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THE CITY OF ... ~ ~L~~S~4NTON® 20 CITY COUNCIL AGENDA REPORT April 17, 2007 Assistant City Manager TITLE: APPROVAL OF FUNDING ASSISTANCE PROGRAM FOR THE CITY DOWN PAYMENT SUMMARY Pleasanton has maintained a Down Payment Assistance Program (DPA) to assist first time buyers with obtaining home ownership since 2003. Recently, the City lost its program funding from the California Housing Finance Agency (CaIHFA) and this requires a reevaluation of the DPA. The City has reapplied to CaIHFA for a new grant and a decision on its application will not be made until June or July of this year. This report outlines the DPA program and makes a recommendation regarding an interim and long-term solution. HOUSING COMMISSION RECOMMENDATION The Housing Commission (HC) met on March 15 to consider the program and recommended that it be funded entirely with $200,000 from City Lower Income Housing as an interim measure to fund loan applications that may approved over the next few months. Final decision on program amendments and funding and will be determined following a decision by CaIHFA regarding the new grant application. RECOMMENDATION Approve the Housing Commission recommendation and direct staff and the HC to reevaluate the DPA program concurrent with a decision from CaIHFA regarding the City's grant application. FINANCIAL STATEMENT Approval of the recommendation requires an allocation of $95,000 from the City Lower Income Housing Fund (LINE) to supplement the $105,000 currently available for the program. The LIHF currently has a balance of approximately $11 million that will adequately fund the additional allocation. The City Council reviewed potential uses for the LIHF last April and determined that mortgage buy downs/low interest loans were an appropriate program use.