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Home My WebLink AboutMINUTES - 09141993 - 1.162 162 . s A ` Contra o. �^ •r Costa TO: REDEVELOPMENT AGENCY County�.. rw c u J FROM: Phil Batchelor Executive Director DATE: September 14, 1993 SUBJECT: First Time Homebuyers Program SPECIFIC REQUEST(S)OR RECOMMENDATIONS(S) & BACKGROUND AND JUSTIFICATION RECOMMENDATIONS APPROVE a First Time Homebuyer Program, as'a demonstration program in Bay Point and Oakley. APPROVE Directors Mortgage Loan Corporation as the administrator of the program, and AUTHORIZE the Deputy Director.of Redevelopment to negotiate an Operating Agreement with Directors Mortgage Loan Corporation to administer, market and service loans made under the program. FISCAL IMPACT No impact on the General Fund. The Program will be funded out of Redevelopment Bond Proceeds. The amount available in Oakley will be$512,392. The amount available'in Bay Point will be$446552. BACKGROUND/REASONS FOR RECOMMENDATIONS In 1991, the Internal Operations Committee directed the Community Developmetit/Redevelopment Agency staff to evaluate alternative first-time homebuN.er financial assistance mechanisms. Among the alternative mechanisms identified was the use of bond proceeds from the Oakley (and later Bay Point) Redevelopment area. In May 1992, Redevelopment Agency staff was directed to develop a demonstration first time homebuyer program. The Oakley and Bay Point Redevelopment Project Areas were selected because the Redevelopment Agency had bond proceeds set-aside in these areas to be used specifically for housing. On June 15, 1992. the Board approved the program as recommended by the Internal E rnal perations Committee. CONTINUED ON ATTACHMENT: X YES SIGNATURE: r _RECOMMENDATION OF EXECUTIVE DIRECTOR_RECOMI�i TION OF AGCY COMMITTE APPROVE OTHER SIGNATURE(S): ACTION OF AGENCY ON September 14 , 1993 APPROVED AS RECOMMENDED x OTHER_ VOTE OF COMMISSIONERS I HEREBY CERTIFY THAT THIS IS A x UNANIMOUS (ABSENT ) TRUE AND CORRECT COPY OF AN AYES: NOES: ACTION TAKEN AND ENTERED ON THE ABSENT: ABSTAIN: MINUTES OF THE REDEVELOPMENT AGENCY ON THE DATE SHOWN. Contact: Carole Norris 646-4076 ATTESTED September 14 , 1993 cc: Community Development PHIL BATCHELOR, Redevelopment Agency AGENCY SECRETARY Auditor-Controller Via Redevelopment Directors Mortgage OMAC Bay Point PAC BY DEPUTY r• Staff then began the process of developing the legal documents, soliciting approval from the Federal National Mortgage Association(FNMA).and selecting a lender to administer the program. FNMA approval was received in January 1993. Staff then developed a Request for Proposals to select a lender. Lender interviews were held and Directors Mortgage Loan Corporation selected. Directors has agreed to make a forward commitment of$7,000,000 in first loans to qualified buyers. It will also market the program, administer the second loan program and service both first and second loans. The Agency was able to negotiate very favorable terms for buyers acquiring a home under this program. In addition, every attempt will be made to use Mortgage Credit Certificates (MCC), and Community Homebuyers Program to further increase affordability. Consistent with the Board's request, the program will be marketed initially to county and other public sector employees, and residents of the two project areas. After an initial marketing period, marketing will be extended. The Agency expects to make between 40 and 60 loans under this program. Coosc�de-r wA September 9, 1993 Contra Costa County Board Of Supervisors c/o Clerk Of The Board 0 IM 651 Pine Street BOARD_0F Martinez, CA 94553 CLERKCONTRA COSTA Co. ORS Dear Sirs, This is a letter concerning the First-Time Homebuyer Program to be considered by the Board of Supervisors on September 14; this program was initiated by the Contra Costa County Redevelopment Agency for approval and is on the agenda under 1.162. We have some concerns in regard to this program. The First-Time Homebuyer loans should be limited to five buyers of new homes in a particular development.- no matter how many homes are built by that developer. Otherwise, a single developer could acquire most of the loans within this development. This money should be spread equally around Oakley, not just going to developments that happens to have new homes on the market at the time the money is released. We were informed that 10% of the total amount of homes in any one development could receive a first-time homebuyer loan; a limit set by the bankers. But this percentage is too high. Either lower this percentage or set a number like 5. We were told by Carole Norris that California Homes, for example, with their 132 homes would qualify for 13 first time homebuyer loans. With an average loan of$40,000, this means that buyers in this one development could receive $520,000 in loans. There is a need to set a limit for each development, regardless of how many homes are constructed. We would also strongly advocate for a report being released at a later date showing what funding was allocated to which developer and what parts of Oakley geographically. Sincerely yours, Patricia Kratina, Chair James R. Pate, Member Housing Element Subcommittee Housing Element Subcommittee Oakley Municipal Advisory Council Oakley Municipal Advisory Council ZthUak Concerned Citizen Of Oakley cc.- Super-visor Tom Torlakson C14 /71