CITY OF HERCULES by niusheng11

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									                     CITY OF HERCULES
                AFFORDABLE HOUSING PROGRAM

                             ANNUAL REPORT
                         JULY 1, 2007 to JUNE 30, 2008

I.     BACKGROUND

Resolution No. 01-51 was initially adopted by the City Council of the City of Hercules
authorizing the implementation of an Affordable Housing Program (AHP) to serve low to
moderate-income residents. In April of 2004, the City Council, upon recommendation of
the City Planning Commission, adopted and approved the current Program. As the
Program evolved and the Affordable Housing Industry has adapted to market conditions,
the City Council has approved modifications to the historic programs and approved the
implementation of new programs.

II.    OVERVIEW

The City of Hercules and the Redevelopment Agency of the City of Hercules consider the
Affordable Housing Program as the main vehicle that will assist in the delivery of a
comprehensive program to address the many needs of low to moderate-income
individuals / families / households relative to achieving homeownership and housing
stock preservation. Under its current structure the program focuses its efforts in three
main areas 1) homeownership opportunities, and 2) preservation and rehabilitation of
existing housing stock, and 3) education and counseling for would be and new
homeowners.

III.   PROGRAM OBJECTIVE

To assist prospective homebuyers achieve and retain homeownership and to assist current
homeowners in the preservation and rehabilitation of their existing home, which includes
addressing safety issues.

IV.    CLIENTS

Any individual, family or household aspiring to purchase a home within the City of
Hercules or to preserve and/or rehabilitate their existing home, whose household income
does not exceed 120% of the county median income for Contra Costa County as defined
by the United States Department of Housing and Urban Development (HUD) and the
State of California Department of Housing and Community Development (HCD).

V.     SERVICE DELIVERY AREA

The service area consists of the corporate boundaries of the City of Hercules.


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VI.       BARRIERS

The Affordable Housing Program was developed and continues to evolve around the
understanding that its major goal is to bridge for qualified individuals and families the
common barriers to homeownership and preservation and rehabilitation of their Hercules
homes. These barriers are:

Financial:      Money Management, Down Payment Accumulation, Budgeting for
                Homeowners, Default and Foreclosure prevention.

Credit:         Lack of credit, improper credit, bad credit, failure to re-establish credit,
                proper use of credit.

Housing         Lack of affordable and market price-housing stock
Inventory:

Education:      Limited knowledge and understanding by buyers and owners of many
                issues of purchasing and maintaining a home.

VII.      SERVICES

Individuals, families and households are provided with services to achieve
homeownership and to preserve existing housing stock. Two primary services are
provided.

          Counseling:

                1-on-1 Sessions:

                              Personalized 1-on-1 Sessions were implemented this year as
                              part of the client’s requirement to participate in the
                              homeownership program. During this time staff and clients
                              will discuss the client’s overall financial situation. This
                              includes creating a monthly budget, debt management,
                              credit review, and the projected expenses the client will be
                              responsible for once they achieve homeownership. This
                              one-on-one setting will afford clients with the opportunity to
                              go over any questions the client may have about program
                              and application process.

                              A total of thirty-nine (39) clients have completed the session
                              this year.

          Education:

                Program Orientation:

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                         The Orientation is a time to review the specifics of the
                         homeownership program to the potential homebuyers and
                         professionals. This review includes the terms and conditions
                         of the First Time Homebuyer, Citywide Incentive, and
                         Inclusionary Programs. The application process and
                         requirements of participate are discussed during the
                         program.

                          A total of 189 individuals attended this fiscal year.


            Homebuyers Class (First-Time Homebuyers):

                         Educating the clients/potential homebuyers on the process
                         of purchasing a home is the main objective. Review what
                         role the professional service provider plays in the purchase
                         of a home (realtor, broker/lender, title officer, escrow agent,
                         etc.). Explain the different types of loan vehicles and
                         options. The program invites professionals in the field to
                         present information to potential homebuyers. Some areas
                         covered include education on credit and home insurance.
                         Potential clients are exposed to all details related to buying
                         and retaining a home.

                         A total of six (6) classes were implemented this fiscal year,
                         a total of 125 participants have successfully completed the
                         eight (8) hour class.

VIII. PROGRAMS

  A. The following programs were offered to low to moderate-income households:

     Ownership:

            First-Time Homebuyer Program: Thirteen (13) households have achieved
            homeownership. A total of $741,130 of assistance was provided. The
            private sector provided over $4.5 million dollars of capital in the form of
            mortgages to the first-time homebuyers.



            Citywide Employee Incentive Program: One (1) household was assisted
            with this program to purchase a home. A total of $35,000 of assistance
            was provided.



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   Rehabilitation (Preservation and Safety):

           Revitalization and Beautification Program: Seven (7) households were
           approved to participate in the program. A total of $175,000 has been
           committed to rehabilitate these homes.


           Code Compliance: One (1) household was provided with assistance
           totaling $10,000 to address code compliance repairs.

           Gas Valve Shut Off (Safety and Code Compliance): Since the re-start of
           this program in 7/05 113 valves have been installed. Ten (10) valves have
           been installed this fiscal year.

           Quick Fix Program: This program has been approved to assist
           homeowners in beautifying the front of their home, adding to the overall
           aesthetics of the neighborhood. No requests have been received or
           prepared.

           HMU Reduced Utility Rate Program (Offered to the very-low &
           extremely low): Sixteen (16) households, of which fifteen (15) are located
           in the Samara Terrace Senior housing complex, have been approved by
           the Affordable Housing Program for the reduced rates. This reduces the
           rate from 0.1143 to 0.08316 per kilowatt hour.

B. The following programs were offered to households who originally participated in
   the City’s First Time Homebuyer Program.

   Loss Mitigation Program: This program was implemented this year to help
   struggling homebuyers with home retention. The total expenditure was
   $1,649,681.95.

           Purchases: Three (3) households were provided assistance totaling
           $989,076.74 to assist in home retention. A total of $660,605.21 was
           funded to purchase Two (2) households from former First Time
           Homebuyers who have defaulted on their properties. These properties will
           be used for future First Time Homebuyers.

           Refinances: Due to the current decrease of value in homes, the City has
           authorized the provision of additional financial assistance to those who
           have adjusting-loans so they can qualify to refinance at a lower fixed rate.

C. The following programs were offered to Hercules residents with two (2) or
   more mailboxes in a cluster to prevent mail theft




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                 Mailbox Program: A total of 299 secure mailboxes were installed to
                 prevent the theft of mail and ultimately, identity theft and fraud. New
                 structures were built for each cluster.

      D. The following program was offered to Businesses within the limits of the City

           Business Development Loan Program:

                 A total of seven (7) businesses were assisted with this program. A total of
                 $797,000 of assistance was provided during fiscal year 2007-2008.

IX.      ANNUAL COMPLIANCE

All program participants provided information necessary to comply with program
guidelines and were re-certified. Information given includes the following:

         1. Proof of property insurance
         2. Signing Affidavit of Residency
         3. Complete Update Form with current employment and phone numbers
         4. Paid property taxes

Annual Compliance for fiscal year 2008-2009 will also include verification that
participant is current on mortgage payments.


X.       PARTNERSHIPS

Overall program success was achieved by the establishment of partnerships with agencies
that share a common purpose and vision as it relates to delivering affordable housing
opportunities to low and moderate-income households. Some of these partnerships
include:

             1. State of California Department of Housing and Community Development
                (HCD)

                A.      BEGIN:
                                      Received funds totaling $270,000 for grant awarded
                                      in 2004 to provide mortgage assistance loans to first
                                      time homebuyers of very low to moderate-income
                                      means purchasing the Inclusionary units being
                                      delivered by the Baywood development. Maximum
                                      assistance to each recipient was $30,000. In May,
                                      2008 we submitted an application for additional
                                      funding totaling $720,000 to assist homebuyers
                                      purchasing units in the upcoming Sycamore
                                      Downtown Project.

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              B.     Cal Home Program:

                                   In May, 2008 an application to receive grant funds
                                   totaling $600,000 was submitted to assist qualified
                                   First Time Homebuyers within the City of Hercules.

           2. California Housing Finance Agency (CALHFA)

              A.    HELP/RDLP:
                                   Awarded a $4.6 million dollars to assist with the
                                   development of an affordable housing and
                                   commercial mixed-use project within the Central
                                   Quarter District of the Central Hercules Plan (The
                                   Sycamore Street Downtown Project).

              B.   Subordinate Mortgage Assistance Program

                                   Obtained approval to participate as a second
                                   mortgage lender under the Cal HFA program. This
                                   cooperative effort provides low to moderate-income
                                   first time buyers with layered financing to achieve
                                   homeownership.

XI.    MARKETING / ADVERTISING / OUTREACH

In order to promote programs / services and activities to the community, the following
types of vehicles were utilized:

       Printed Media: Produced and distributed flyers, correspondence, etc.

       Electronic Media: City Website includes information on all Programs with
       capability to directly download program application.

       Local Cable: Promoted programs within local cable media

       Outreach: Presentations and printed materials were distributed to/at Hercules
       Chamber of Commerce, “Foreclosure Seminar” hosted by Valley Bible Church,
       “Taking Your Business To The Next Level” Seminar hosted by the Workforce
       Development Board of Contra Costa County, “Real Estate Professional
       Symposium” hosted by First American Title Company, “Department of Real
       Estate and Homebuyer Programs” hosted by Contra Costa Association of
       Realtors, “Community Update” hosted by the City of Hercules. Orientation
       meetings held with local realtors and local lenders.

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DATA MANAGEMENT

Data management is provided in the following areas:
      Applications: a total of 551 applications have been received and screened
      Client Contact Management: a total of 6,148 files (electronic) have been created
      and are maintained.

        Portfolio Management: The Program loan portfolio has a total value of $7.1
        million.


XIII. ACTIVITY

Table 1 provides an overview of activity within the Affordable Housing Program over the
period between July 1, 2007 and June 30, 2008.

XIV. CONCLUSION

In reviewing the documents and activity of the Affordable Housing Program over the past
fiscal year, the measurable level of success in achieving program goals is clear. The
following provides a preview of those areas that will continue to enhance and/or
challenge the Program.

Program Growth:

As the Program moves into its fifth full year it is anticipated that the activity will
continue to increase. With the current increase in rents, there are more qualified first time
homebuyers eager to achieve the goal of homeownership then ever before. Though there
have been difficulties faced by the current market, the City has been proactive in
implementing additional services required to assist in home retention. This will increase
the service demand in the area of counseling and education. Demand will be focused in
the area of credit counseling, financial planning, foreclosure prevention, homebuyer club
services and homeownership education.

Additionally, the implementation of the Neighborhood Clean-up and Community Pride
Campaign Program beginning in August, 2008 will spur additional rehabilitation activity.
This program will also provide an opportunity to solicit safety programs, including the
Gas Shut-Off Valve Program and the Secure Mailbox Replacement Program.

During the past year, the Program has made an effort to obtain funding from other
sources in an effort to provide multi-layered, source-funding to applicants who find
themselves in the lower end of the very low to moderate-income scale. The goal for the



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following year is to continue to utilize State, County and local funds to provide the
financial bridge needed to fill the affordability gap to homeownership.

Housing Availability:

The housing development projected to take place over the next three to four years will
deliver several housing opportunities via the Inclusionary housing requirements within
and outside the Redevelopment Project Area. There have been 281 applicants interested
in the Sycamore Downtown Development scheduled to begin construction in November
of 2008. The Affordable Housing Program will continue to work with the Redevelopment
Agency and the City to assure the continued delivery of the full complement of housing
opportunities.




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                                         TABLE ONE
                                      CITY OF HERCULES
                                 AFFORDABLE HOUSING PROGRAM
                                     FISCAL YEAR 2007-2008


ACTIVITY                 JUL   AUG    SEPT   OCT    NOV   DEC   JAN    FEB    MAR    APR    MAY    JUN    TOTAL

TELEPHONE CALLS          960   1800   1050   1250   910   450   1113   1090   1345   1260   1155   1280   13663
E-MAIL COMMUNICATIONS    231    238    280    275   240   160    310    328    345    334    360    385    3486
OFFICE VISITS             60     84    130     99    90    45     79     84     89     95     90    115    1060
APPLICATIONS MAILED       4      2      2      2     7     2      6      3      5      8      11     15     67
APPLICATIONS PROCESSED    27     19     6      15    4     9      11     9      13     17     46    43      219
MAILBOX APPLICATIONS
RECEIVED/PROCESSED        1     48    164     42     9     2     2      8      5      8      7      5      301
HMU DISCOUNT PROGRAM
APPLICATIONS RECEIVED           12      2     2     1            3      1      4      1             5      31
PROGRAM ORIENTATIONS     30            20           15           24            30            70            189
1 ON 1 COUNSELING        11             4     3     4            1      4      6      6                    39
HOMEBUYER EDUCATION      19            11           5            13            25            52            125
LOANS FUNDED FTHB
PROGRAM                         1             1      1           1             3      2      1      3      13
LOANS FUNDED INCENTIVE
PROGRAM                                                                                             1       1
LOANS FUNDED BUSINESS
PROGRAM                   1     2      1      1            1                                 1              7
LOANS FUNDED LOSS
MITIGATION PROGRAM                     1      2                                1             1              5
LOANS FUNDED R & B
PROGRAM                   1     3                    2           1                                          7
LOANS FUNDED CODE
COMPLIANCE PROGRAM                                               1                                           1
GAS VALVES INSTALLED      3                                                           7                     10
HMU DISCOUNT APPROVED                         5      1     1     1             1      1      3      3      16
MAILBOXES INSTALLED                    99                        21     23     55     43     58            299




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