125 units. Although no units were completed during
fiscal year 2003/04, it should be noted that all housing aetiv.ities are multi-year in nature. The two
projects currently under construction (Oak Court and Opportunity Center) will add significantly
(142 units) to the affordable housing stock and help achieve the 125-unit goal within the next few
years.
The City’s greatest need is affordable housing, and the majority of CDBG and local housing funds
have been targeted and expended to preserve or increase the affordable rental housing stock. All of
the CDBG funds have been used to carry out activities that benefit low and moderate-income
2. Barriers to Fulf’flling Housing Strategies
There are many barriers that Palo Alto faces in meeting its affordable housing strategies, most of
which are beyond the control of the City. Palo Alto has one of the most expensive housing markets
in the country, due in large part to the lack of land suitable for new housing. Most of the City’s
development potential consists of infill on small vacant lots, redevelopment of existing properties,
and conversion of underutilized non-residential lands to higher density residential or mixed use
projects. Other uses, such as churches, and educational facilities, compete for this limited supply of
residential land.
Between 1996 and 2000 the median price of ownership housing more than doubled in Palo Alto.
Average rents were also estimated to have doubled over the same time. period. ~Although there has
.been a downturn in the economy, housing prices have Continued to rise. Almost-all for-sale and
most rental properties are still out of reach for all but households with above moderate-incomes. In
.addition, there continues to be a low vacancy rate for rental housing. As of June.. 2004,.the rental
-vacancy rate in the City was 1.56%. :~
Some of the barriers to building more housing are the result of decisions and priorities set by federal
or State governments that must.decide how to distribute very limited funding. The policies and
priorities set by these agencies often do not favor high cost areas, and most federal housing
resources are not readily available to the City of Palo Alto. Some of these barriers include: the lack
of Congressional appropriations for certain programs; limitations in federal regulations that make
some programs very difficult to use in Palo Alto; the lack of appropriate and available housing sites;
and a lack of interest or capability on the part of for-profit and non-profit developers in pursuing
some federal programs. The principal barriers to fulfilling the City’s affordable housing goals and
objectives are discussed below.
a. Federal or State Barriers:
Changes by the. State’s Tax Credit Allocation Committee in the method of determining awards for
the competitive federal and State housing tax credits has made it more difficult to obtain tax credit
awards for low-income rental housing. There are also very. restrictive caps that limit the total
amount of tax credit awards within certain counties including Santa Clara County. There is far
greater demand in Santa Clara County for the competitive tax credits than the amount allowed under
the allocation cap.
There are problems ofutilizing federal housing programs, such as Section 202 and 811, in. areas
with high construction and land costs. HUD places limitations on the mount of HUD subsidies,
which then result in the need for large local funding contributions to make projects financially
feasible. The amount of federal CDBG funds that the City receives on an entitlement basis from
HUD has not even kept pace with inflation over the last 15 years. The barrier of not being qualified
for HOME funds on an entitlement basis has affected the City’s capability to encourage and fund
affordable housing. Other barriers are:
The lack of State or federal funding forthe preservation of older, HUI)-subsidized
and Section 8 assisted rental housing by acquisition by nonprofit housing
organizations ’
Reduction in the term of project-based Section 8 contract renewals from the 20-year
contracts of the 1970’s to theone-year renewals presently authorized by Congress.
Limited funding in HUD’s budget for the Section 8 tenant-based assistance program
¯ (Section 8 certificates and vouchers administered by local housing authorities) since
FY 1994:
Barriers Related to Local Housing Market Conditions:
Limited vacant land suitable for housing con~tmci:ion and strong competition from
developers of market-rate housing, commercial projects and other uses such as
private schools for any available site.
Extremely high prices for sites suitable for newhousing and for existing residential
properties suitable for acquisition and rehabilitation,
Limited local funding sources for affordable housing.
An extremely low vacancy rate and high housing demand meansthat even modest
rental units are occupied by households with incomes above the HUD low-income
-limit. This means that acquisition and/or rehabilitation programs must relocate
existing tenants in order to utilize federal funds.
¯ / Low vacancy rates and high rental rates have made it difficult for persons to find
¯ housing in Palo Alto using tenant-based Section 8 Certificates and Vouchers.
Discussion of Most Serious Barriers:
The most serious barrier is the lack of dependable access to HOME funds. The fact that the City
does not qualify as an entitlement jurisdiction for HOME funds is a significant barrier to meeting
the City’s housing objectives. The HOME Investment Partnership Act is the principal federal
housing program directly available to local governments. The City can only Obtain funding on a
competitive basis through the State of California’s statewide allocation. The State holds only one
competition round each year. Palo Alto is at a disadvantage in the State’s process because of the
percentage of ranking points assigned to rural applicants and those from jurisdictions with high
poverty rates. The maximum award from the State is $1 million per applicant for projects using 9%
Low-Income Housing Tax Credits and up to $3.5 million for projects not using 9% tax credits.
While the City and PAHC successfully obtained and implemented a majoracquisition and
rehabilitation of the 26-unit Barker Hotel SRO with a FY .1992 HOh~ grant from the State, the City
has not been able to access the State’s HOME funds since that time. There are many obstacles that
haveprevented the City from obtaining HOME funds. The primary obstacles are listed below:
"Extremely high demand and competition for state HOME funds requires that
applications be near perfect to receive funding.
v" The State,s rating criteria favors rural and Community Housing Development
Organizations (CHDO) applicants, and jurisdictions with high rates of poverty. Since
Palo Alto does not fit these priorities, the City is at a great disadvantage in the
competition.
" There are no qualified CHDOs operating in the Palo Alto area, and the local
nonprofit housing developers are not interested in creating CHDOs and pursuing
HOME funds directly.
" The State’s once per year application process is too inflexible for use with the kind of
major rental housing projects that are usually done in Palo Alto. It is unlikely that
project timing and readiness will coincide with the State’s application schedule in a
manner that will earn .maximum points.
"The State’s rating criteria strongly favors appheants with very recent HOME project
experience.
-Another serious barrier is the expiration of project-based Section 8 contracts and insufficient
:.funding from the Federal govermnent for contract renewals. Some ofPalo Alto’s largest subsidized
:housing developments have project-based Section 8 rental assistatice contracts which have expired
.:or will expire in the next few years. Most of these projects are owned and operated by nonprofit
i:housing organizations that desire to continue the low-income use under their HU-D insured financing
~and regulatory agreements.
Renewal of the Section 8 rental assistance contracts for all these projects is critical in order to
preserve affordable rents for the extremely low-income tenants who occupy these units. Many of
these projects serve elderly and disabled persons who would find it very difficult to move, and who
would unlikely be able to secure comparable housing even if they were provided with a Section 8
voucher.
3.Actions to Address Obstacles to Maintain Affordable Housing, or Eliminate Barriers
a. CDBG Housing Development Fund
The City’s CDBG Housing.Development Fund was used to award a $50,000 contract to Eden
Housing, an affordable housing developer in 2002/03, to assist the City in acquiring, a suitable site
for an affordable housing development, A small portion of Eden’s contract has been used for
architectural and design analysis of a potential affordable housing site that is owned by the City.
$100,000 in fiscal year 2003/04 funds was allocated to the CDBG Housing Development Fund for
securing a site. In addition, $409,312 in CDBG funding has’been allocated from.fiscal year
2004/05, for a total of $509,312. Due to the lack of vacant land and the high costs of land, this has
proven to be a difficult challenge.
b. Housing Trust Fund
When the Santa Clara County Board of Supervisors, Silicon Valley Manufacturing Group, Santa
Clara County Collaborative on Housing and Homeless Issues, and the Community Foundation of
Silicon Valley founded Santa Clara County Housing.Trust Fund, the City of Palo Alto was among
the contributors that raised initial seed capital of $20 million in its first two years.. The City initially
contributed $500,000 from the local ResidentiaiHousing Fund. The City has allocated an additional
$150,000 to the Trust to be used exclusively for qualifying affordable housing projects located
within Palo Alto. The Trust is dedicated to building and sustaining a.revolving loan fund and grant-
making program that will leverage-other housing resources .throughout Silicon Valley. The Trust’s
three emphases are creating more affordable rental housing, first-time homebuyer opportunities and
housing for the homeless. Since it began distributing funds in 2000, the Trust has assisted more
than 1,000 families in buying their first homes. They have also provided 12 loans for 573 traits of
homel.ess housing, including the Opportunity Center and ten loans for 999 units of mulfifamily
housing units including the Oak Court Apartments of the Palo Alto Housing Corporation. The Oak.
Court family rental project and theOpportunity Center are described in Section II.B.a of this report..
4. Adjustments or Improvements,to Affordable Housing Strategies
.~a. Public Policies ~.~
Housing Element
The Housing Element is a key component of the Comprehensive Plan adopted by the City Council
and isothe chief policy document describing the City’s housing needs and the policies and
programs the City will use to meet those needs.. On December 2, 2002 the City Council adopted
an updated Housing Element for the period January 1, 1999 to June 30, 2006 with strategies to
meet the City’s fair share of the region’s housing needs as defined by the Association of Bay Area
Governments (A_BAG). The City of Palo Alto is required to provide a total of 1,397 housing units
unmet over the 7½-year period of the 1,397 units; 787 units have been constructed resulting in a
remaining need of 610 units. The following chart indicates the required units by income category:
Total Goal in
Units
1,397 units
% of Total
Very Low ¯
Income (Less
than 50% of
Median)
265 units
Low Income
(50% - 80% of
Median)
Moderate Income
(80% - 120% of
Median)
Above Moderate
(Over 120% of
Median)
116 units 343 units 673 units
19%~8%25%48%
Main poIicies and programs included in the Housing Element address:
Increasing the Supply of.Land Suitable for Housing
Using Existing and Planned Residential Lands More Efficiently and Intensively
Modifying and Strengthening Existing Policies to Increase the Supply of.Affordable Housing
Using Legislative Powers to Promote Affordable Housing
.Reserving 16 sites identified on the Housing Sites Inventory for higher density housing
.As part of the Housing Element Update process, a Technical Advisory Group comprised of
affordable housing advocates was formed to identify programs and policies to encourage
affordable housing production. Staff conducted a focus panel with for-profit and non-profit
housing developers to discuss the viabi.lity of potential development regulations recommended by
the Teehttical Advisory Group and to identify other strategies to increase the housing supply. Two
public forums were held to solicit citizen input and comments on new policies and programs. The
Housing Element went through six City Council public hearings and two Planning and
Transportation Commission hearings.
Zoning Ordinance Update.
Inlate 2003, City staff and consultants e0nducted two public workshops on the Zoning Ordinance
Update, specifically for the implementation of the new land uses called for in the-Comprehensive
Plan: Village Residential, Mixed Use, and Pedestrian!Transit Oriented Development. During that
period:there was also a joint City CounciUPlanning and Transportation Commission Study Session
on the:new land uses, which was open to the public. "
Subsequent to the study session there have been over twenty study sessions and hearings With the
Planning and Transportation Commission to address different land use chapters in the Zoning
Ordinance Update including areas such as single family; low density residential, industrial!research
and development, parking, multi family residential, village residential, mixed use and the
development of a new context based design "Form Code" component. All of the Commission "
meetings are open to the public for written and oral testimony. Preceding most of the Planning
Commission meetings, the staffhas conducted Focus Group meetings with the community that
addressed the issues of a specific land use and/or zoning-ordinance chapter. The City Co .until has
also conducted approximately six public meetings and study sessions on land use issues. The
Planning.Department maintains a Zoning Ordinance Update website that the public can access to
find the latest ongoing developments with the update. In addition, the website allows for the
community to send questions or comments to the City on any zoning ordinance or land use issues.
Implementing the City’s Comprehensive Plan is a major tenet of the Zoning Ordinance Update. Of
the approximately 400 policies and programs described in the Comprehensive Plan, approximately
100 of~em are called out for implementation through the Zoning Ordinance Update. This
includes the new land uses listed above as well as key policies addressing housing, parking, urban
design and zoning ordinance format. The new Form Code being developed for the zoning
18
ordinance will also identify important Comprehensive Plan policies that need to be considered
with development activities. The polices and programs of the recently .adopted Housing Element
(December 2002) are being implemented through the Zoning Ordinance Update. This includes
addressing areas such as second units on single family lots, increasing the opportunity for more
housing and a mixture of housing types, as well as density bonuses and affordable housing
incentives.
b. Developmen~ Impact Fees for Housing
On March 25, 2002, the City Council approved modifications and additions to Impact Fees
collected for residential and commercial development projects. The Impact Fees are now
comprised of three categories: Housing, Traffic and Community Facilities. The key change in the
Housing fee was to increase the fee from $4.21 per square foot to $15.00 per square foot and.
requires that an annual cost of living adjustment be made. The current rate as of May 8, 2004 is
$15.58 applies to nonresidential development. The Council removed the 2,500 square foot project
threshold and the 20,000 square foot exemption, so that the new rate applies to all net new square
footage approved after May 8, 2002. Full payment is required with building permit and some
exemptions are provided, such as hazardous material storage, churches, colleges and universities,
commercial recreation, hospitals and convalescent facilities; private education facilities, ptiblie
facilities and private clubs, lodges and fraternal organizations.
PART llI.
COMMUNITY DEVELOPMENT
PARTm
COMMUNITY DEVELOPMENT
A. Resources Available
1.City of Palo Alto Non-Housing Community Development Resources
a. Federal Funds
The primary federal resource in theCity of Palo Alto for non-housing community development
activity is the Community Development Block Grant(CDBG) Program. The City of Palo Alto is
an entitlement jurisdiction under the CDBG regulations and receives annual fundingon a formula
basis. The purpose of the CDBG program is to develop.viable urban communities by providing
decent housing and a suitable living environment, and by expanding economic opportunities,
principally for low and moderate-income persons. The City receives no other direct federal
funding for community development projects.
As explained earlier in this report, the amount of CDBG funds available for allocation in 2003/04
was $924,519. In fiscal year 2003/04, the City allocated a total of $127,650 to public service
activities, and $166,800 to fair housing activities and CDBG program administration.
b. Local Funds
~Human Service Resource Allocation Process (I-ISRAP) .~.-.
The City of Palo Alto provided $1,278,853 in General Funds in 2003/04 to address priority
human service needs in the community. The funds were allocated through the Human Service
Resource Allocation Process (HSRAP), and administered by the Office of Human Services in the
Community Service Department. The projects funded addressed the Human Relations
Commission’s priority needs in the following categories: nutrition, child-care, youth!teens,
seniors, homeless/low income, disability, information and referral; women, and family support.
H~lton Public BenefitProffr~ for Senior Services " ~
In 1993 the City of Palo Alto entered into an a~eement with Hamilton Avenue Properties
regarding the public benefit portion of a Planned Community .(PC) zone change. The PC allowed
development of a senior condominium project with 36 residential units. The agreement called
for a $500, 000 contribution to the City for the establishment of an endowlnent fund to benefit
seniors and senior services, payable in annual installments of $50,000. Additionally, upon resale
of all the original units, a fee of 2-½% of the sales price of the unit shall also go into the fund. In
fiscal year 2001/02, the tenth and final instalment of $50,000.was disbursed to Avenidas, the
local provider of services for seniors. Avenidas began receiving quarterly interest payments in
August 2003 as an additional provision of the agreement.
c. Leveraging
All of the local non-profit agencies leverage CDBG, HSRAP, and other funding with money
from local orgauizations such as the United Way, corporations, foundations, and individual
donors.
B. Accomplishments
1. Summary of Accomplishments with CDBG Funds
The appended financial expenditure report summarizes, the accomplishments of each activity
funded with Community Development Block Grant funds in 2003/04. The report also specifies
the number and race/ethnicity of persons or households wh_o benefited from the activities. ’
Following is a brief recap of the accomplishments of the public service andother community
development activities that were completed during the 2003/04 fiscal year with CDBG fttuds.
$22,300 to the Palo-Alto Housing Corporation. Provided counseling sessions for very-
low income residents of the Barker Hotel (many of whom were previously homeless).
$7,650 to Emergency Housing Consortium. Provided homeless persons with supportive
services and shelter nights in emergency shelter and transitional housing programs.
$26,800 to Proiect Sentinel. Investigated cases .revolving allegationsofhousing
discrimination in Palo Alto, and provided outreach and education services.
$19~000 to Shelter Network for Haven Family House. Provided transitional housing and
supportive services to homeless families at a rehabilitated facility in Menlo Park.
$45,900 to Clara Mateo Alliance Homeless Shelter. $25,000 for the single persons
shelter and $20,900 for the family shelter wing in the Veterans Administration facility in
Menlo Park. Agency provided shelter and supportive services to homeless individuals
and families.
$75,000 to Palo Alto Community Child Care for.repainting the exterior.of the Ventura
Community Center. The project was completed in June 2004.
$127,579 to Avenidas for repairing and upgrading the Heating, Ventilating, and C0oling
(HVAC) system at their senior center facility. This project was completed.in March
2004.
N6 investments were made in areas of minority concentration. The chart on the following pages
reflects the accomplishments and beneficiaries served with 2003/04 CDBG expenditures:
22
Summary of Community Development Accomplishments
for Public Facilities and Improvements
(HUD Table 3-1)
Name of Grantee: Palo Alto State: CA Program Year: 2003/04
Priority Need Category
Public Facilities
Senior Centers
Handicapped Centers
Homeless Centers
Youth Centers
Neighborhood Facilities
Child Care Centers
Parks and/or Recreation Facilities
Health Facilities
Parking Facilities
Abused/Neglect Facilities
AIDS Facilities
Other Public Facilities
Public Improvements
Solid Waste Improvements
Flood Drain Improvements
Water Improvements
Street Improvements ~
Sidewalk Improvements
Sewer Improvements
Actual Number of
Projects Assisted
1
Actual Number of
Projects Completed
23
Priority Need Category Actual Number of Actual Number of
¯ Proj ects Assisted Projects Completed
Other
Priority Need Category Actual Number of Persons Served
Public Services
Senior Services 622
Handicapped Services
Youth Services
Transportation Services
Substance Abuse Services
Employment Training --614
Crime Awareness
Fair Housing Counseling 18
Tenant/Landlord Counseling
Child Care Services
Health Services
Other Public Services (homeless assistance)8,028 persons and 60 households
Accessibility Needs 61
Other Community Development .
Energy Efficiency Improvements
Lead Based Paint/Hazards
Code Enforcement
Other
Note: Nttmbers reflect persons assisted with CDBG funds only
3. Summary of Accomplishments with Palo Alto General Fund Money
The City.ofPalo Alto Human Service P~esouree Allocation Process (HSRAP) provided
$1,278.,853 in General Fund- dollars to the following agencies for services to lower income
elderly, disabled or special needs residents of Palo Alto during the 2003/04 fiscal year.
¢". Adolescent Counseling Se~ees ~ $91,879. On, campus counseling programs
¢" Alliance for Community Care, $24,706, Homeless outreach program
v~ Avenidas, $434,708. Senior services
¯¢" Clara-Mateo Alliance - $18,125, Elsa Segovia Day Center
" Community. Technology Alliance -$13,853. Housing website/voicemail
¢" Community Association for Rehabilitation (CAR) - $42,354. Services for children
with disabilities and their families
g" La Comida de California, $33,700~ Senior nutrition program
¢" MayView Community Health Center - $18,942. Health care for low income,
homeless, and uninsured residents
¢" Palo Alto Community Child Care - $435,512. Child care subsidies and outreach
¢" Peninsula Center for Blind and-Visually Impaired- $8,974. Services for disabled
¢" Proieet Sentinel - $65,641. Tenant/landlord counseling and mediation services
¢" Second Harvest Food Bank -.$.7,157. Groceries for low,income seniors
¢" .Senior Adult Legal Assistance - $8,528. Legal assistance for seniors
¢" Social Advocates for Youth- $8,166. ~CASA Say youth homeless shelter
g" Support Network for Battered Women - $18,412. Services for battered women
¢" . Urban Ministries of Palo Alto/InnVision - $35,971. Food program and emergency
shelterg" Bay Area Community R-esourees (YCS) - $12,224. Community Service Program and
Summer Service Program
4. Summary of Accomplishments with Hamilton Public Benefit Funds
The final $50,000 allocation, as well as quar~.erly interest payments, supported the Avenidas
Volunteer Corp, Senior Home Repair, and Information and Referral Services. The Avenidas
Volunteer Corp has several programs, including the Early Literacy Program, the Partners in
Caring Program and the Computer Learning Center. Avenidas implemented a new volunteer
program in 2003/04, Avenidas Roadmrmers, to provide transportation services for seniors. The
Senior Home .Repair Program coordinated 547 home repair jobs for seniors in Palo Alto and the
Information and Referral Program responded to 1,148 requests for information.
u
25
5. Actions Taken to Affirmatively Further Fair Housing
The City continues to support the purpose and goal of fair housing and contracted with Project
Sentinel to promote equal opportunity in housing in fiscal year 2003/04. The contract with
Project Sentinel is a collaborative effort with the cities of Mountain View and Sunnyvale.
Services included information mad referral, community outreach mad education, discrimination
complaint checking and investigation, legal referrals mad assistance in resolving complaints. The
City also contracted with Project Sentinel to provide tenant/landlord information, referral and
mediation services through the HSRAP program. Senior Adult Legal Assistauee (SALA) also
r.eceives City of Palo Alto General Funds to provide legal assistance to seniors. This service
could include housing related assistance to elderly residents. In addition to .the.services provided
under these contracts, the following steps were taken in the 2003/04 fiscal year to affirmatively
further fair housing.
City staff participated with other Santa Clara County CDBG entitlement jurisdictions
and Service providers in an effort to develop a Countywide Fair Housing Task Force.
The task force includes representatives from entitlement jurisdictions, fair housing
providers, legal service providers, and other community service providers.
The Office of Human Services continued sponsoring housing information and referral
coordination meetings for service.providers. The meetings have resulted in increased
networking amongst provider agencies and the availability of shared housing wait
lists and other information to help low income; elderly, homeless, or disabled clients
access affordable housing.
The City’s Office of Human Services .provided affordable housing information and
referral services, and distributed the "Directory of Housing Services and Subsidized
Rental Housing in Palo Alto and Surrounding Communities".
The City targeted the majority of its CDBG and local housing funds to increasing/
preserving the supply ~ofhousing affordable to persons with lower incomes and/or
special needs.
The City contracted with Project Sentinel to conduct discrimination audits based on
familial status and disability. Two familial status audits were conducted in September
2003, which resulted in the property owners receiving counseling. Eight audits based
on disability were conducted throughout the City. Some property owners were
counseled and some additional audits are pending further investigation.
The City continues to support police officials and commtmity groups in the
development of policies and actions ~o deal with hate crimes.
Under its fiscal, year 2003/04 contract with the City, Project Sentinel conducted, and collaborated
on a number of education community forums and outreach activities r~lating to discrimination
issues, including:
Provided community presentations at the San Andreas Regional Center, Community
Association for Kehabilitation, Asian American Pacific Family Resource Center, the
Council on American-Islamic Kelations,. Santa Clara County Department of Social
Services Parent Orientation, S0eial Advocates for Youth, and Health Connections
Case Management.
Staffed a table at the Mayfield Health Fair, Community Resource Faire by the
Samoan Resource Organization of the South.Bay, and the United Way Agency Fair
Distributed 1439 brochures from information booths, community presentations, City
hall, real estate of-flees, local businesses and libraries.
English and Spanish language public service announcements were sent to various
radio and television stations on a q~artefly basis, including KBLX, KFSO, KGO,
KMEL, KOIT, KSAN, KEOG, KABL, KQED, KSOL, KLOK, and KKSF.
Conducted4 tester trainers to increase the tester poo! available for North Santa Clara.
County cases. :
Project Sentinel staff hosted a question and answer program on the radio station
KFOG (104.5 & 97.7) on.September 17, 2003.
Wrote a column tiffed Kent Watch for publications around the Bay Area and
California, which appears on a regular weekly and monthly basis.
Staffed an information table at the Adult Services Resource Faire and at the NAACP
California State Conference on October 23, 2003.
Staffed an information table at the Abilities Expo of Northern California from
November 14- 17, 2003
Published quarterly advertisements in the Palo Alto Weekly, E10bservador, Bay Area
Parent, and India Currents
¢~73 Project Sentinel transit posters ran on the ca!train from san Francisco to San Jose.
Attended quarterly Northern California Fair Housing Coalition meetings.
27
Provided training for the staff at Avenidas, a senior service provider, on age and
disability discrimination issues.
Organized training for landlords in Palo Alto in cooperation with the Palo Alto
Human Relations Commission attended by approximately 75 people on February 24,
2004.
Project Sentinel presented a workshop on fair housing laws and.issues and staffed an
informational booth at the Tri-Counties Fiesta Rental Housing Conference and Trade
Show on March 3, 2004.
Conducted 3 fair housing trainings for property owners/management professionals
with properties throughout Santa Clara County.
Presented information to the Palo Alto Human Relations Commission regarding the
history of Fair Housing-Month and information about the fair housing poster contest
on April 8, 2004.
Staffed a fair housing month information booth at the HUD office in San Francisco on
April 14, 2004. Project Sentinel distributed brochures and flyers and answered
questions’about fair housing. ~:~-
Organized a North Santa Clara County fair housing poster contest for 4-8~ grade
students in after-school programs for Fair Housing Month in April. Contestwitmers
were presented with prizes at the May 3, 2004 City Council meeting.. ~
Set upan information booth on June 26, 2004 at the Palo Alto Farmer’sMarket.
Project Sentinel answered questions and distributed flyers and brochures.
During fiscal year 2003/04, Project Sentinel investigated 18 cases of reported discrimination in
Palo Alto. Of the 18 cases investigated, 12 cases (66%) had a positive Outcome (successful
conciliation, referred to attorney, referred tO HUD, or counseled/assisted) and six cases (33%) are
still pending, The 18 cases were in the following categories:
Disability 11 Cases 61.1%
Familial Status/child 3 Cases.16.7%
Marital Status 1 Case 5.5%
Race 3 Cases 16.7%
18 Cases 100%
28
6. Actions,taken to address the needs of homeless persons
Shelter Plus Care (SPC)
The Shelter Plus Care Program, administered by the Office 0fthe County’s Homeless
Coordinator, provides up to five years of project based Section 8 rental assistance for previously
homeless individuals with disab’flities. To qualify for the SPC program, applicants must be
living on the streets, or staying at emergency shelters. Additionally, they must.have a diagnosis
of one or more of the following diseases: (1) Mental illness; (2) Alcohol or drug addiction; and
(3) HIV/AIDS. They must be clean and sober (if their diagnosis is ~g or alcohol addiction),
and be willing to commit to and follow an individual service plan created with their case
manager specifically geared to their individual disability. Extensive support services are a
necessary and required component of the program. These supportive services are provided to
program participants to allow them to maintain their housing, address and resolve ongoing issues
with their particular disability, and achieve a greater level of self-determination.
Alma Place, the 107-unit singleroom occupancy apartment building on Alma Street, has ten
designated SPC units during the reporting period. The Barker Hotel, a 26-unit single-room
occupancy building in the downtown, has seven designated’SPC units, but only two are currently
occupied. The Barker SPC program served a total of four persons during the program year.
Three participants were extremely low-income and one was very low income..::All four:of the
program participants were White. Nine extremely low-income..persons were se~ed in,the Alma
Place;:SPC program during the year. Five were White, two were Asian, two were African
American, and was of another race. One of the participants was of the Hispanic etlmicity.
Overall, the:.SPC program has been successful at housing people with special needs who might
not otherwise be eligible for housing or be able to maintain their housing. . ;.
b. Community Working Group
The Community Working Group (CWG) is the sponsor of a comprehensive homeless service
center (The Opportunity Center).presently under construction that will provide refuge and a range
of professionally run services for those who are homeless or otherwise in need of a safety net of
social services.
The Oppo~ty Center will provide personal se~ces - mail delivery, access t0 a telephone,
showers and personal hygiene supplies, laundry facilities, help fmding food and shelter, and a
supportive environment. Case managers will be available to assist people in obtaining appropriate
job skills, housing, and medical and mental health assistance.
The service center will be on.the ground floor of a 4-story building that will.also have 89 units of
affordable transitional and permanent housing for singles, couples and families with children. The
building design will allow for different populations to coexist in the same area. The project is
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discussed more fully in the housing portion of this report. The project broke ground in May 2004
and is scheduled to be completed in 2006.
c. The Elsa Segovia Women’s Center
As part of a cooperative community model, the Clara-Mateo Alliance opened its day center in the
spring of 2002 for homeless and at-risk women and children from the Mid-peninsula area. The
center, named the Elsa Segovia Women’s Center is located at the Veterans Administration (VA)
campus in Menlo Park. The center provides information and referral, daytime refuge, meals and
child care for homeless women and their children.
d. Employment Opportunities
The City of Palo Alto Office of Human Services continued the homeless worker program during
fiscal year 2003/04. $42,939 of City funding provided short-term City employment opportum’ties
to homeless workers for two l2-week periods. Selected workers were provided with food
vouchers, a voucher for clothing from the local Goodwill, and bicycle transportation. Workers
were helped with resumes and skills training. Eight persons participated in the program, and two
of them continued on to higher paying employment.
¯. e. Homeless Services
In total, the City provided $289,361 in direct fundingfor the following services targeted to
benefit persons who are very low income or homeless:
Urban Ministry - $53,721 in City General Funds and CDBG funds.for a prepared
meal program, a grocery distribution program for low- income persons, drop-in
center and emergency shelter.
Emergency Housin~ Consortium - $7,650 in CDBG funds for emergency shelter
and supportive services provided by the Sunnyvale Armory, the Monterey Glen
Inn Supportive Housing Program, and the Reception Center.
Palo Alto Housing CorPoration - Barker Hotel Counseling - $22,300 in CDBG
funds for casework/counseling sessions for the low-income tenants of the Single
Room Occupancy Barker Hotel and Alma Place. Many of the tenants were
previously homeless, and the counseling sessions help them maintain their
housing stability.
Shelter Network - Haven Family House - $19,000 in CDBG funds for transitional
housing and supportiVe services (including ehildcare) for homeless families with
c~dreni
Clara-Marco Alliance - Family/Singles Shelter and Elsa Segovia Center- $64,025
¯ in CDBG and General ’ funds for ehaergency shelter and transitional housing for
homeless individuals and families with children, as well as for the Elsa Segovia
Day Center.
MayView Community Clinic - $18,942 in City General Funds were provided to
the Clini6 to piovide health care for low,income, homeless, and ~ured
residents.
Alliance for Community Care ~ $24,706 in City General Funds for a homeless
outreach program targeted to those with mental healthissues.
¢"Social Advocates for Youth - $8,166 in City General Funds were provided for the
Casa SAY youth shelter and Safe Place Program for runaway and homeless youth.
City’s Seasonal Jobs Program - $42;939 in City General Funds were used to
sponsor the temporary employment program for homeless workers.
Support Services for Battered Women - $18~412 in City General Funds were used
to provide shelter and supportive .services for abused women and children.
St. Vincent de Paul Day Worker Center - $9,500 in.CDBG funds were used to
provide services, such as food, clothing and;ESL classes at the day worker center
7. :Other Actions
a. Lead-Based Paint Hazard Reduction
Lead poisoning can cause permanent damage tO the brain and many other organs, and Can result
in reduced intelligence and behavioral problems in young children. More than 800,000 children
younger than 6 years old living in the United States have lead in their blood that is above the
level of concern set by the Centers for Disease Control and Prevention (CDC). A significant
number of these children are in families of low income and are living in old homes with heavy
concentrations of lead-based paint. The most common sources of childhood exposure to lead are
deteriorated lead-based paint and lead-contaminated dust and soil in the environment.
The City housing and CDBG staff provide information and referral to property owners,
developers and non-profits rehabilitating older housing about lead-based paint hazards. There is
no information that indicates lower income households are more likely to be exposed to lead
paint hazards in Palo Alto than are families in the general population [see the discussion in the
City’s Consolidated Plan].
The City currently requires that any housing to be rehabilitated with City financial assistance to
be inspected for the existence of lead paint and lead paint hazards. The City will provide
financial assistance for the abatement of such hazards in units rehabilitated with City funding.
b. Intergovemmental Cooperation
The City of Palo Altohas worked closely with the cities of Mountain View and Sunnyvale to
distribute a joint Request for Proposals (RFP) for fair housing services. A single fair housing
provider was selected for all three cities, resulting in more cost-effective services..City staff has
also participated in County sponsored Task Forces and other efforts to increase affordable
housing on a regional basis.
City staffpartieipates in the following:
The Housing Bond Advisory Committee that oversees the Mortgage Credit
Certificate.program and all County bond fiuaneing
The Housing Trust Fund of Santa Clara County
Santa Clara County Collaborative on.Hous’mg and Homeless Issues
The CDBG and HOME Program coordinators of entitlement jurisdictions from
~throughout Santa Clara County that address multi-jurisdictional funding, regional
approaches to fair housing and predatory lending and other issues of common
interest.
Countywide Fair Housing Task Force
c. Actions to Ensure CDBG Program Compliance
The City follows the monitoring requirements for the use of federal funds as directed bY HUD.
City staff attended a HUD sponsored workshop on prevailing wage requirements. The City’s
Department of Planning and Community Environment monitors its housing production goals and
all the activities carried out to~er the goals of the Consolidated Plan. .
Subrecipients of CDBG funds are required to submit ~emi-armual and annual performance.
reports outlining the extent to which program goals have been achieved, and the beneficiaries
who have been served. Program performance is measured against the specific program objectives
outlined in.the contact scope of services. City staff monitors each subrecipient, as necessary; to
insure compliance ~th regulations governing their, administrative, financial and programmatic
operations, and to m~e sure the subrecipients achieve their performance objectives within the
prescribed schedule and budget. " ¯
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8. Changes to Annual Action Plan
No changes were made to Palo Alto’s 2003/04 Action Plan.
C. Assessment of Performance
1. Evaluation of Progress in Meeting Annual Community Development Goals
The City has made progress in meeting its community development goals in the past year,
especially in the area of services for lower income residents. The local safety net of services for
lower income persons is.being strengthened with the creation of more shelter and supportive
services. These efforts contribute significantly to a local continuum of care. All of the public
service agencies funded with CDBG funds address the identified needs of providing a variety of
human services to low-income, at risk populations.
City staff has provided information and referral assistance to residents searching for affordable
rental housing. Shelter beds and services for the homeless population have been increased as
well as services to very tow-income Seniors and persons with disabihties. Employment training
.and entrepreneur programs have been established and targeted to persons who are unemployed
and/or underemployed. ..~
The City pursued all resources it indicated it would, provided requested certifications of
consistency for HUD programs in a fair and impartial manner, and did not hinder Consolidated
Plan implementation by action or willful inaction.
2. Barriers to FuWdling Strategies
The continually increasing cost of land in the Bay Area has not only created a housing crisis, but
a rental crisis for non-profit agencies that serve the vulnerable, at-risk populations. The cost of
office space in northern Santa Clara County is among the highest in the nation, and is slowly
driving service providers fxom the area. In addition, many non-profits have experienced a
decrease in funding and donations because of the economic downturn. Funding cuts have
resulted in a decrease in staffing and services at many of the local non-profit agencies.
Although rental housing prices have stabilized in the Bay Area, the housing that is available is
still out of reach to many low-income residents, primarily because of the lack of available
employment. The economic downturn has caused, a significant increase in unemployment rates.
Many resident renters have been forced into homelessness or forced to leave the area as the result
of dramatic increases in rental rates and unemployment over the past few years. People already
33
in shelters or sub-standard housing find it increasingly difficult to improve their living situations,
and tend to stay in the shelters or.sub’standard housing longer.
3. Adjustments or Improvements to Community Development Strategies
No adjustments to the community .development strategies have been identified at this time.
4. Performance Measurement System Status
The City has not yet developed a performance measurement system for the CDBG program. The
City will work toward developing a performance measurement system and anticipates having a
system in place by fiscal year 2005-06. The City plans on developing a model that outlines the
following performance factors: goals, inputs, acitivities, outputs, and outcomes.
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PART IV.
APPENDIX
PART IV.
A. COPY OF AD AND PUBLIC REVIEW NOTICE