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RECOMMENDATION 1 . Approve a $300,000 loan to Tri-Valley REACH, comprised of $241,176 in federal HOME Program funds and $58,824 in Lower Income Housing Fund to financially support the construction of the ADU at the Hansen property; 2. Appropriate $20,000 from the Lower Income Housing fund and grant these funds to Tri-Valley REACH for the purpose of paying the total amount of impact fees for the two ADUs for this project; and 3. Authorize the City's Chief Building Official to waive the project's building fees and refund Tri-Valley REACH any such fees that have already been paid for the project. FINANCIAL STATEMENT The LIHF has a sufficient fund balance to appropriate the $78,824, including a $20,000 grant to REACH for the project's impact fees, and for a loan of $58,824 for gap funding for the second ADU. In addition to the $78,824 in LIHF funds utilized for these purposes, the City would also waive collection of the $20,000 in building fees associated with this project. Additionally, the proposed project funding for the ADU at the Hansen property includes $241 ,176 in federal HOME Program funds, which together with the $58,824 of LIHF would amount to a $300,000 loan to REACH. Since the federal HOME Program is a reimbursable program, the City would need to initially fund the $300,000 loan using LIHF and General Fund cash; and the City would then submit a $241 ,176 reimbursement request to Alameda County Housing and Community Development Department (County HCD). In turn, the $241 ,176 cash would be reimbursed to the General Fund. The loan terms are expected to be like those for other similarly funded projects, with a modest annual interest rate (3 percent, simple interest), payable over a term from 30 years (Ridgeview Commons) or 55 years (Kottinger Gardens). Page 2 of 6