The 2003/2004 Action Plan for the City of Sunnyvale is the annual update to the City's Consolidated Plan for the Period July 1, 2000 to June 30, 2005. The plan outlines and describes the eligible programs, projects and activities the City plans to undertake with federal resources expected to be available during the year to address the priorities described in the strategy and also other private and non-federal resources that may be made available to leverage the federal resources.

PREPARED BY:

In May of 2000, the Sunnyvale Council adopted a Five-Year Consolidated Plan for the years 2000-05. The purpose of the Consolidated Plan is to describe local conditions and resources; identify a jurisdiction’s overall needs for affordable housing, human service, and non-housing community development; and outline a strategy to address those needs in order to improve the quality of life in Sunnyvale. The Consolidated Plan and the annual Action Plan updates are submitted to the U.S. Department of Housing and Urban Development (HUD) to enable the City of Sunnyvale to receive and administer federal funds under the Community Development Block Grant (CDBG) and HOME programs. The Plan includes three main components:

The Community Profile describes the characteristics of the Sunnyvale population and housing, the affordable housing needs of various income groups, the homeless, and those with special needs who require supportive services, as well as non-housing community development needs.

The Five-Year Strategy describes priorities and actions to address the community needs for the years 2000-05.

In February 2003 the Community Development Department prepared a Community Development (CD) Strategy. The main purpose of the CD Strategy is to guide the use of the City’s limited resources to achieve the maximum possible community development benefit. It is an investment strategy. It is intended to direct city investment over the next five years in a manner, which will best maintain and improve the vitality of Sunnyvale and all of its neighborhoods.

The CD Strategy identified specific needs in the city and areas with a high level of concentrated need. New expanded Housing and Neighborhood activities include acquisition, new construction, multi-family rehabilitation, preserving at risk units, concentrated code enforcement, and Neighborhood Support including neighborhood improvements and First Time Homebuyer support. The CD Strategy is attached to the Action Plan as Attachment A to provide a broad range of updated information, areas of special need and the activities planned over the next five years.

The One-Year Action Plan allocates the available funds to specific programs to carry out the Action Plan on a yearly basis. The plan also describes the activities to be undertaken.

The Housing Division of the City of Sunnyvale is the lead agency responsible for overseeing the development of the Action Plan.

The draft plan was available for review during a 30-day public comment period that began April 2, 2003. A public hearing was held on the draft Plan at the Housing and Human Services Commission meeting on April 23, 2003. The City Council will also hold an additional public hearing on the draft plan on May 6, 2003.

This Analysis of Impediments to Fair Housing (AI), completed on January 2003, meets the requirements of 24 CFR 570.904(c)(1) for entitlement jurisdictions under the Community Development Block Grant (CDBG) program administered by the U.S. Department of Housing and Urban Development (HUD). The City of Sunnyvale conducted this fair housing assessment in cooperation with other entitlement jurisdictions in Santa Clara County, Mid-Peninsula Citizens for Fair Housing, its current fair housing provider, Project Sentinel, its provider of landlord/tenant mediation services, and local social service agencies.

The City, in collaboration with other entitlement jurisdictions in Santa Clara County to insure a coordinated regional approach, funded a study entitled, Fair Housing in Santa Clara County - - An Assessment of Conditions and Programs 2000-2002, which was released in January 2003. The purpose of the study was to determine the fair housing needs in Santa Clara County and whether jurisdictions were responding to those identified needs.

The study looked at a broad range of factors that affect fair housing in Santa Clara County, including perceptions of members of various racial and ethnic groups, responses of the fair housing agencies to enforce federal and state fair housing laws, and the behavior of local lending institutions. The study was a first attempt to look comprehensively at conditions throughout the County and to use data collection to evaluate the elements of fair housing; i.e., demographic change, lending patterns, residential attitudes, land use practices, and the performance of fair housing agencies. The Study utilized data on possible discrimination in mortgage lending, data on perceptions of discrimination and socioeconomic comparisons from the 2000 Census. Several local agencies concerned with fair housing issues and potential impediments to fair housing were contacted. In particular, Mid-Peninsula Citizens for Fair Housing, the City’s current fair housing provider, and Project Sentinel, its provider of landlord/tenant mediation services, provided specific information on cases and complaints specific to Sunnyvale during the past several years. The Study made specific recommendations on a broad range of issues countywide. Many of the recommendations were included in context of Sunnyvale’s needs and issues and included in the updated AI.

A subcommittee comprised of members of the City of Sunnyvale Housing and Human Services Commission was formed to review the draft AI and to participate in the development of strategies to address fair housing issues. The countywide Fair Housing Study recommendations were reviewed for inclusion in the City’s updated AI. The subcommittee was able to assess the current extent and nature of fair housing problems within the City, and proposed ways to improve current programs related to fair housing. The AI presents information on fair housing issues in the City and reviews the wide range of activities that the City currently participates in or supports to further fair housing choice.

The completed AI was submitted to Council and approved on February 4, 2003. The AI was also submitted to HUD and to the National Fair Housing Agency.

The following lists the actions, strategies and activities that the City plans to pursue for the up-coming year to further fair housing choice and opportunities.

The City will continue its efforts to publicize fair housing issues and make the public aware of the resources available to address fair housing problems. The City will continue to work with representatives from Santa Clara County and the other cities in the County. The City will undertake the following activities:

• Promote increased public awareness of fair housing rights and responsibilities in conjunction with other local agencies and service providers.

• Establish a subcommittee of the Housing and Human Services Commission to further the activities of fair housing.

• Work with the Tri-County Apartment Association to increase education and outreach to owners of apartment complexes regarding fair housing laws.

• Partner with other agencies and groups to educate the public on predatory lending practices.

• Work with local real estate brokers and mortgage lenders to increase their awareness of fair housing laws and discriminatory practices.
  
• Expand the City’s service provider’s work program to include provision of fair housing informational materials to households occupying or waiting to occupy rental and ownership units.

The Study of fair housing in Santa Clara county recommended additional research to measure the extent of discrimination and the impact of enforcement activity in the County. Such research is best carried out through joint efforts of jurisdictions within the County. The City of Sunnyvale has also identified mobile home parks as a priority area based on complaints from residents and potential purchasers. The City will undertake the following actions this year:

1. Development of a systematic, randomized testing program in Sunnyvale;
2. Assess compliance of mobile home parks with fair housing laws and state regulations, and space rental increases and impacts on occupants;
3. Assessment of lending patterns of Sunnyvale banks based on Home Mortgage Disclosure Act (HMDA) data; and
4. Survey BMR renter occupants to assess perceptions of housing discrimination.

• Consider funding a random survey of Sunnyvale residents to assess perceptions of housing discrimination (similar to the County survey conducted in August 2000)

The City recognizes that its resources to support fair housing services are limited and that cooperation and collaborating with other agencies and jurisdictions is a high priority. The City will undertake the following activities this year:

• Actively participate in the formation and ongoing efforts of a countywide Fair Housing Task Force. Currently underway is the City’s initiative to take the lead role to organize a countywide focus group to discuss strategies and role of the task force. The focus group meeting will include CDBG coordinators and fair housing service providers and other related service providers as well as representatives from a citizens advisory group, Board of Realtors and other interested parties.
  
• Support the efforts of the Housing and Human Services Commission to participate in the City’s fair housing activities and work with other local organizations.

As part of its review of its fair housing activities, the City has recognized the value of revising its contracts for the delivery of fair housing services and monitoring mechanisms. In response, the following activities have been addressed:

• Reassess City’s contracts for delivery of fair housing services. Initiate a competitive bidding process, consolidating, and revising services to be provided undertaken during February and March 2003. Coordinate services with other north county cities (Palo Alto and Mountain View) to provide comprehensive services throughout the region.

• Encourage the City’s fair housing services provider to take more direct action regarding fair housing issues, including public outreach, monitoring and participation on the new to be formed countywide Fair Housing Task Force.

Implementation of Joint Competitive Bid Process:

Staff from the cities of Mountain View, Palo Alto and Sunnyvale as recipients of Community Development Block Grant (CDBG) funds from the US Department of Housing and Urban Development. Each year the cities allocate funding for fair housing services to be provided by a non-profit organization. In the past, the non-profit fair housing service providers have submitted an application in the pool of applicants for CDBG funding of public services and the cities review the application and determine the funding level in the same manner as the other CDBG applicants.

The countywide study of Fair Housing conditions and services includes recommendations for strengthening fair housing services in Santa Clara County through more regional and sub-regional collaboration. Staff of the cities of Mountain View, Palo Alto and Sunnyvale decided to explore jointly issuing a Request for Proposals (RFP) for fair housing services. The goal of selecting a single fair housing service provider to work jointly for the three cities was to enhance cost effectiveness as well as the scope and quality of services.

On February 19, 2003, paper copies of the RFP were mailed to a list of fair housing agencies and attorneys. The RFP was posted on the Sunnyvale website. An advertisement was placed in the San Jose Mercury-News on February 25, 2003 (the three cities shared the cost equally), in the San Jose Post Record on February 19, 2003, the Palo Alto Weekly on February 21, 2003, and in the Sunnyvale Sun on February 26, 2003. There were no further requests for paper or disk copies of the RFP; the advertisement noted that the RFP was posted on the Sunnyvale website.

On February 27, 2003, a Pre-Proposal Meeting was held in the Mountain View City Hall. Two proposers attended. On March 17, 2003, two proposals were submitted by the deadline at Sunnyvale City Hall. City staff reviewed the proposals, met on March 20 to discuss evaluation weighting criteria and interview questions. Interviews were conducted on March 21 in Mountain View City Hall. The RFP stated the criteria for evaluating the RFPs and these criteria were given points and weighting in an evaluation matrix format. After completion of the interviews, staff filled out the evaluation-rating sheet from the knowledge gained in the interviews as well as the presentations in the written proposals. Staff from the three cities will jointly recommended their selection to their individual councils as part of the Action Plan process.

Next Steps:

Sunnyvale will include all actions to be undertaken by the fair housing provider in the 2003/04 program year contract for services.

Each City will follow its own procedures for negotiating and awarding a contract for fair housing services, after their respective City Council approves the budget for fair housing services in FY03/04. The proposal contained a detailed cost estimate with a breakdown of service goals and costs in each City, which can easily be incorporated in the City contract and scope.

Sunnyvale plans to continue to utilize CDBG funds to fund providers of shelter and homeless services. These include the following:

Sunnyvale Community Services: provides emergency services, counseling, financial as well as food and clothing for low-income residents in crisis, or at risk of becoming homeless.

Clara Mateo Alliance: provides shelter and supportive services to individuals, couples and families to assist them in obtaining stable housing and self-sufficiency.

Community Association for Rehabilitation: provides services to families and individuals who have developmental and/or other disabilities.

Cupertino Community Services: provides the rotating shelter in churches and support services such as food, rental assistance, medical assistance and housing and gas vouchers.

Emergency Housing Consortium: provides emergency shelter and support services in a number of locations in the County as well as operating the winter shelter in the Sunnyvale armory.

Support Network for Battered Women: provides shelter and support services for victims of domestic violence.

Santa Clara County Homeless Collaborative: The City will cooperate with and participate in the County-wide Homeless Collaborative program in their efforts to find funding for shelter and services to the homeless and other housing projects. This will include efforts to obtain greater funding for the Emergency Rental and Mortgage Assistance Program operated by the Emergency Assistance Network of which Sunnyvale Community Services is the local provider. Sunnyvale will also continue to work with other cities in the County to increase the number of year-round shelter beds and other services for homeless individuals and families. The Collaborative has successfully competed for grants for other projects targeted to the homeless in the County.

Sunnyvale is supporting transitional and permanent housing solutions for extremely low-income to low-income individuals through various collaborative projects. The City recently assisted with the acquisition by Emergency Housing Consortium of Eight Trees Apartments, a 24-unit family living environment with supportive services designed to serve families who have transitioned from homelessness into permanent housing. This site will provide permanent, affordable rental and supported housing to families for the next forty years. The City has supported permanent housing in its partnership with Cupertino Community Services (CCS) towards the construction of an apartment/office complex providing 24 units of housing to families and individuals who have been graduated from the transitional and rotating homeless shelter programs.

The City is in the final states of negotiation with Mid-Peninsula Housing Coalition. Mid-Pen is proposing to develop a 66-unit affordable family and senior housing complex to house very low income (30% to 60% of area median), which will provide additional opportunities for people to move into permanent housing.

During the 03-04 funding cycle, Christian Church Homes has submitted an application for the acquisition of Plaza de Las Flores, a preservation project that will insure that permanent and affordable housing to very low income seniors and families remains affordable. This project will preserve the affordability of 100 units for the next 55 years.

The City will continue to enlist the support of housing service agencies to provide shelter and support services and find housing alternatives for families facing homelessness. This objective is a continuation of housing service programs currently offered by private, non-profit agencies subsidized by the City. The plan is to continue offering these programs locally and wherever possible to expand the service provisions to meet demonstrated needs.

The City intends to find opportunities to provide housing for residents in the community that have been identified in need. The primary barriers to meeting the underserved need is the limited funds that are available for affordable housing and that the City has limited opportunities for the development of new construction.

The City will continue to include information about lead-based paint hazards and specific information about how to survey a building for such hazards and how to abate them with its outreach efforts for rehabilitation and conservation programs.

The City will inform all contractors that they will be required to attend Lead Paint Safety training, which addresses lead safe work practices before receiving notification of future bid openings.

During 02/03 Sunnyvale developed a training workshop on safe work practices. Through the rehabilitation program the City will continue to offer technical assistance to homeowners to aid them in maintaining, upgrading, and improving their property. Such assistance will include information on lead-based paint abatement. For homeowners and painting contractors to participate in the Paint Program, they will be required to view the "Safe Work Practices" video and read the "Lead Paint Safety" field guide.

Staff will continue to be kept abreast of lead-safe housing regulations by attending training and coordinating activities jointly with other local participating jurisdictions.

Landlord-Tenant Relations is currently funded from general funds at a level of over $102,000 to provide mediation services for landlords and tenants to resolve differences, neighborhood dispute resolution services and to offer information referrals. The agency is proposing $99,000 for the 2003-04 PY. Community Issues and Neighborhood Disputes will be funded by CDBG for $3,000. This project is an expansion of the Neighborhood Support Program identified in the Community Development Strategy. Project Sentinel designed and conducted outreach presentations to three separate city departmental meetings during 02/03, attended by an approximate total of 40 Sunnyvale employees whose responsibilities place them in situations where the agency’s services could be employed. The goal of the presentation was to inform city staff on the various services available to them through the services offered by Project Sentinel.

In addition to normal activities, dispute resolution is utilized for politically sensitive, high profile special projects. Dispute resolution services has provided facilitation and mediation services in a very public dispute at the request of the City between the city’s Hindu Temple and a number of surrounding citizens. Services are currently being provided to mobile home park residents within the city to safeguard their access to stable housing relationships.

This ordinance, recently revised and adopted in February 2003 implements the Below Market Rate (BMR) policies for new residential construction by requiring that 12.5% of all new ownership units constructed, except those units in R-0, R-1, R-1.5 or R-1.7/PD zones be affordable to low to moderate income households. For rental units, ten percent of the total number of dwelling units shall be maintained as below market rate. In the event that apartment vacancy rates reach levels of three percent or less and rents show a net increase of 20% or more during a twenty-four month period based on the Sunnyvale vacancy and rent survey, BMR units in rental developments shall be increased to fifteen percent of the total number of units. Affordability is restricted to terms of 30 years for ownership units and 55 years for rental units.

The Housing fund can be used for acquisition, rehabilitation, new construction and predevelopment costs of affordable housing. In 2002, funds were used to leverage federal funding towards the acquisition of Eight Trees Apartments, a 24 unit rental complex. Currently the fund has approximately $9.5 million.

Council will be considering funding to support new construction of a 66-unit affordable family and senior housing complex at Moulton Plaza/Homestead Park and the acquisition of Plaza de Las Flores, that will preserve the affordability of 100 units of senior housing. Plaza de Las Flores is an "expiring-use" project whose current for-profit owner is eligible to terminate the HUD Housing Assistance Payments (HAP) contract this fiscal year. Christian Church Homes will acquire the Plaza using CalHFA tax-exempt bond financing, City HOME, CDBG and Housing funds, and potentially additional local, state or private funding sources, preserving affordability by entering into a new 20-year HAP Contract with HUD. All 100 residential units will continue to be reserved for very low-income and extremely low-income elderly households.

The City will continue to address affordable housing for teachers and City employees through the "Housing for Public School Employees, City Employees and Child Care Teachers (HPCC) Program". This program developed last year, is comprised of three components: security deposit rental assistance, first time homebuyer education and down payment loans for home ownership.

The rental assistance component includes the implementation of a Security Deposit Loan Program to assist City employees, employees of public schools serving Sunnyvale, and certified child care workers with income up to 120 percent of median to obtain rental housing with loans of up to $5,000. The education component includes a series of specialized homebuyer education classes and an interactive website that provides available housing assistance programs and training. The home ownership component includes down payment assistance of up to $50,000.

The Housing fund has been and will continue to be used to provide funding for the HPCC program.

The Housing Fund has also been used as a means to leverage funds for the Housing Trust Fund. Sunnyvale gave a contribution of $500,000 to the Housing Trust of Santa Clara County. This amount has been committed to Mid-Peninsula Housing Coalition for the development of Moulton Plaza that will provide 66 units of affordable housing to low income households and extremely low income households.

The Housing Bond Fund was created by the cities involved in the Santa Clara County Housing Bond Committee. Presently there are no projects in the city that will be receiving allocations from this fund.

Non-profit, private and public sectors, including the Housing Collaborative, the Silicon Valley Manufacturing Group, Santa Clara County and local cities came together to develop the Housing Trust Fund as an innovative response to the housing shortage. In FY 0102 The City funded $500,000 from the Housing Fund to the Housing Trust Fund for affordable housing. The City’s investment of $500,000 has helped leverage over $20 million in public and private sector contributions to support affordable housing programs provided by the Trust.

Funds have been committed to Mid-Peninsula Housing Coalition-Moulton Plaza for $500,000 from the Housing Trust Fund and Christian Church Homes is expected to apply for $500,000 for the Plaza de las Flores Project.

The City expects to receive both CDBG and HOME funds in FY 2003-2004 as an entitlement jurisdiction. Other sources of funding may include competitive programs that the City will apply for if a project is applicable and will encourage and support other non-profit agencies’ applications for funds.

Acquisition, Construction and Rehabilitation

The Community Development Block Grant Program provides funding for a wide variety of housing and housing related activities, including the acquisition/development of new affordable housing units, rehabilitation of existing and affordable housing units, lead-based paint abatement, the removal of architectural barriers, fair housing services and public services.

The City of Sunnyvale, as an entitlement city, receives a direct grant from this program. In FY 2003-04 Sunnyvale’s allocation is $1,548,000 in new grant funds and expects to receive $500,000 in revolving fund program income to implement multi-family and single family housing rehabilitation activities.

The City is an entitlement City under the HOME program and expects to receive $777,829 in FY 2003. HOME funds may be used for the construction, rehabilitation, or acquisition of housing for low-income households. In 2003-04 HOME funds are expected to be allocated to non-profit groups for acquisition, new construction and preservation of at risk units. In particular, funds have been requested by a non-profit to preserve the affordability of 100 units of senior housing, at risk of conversion to market rate rents, thereby displacing the current occupants.

This program provides rental assistance payments to private owners who lease their units to assisted families. The Housing Authority of the County of Santa Clara administers the Section 8 program for all of Santa Clara County, including Sunnyvale.

In the next year the City hopes to maintain the 514 vouchers in the City. However with the current downturn in the economy, loss of jobs, the drop in market rate rents, this may improve during the coming year. Some successes have occurred due to higher than normal vacancy rates and a dramatic reduction in rental rates.. The City will continue to respond to this by engaging with other jurisdictions and the Housing Authority to encourage greater participation in rental subsidy programs.

The Section 202 program provides housing and related facilities for elderly persons. HUD issues long-term direct loans to eligible private non-profit sponsors for rental or cooperative housing which will be occupied by elderly persons. The interest rate is determined annually. Subsidies are made available for all of the units.

Section 811 provides rental assistance and capital advances to finance the acquisition, rehabilitation or new construction of buildings to be used as supportive housing for extremely low-income persons with disabilities.

This program provides grants for rental assistance for projects that are offered with support services to homeless people with disabilities. Assistance is targeted primarily to homeless persons who are severely mentally ill, have chronic problems with alcohol or drug abuse, or have AIDS/HIV. Rental assistance can be for Single Room Occupancy, Sponsor-Based Rental Assistance (SRA), Tenant-Based Rental Assistance (TBA), and Project-Based Rental Assistance.

This program provides funds for the acquisition, rehabilitation, conversion, lease and repair of facilities to provide housing and services for persons with AIDS, including: new construction of single room occupancy dwellings and community residences, project or tenant-based rental assistance, short term rent, mortgage and utility payments to prevent homelessness, supportive services, operating costs and housing information services for persons with AIDS.

The City of San Jose administers the HOPWA funds for the county. The City works directly with the Santa Clara County HIV Planning council and the other entitlement jurisdictions in Santa Clara County to determine the appropriate allocation of funding according to need. The 2003 PY HOPWA funds for all of Santa Clara County is $787,000 in HOPWA. The countywide plan for next year’s use of HOPWA funds will be for:

• City of San Jose program administration: $23,610;
• A Request for Proposal (RFP) for the remaining $763,390. San Jose expects to prepare the RFP upon completion of its Annual Plan approval process.

The purpose of this grant program is to develop cost-effective community strategies; funds can be used for rehabilitation, planning and operating costs.

LIHTC were used as the principal form of financing for the Carroll Inn SRO and was also used for the First Community Housing’s Parkview family housing project. LIHTC allows a development for extremely low and low income households to secure equity financing while providing the lender a tax credit for the funds. Mid Peninsula Housing Coalition applied and received LIHTC financing for the purchase of Homestead Park’s 222 units. Mid Pen plans to apply in July for credits that will support the construction of Moulton Plaza. There continue to be state tax credits available and any new projects will explore LIHTC as a major source of financing.

California Housing Finance Agency (CalHFA)

CalHFA provides low-interest financing for a number of housing programs designed to benefit primarily persons of low and moderate income. These include a major program to provide loans to non-profit developers of multi-family rental housing.

Both current housing projects’ (Plaza de las Flores and Moulton Plaza) loans will secure Bridge Financing and permanent loans from CalHFA.

CalHFA offers a first time homebuyer program designed to assist first-time homebuyers in the highest housing cost areas of the state. This is one of the financing tools that will be incorporated in the City’s proposed Down Payment Assistance Program.

The Mortgage Credit Certificate Program provides financial assistance to first-time home buyers for the purchase of single-family homes, townhouses and condominiums. The MCC gives the homebuyer a federal income tax credit each year the buyer keeps the same mortgage loan and lives in the same house. The MCC tax credit equals 15% of the mortgage interest paid each year. That 15% is subtracted dollar for dollar from federal income taxes. The remaining 85% of mortgage interest is taken as a deduction from gross income in the usual manner. To date, Santa Clara County issued 3 MCC’s.

In November 2002, the voters of California approved a $2.1 billion bond issue to provide housing and emergency shelter to low-income persons. The money is to be allocated by the State as follows:

• $910 million for rental housing for low-income seniors, disabled persons, and families with children.
  
• $495 million for homeownership programs, including sweat equity housing and down payment assistance for low and moderate-income families.
  
• $390 million for emergency shelters and permanent housing with support services for homeless seniors, battered woman, mentally ill people and veterans.
  
• $200 million for farm worker housing (rental and ownership).
  
• $100 million for incentives for local governments to approve housing developments.
  
• $5 million for local code enforcement to revitalize neighborhoods.

Although the State has just begun the process of issuing specific guidelines for award of Proposition 46 funds, it is expected that various categories will be available to both cities and to non-profit developers through a competitive application process.

On January 28, 2003, the establishment of a new Affordable Housing Fund was approved by the Santa Clara County Board of Supervisors.

A total of $18.6 million is estimated to be available to the affordable housing fund over the next three fiscal years (FY2003-FY2005). The precise level of available funding will depend on actual receipt of funds pursuant to the County’s agreement with the City of San Jose. For purposes of the allocation strategy i.e. Capital Funding for Affordable Housing, which represent immediate project funding opportunities for the Multifamily Housing Program (MHP) Eligible and non-MHP eligible projects, funding is identified as being available in the year in which funds are expected to be received by the County:

• Year 1- -$7 million is already available and is proposed to be transferred into the Affordable Housing Fund. Only $122,109 has been appropriated; the remainder is available for allocation beginning in FY2003.
  
• Year 2- -$5.6 million is currently estimated to be available at the end of FY2003 and is assumed to be available for allocation beginning in FY2004.
  
• Year 3 - -$6 million is currently estimated to be available at the end of FY2004 and is assumed to be available for allocation beginning in FY2005.

Federal funds will be leveraged to the maximum amount possible. The City will continue to encourage non-profit developers to seek private and State sources of funding, both grants and loans. The City will also use its Housing Fund as appropriate to complement the use of federal and state funding resources to meet community development objectives.

The City continues to support several human service agencies with funding from the General Fund in order to extend the availability of federal funds. Approximately $237,000 of General Fund monies is expected to be allocated to various agencies.

The City will consider the provision of all types of housing assistance on a Citywide basis consistent with the policies of the City's Consolidated Plan. The City will be focusing on the CD Strategy areas for housing activities. Distribution of subsidized housing is located throughout the City.

All of the other programs and support services as described in the Action Plan are available Citywide. New construction or acquisition projects will be located as close to major transportation and service corridors, as practically possible.

In order to ensure the viability of all affordable housing projects, the City will continue to fund projects that provide housing-related support services. CDBG funds have been allocated for the following:

This project will receive CDBG funds in the amount of $13,060 for the purpose of providing advocacy, investigation of complaints, including allegations of abuse and neglect, and problem resolution services for the elderly and other residents with disabilities in the City’s Nursing facilities and Assisted Living/Residential Care Facilities for the Elderly.

This project will provide $16,500 to Catholic Social Services of Santa Clara County, a non-profit organization, to operate a shared housing program to primarily benefit very low to low income persons at risk of homelessness. Single-parents with children and individuals such as seniors, emancipated youth, persons with disabilities and refugees who are at risk of homelessness will be served under this program.

Clara-Mateo Alliance Shelter (CMA)

CDBG funds in the amount of $5,000 have been allocated to this agency to provide shelter and supportive services to individuals, couples and families to assist them in obtaining stable housing and self-sufficiency. Some of the supportive services include emergency services, crisis intervention, peer counseling, money management, and transportation vouchers.

Community Association for Rehabilitation (C.A.R., Inc.)

CDBG funds in the amount of $5,950 have been allocated to this agency to support the services to families and individuals who have developmental or other disabilities. C.A.R. provides an infant program, a recreation program, respite services, specialized day care for adults, job training and placement for adults and outreach and education.

CDBG funds in the amount of $14,670 have been allocated to this agency to support the rotating shelter for homeless men and to provide support services such as food, rental assistance, medical assistance, housing, job counseling, computer training and gas vouchers for the shelter clients. The Rotating Shelter Program helps homeless men secure gainful employment and permanent housing.

Sunnyvale HOMES (formerly Sunnyvale Homeless Shelter Services) is an existing program that will provide 9,500 Person Shelter Days in a Continuum of Care of housing-emergency shelter, transitional housing and permanent supported housing. This project will fund emergency housing services with CDBG funds in the amount of $58,720.

Friends for Youth will offer one-to-one mentoring services for 30 Sunnyvale youths, matching them with an adult volunteer mentor to help them stay in school and out of trouble.

Project Match, Inc., a non-profit corporation will use $8,685, to provide support services to seniors living in these group homes that includes on-gong interview; assess; refer and/or counsel low-income seniors in a group or individually and referral to needed self-care, mutual care, and or professional care services.

Funding in the amount of $5,610 will be provided to the Second Harvest Food Bank of Santa Clara County to operate the Operation Brown Bag program. The Brown Bag provides weekly food supplements to low-income seniors.

This project will provide funds in the amount of $11,030 for the program that provides free legal and advocate services to Sunnyvale seniors.

This project will provide $23,742 in CDBG funds to the First United Methodist Church of Sunnyvale-Senior Nutrition Program to provide meals to approximately 200 unduplicated seniors in Sunnyvale five days per week for 249 days during FY 2003/04. Van transportation services for those unable to travel independently is provided.

This agency provides emergency and on-going assistance to victims of domestic violence. Services include emergency shelter, family counseling, and legal guidance. Community education and training programs are also provided. $24,000 has been allocated to this agency.

This project will receive $77,533 in CDBG funding to provide emergency services including financial assistance, food and clothing for low-income residents in crisis or at risk of becoming homeless. SCS expects to serve at least 2,040 unduplicated clients during the year.

Meals on Wheels provides weekday hot meal deliveries to homebound low income seniors and disabled adults. Homebound, frail and/or disabled clients benefit from a weekday wellness check that the drivers conduct along with the meal delivery. This program will receive $12,750 in CDBG funding.

This project will fund the continuation of fair housing services provided to Sunnyvale residents. The Fair Housing Study released in January 2003 recommended that to strengthen fair housing services in Santa Clara County, there should be more regional and sub-regional collaboration. In response, the Cities of Mountain View, Palo Alto and Sunnyvale have jointly solicited competitive bids to serve Northern Santa Clara County for the 2003/04 year to obtain services that promote fair housing and investigate complaints of housing discrimination of all types, including racial, sexual, and families with children. This contract will be funded by CDBG funds for $30,000. The following summarizes the services to be provided.

Community Education and Outreach which will include education seminars and training workshops, educating potential renters and buyers, and use of local media to promote the concept of affirmative fair housing;

Advocacy and Investigation that will receive, evaluate, and process claims of housing discrimination; provide consultations, counseling and mediation/conciliation, and legal representation; and

Coalition Work and Reporting quarterly reports to be provided to the city, provide staff with technical assistance regarding Fair Housing issues and updating the AI, provide staff with information and analysis of Fair Housing legislation, represent North Santa Clara County at regional meetings, and represent North County on Fair Housing Task Force.

Action: The City will continue to keep informed of any decisions that will be made regarding State and county housing funding and county-owned land that could possibly be used for a non-profit organization to develop senior housing units.

Action: Through the City's Below Market Rate program over 737 rental and ownership units are available to moderate, low and extremely low-income households. The City continues to demonstrate its support for the development of affordable housing. Two rental developments have been approved in the City that will provide a total of 295 units. The City has also recently approved two developments by the Riding Group that will provide 9 BMR purchase units. The completion of the Magnolia Avenue Apartments has provided three more units to the City’s BMR inventory.

As a means of providing housing to first-time homebuyers, staff will look at aggressive ways to assist tenants of BMR rental units with restrictions terminating during the next five years, including ways to assist them into home ownership. The CD Strategy recommends creation of a new First-Time Homebuyer Support Program to assist qualified renters (generally 70 to 120 percent of median income), to move into first-time homeownership. The program would include: homebuyer education workshops; Independent Development Accounts (IDA), with matching contributions to downpayment savings accounts; and downpayment loans up to $25,000. During the 2003/04 PY staff will undertake the design and implementation of these activities.

Another critical housing activity that the City will continue to address is the Teacher and Public Employees Housing Program. This housing program is designed to assist qualified employees and teachers obtain housing by providing homebuyer education, security deposit loans and down payment assistance. This program created a state-of-the-art, interactive website to provide information to Santa Clara County residents on all available housing and training programs. This activity is being funded by the City Housing Fund.

Expand the level of participation in the housing rehabilitation programs of both private and non-profit property owners of both owner-occupied and rental housing.

Substantial rehabilitation to approximately 80 units of rental properties includes exterior repairs of the structure (i.e. roof, windows and doors, siding, stairs and painting), as well as electrical, heating, plumbing and replacement of appliances and flooring. The City anticipates additional funding from the HELP program of the California Housing Finance Administration (CalHFA) to leverage interest-subsidized loans from a conventional lender.

Recommended in the Community Development Strategy (discussed further in CDD Strategy section), this new program will support efforts of the single-family and multi-family action areas.

Action: The Neighborhood Improvements Program will provide funding for street trees, streetscape improvements, neighborhood clean-ups, façade and landscape designs, and other targeted projects to improve the physical appearance of the action area neighborhood.

Planned Activity: Neighborhood Education

Recommended in the Community Development Strategy (discussed further in CD Strategy section), this new program will encourage and support property maintenance and improvement in single-family and multi-family action areas.

Action: Provide property owner/manager workshops, multi-lingual newsletter to action area residents, home improvement workshops, a tool lending library and a local business resource guide.

Action: The City continues to retrofit as many curbs as possible each year so that all intersections in the City conform to ADA requirements.

The City does not anticipate being directly involved in the following programs but will be supportive of non-profit groups and the Santa Clara County Housing Authority's administration of these programs. The City does not foresee any circumstances that would prevent the City from certifying the applications of other entities that are consistent with the City's Consolidated Plan.

This program is directed towards families who are in danger of losing their children because they are homeless or have inadequate housing.

This program provides families with education, and training. The goal is that families will be off of all public assistance at the end of five to seven years, and will have accumulated a downpayment for purchase of a home.

This program helps the local housing authority relocate families so that areas of low-income and minority concentrations are desegregated.

This program assists Public Housing and Section 8 recipients in finding job opportunities and training. If there is a publicly assisted rehabilitation project it is used to develop employment training skills for people.

This program provides support services to aid the elderly in being self sufficient in their homes and preventing institutionalization.

Complementing the City’s Annual Action Plan, several activities to enhance and expand the effectiveness of city programs will be undertaken over the next five years as identified through the CD Strategy (Included as Attachment A). The following is an excerpt from the CD Strategy:

Sunnyvale has limited resources to achieve its community development goals. These include the discretionary staff hours in the budget of the Department of Community Development; funds allocated to the City each year by the federal government for community development and housing purposes; Housing Funds generated by intensive industrial development projects; some portion of the Capital Improvement Program for public buildings, streets, utilities, parks, etc.; tax increment funds generated in the Downtown Redevelopment Project; and, regulatory controls through the Zoning Code and Building Code.

The main purpose of the Community Development Strategy is to guide the use of these limited resources to achieve the maximum possible community development benefit. It is an investment strategy. It is intended to direct City investment over the next five years in a manner which will best maintain and improve the vitality of Sunnyvale and all of its neighborhoods.

A first step in the preparation of this Community Development Strategy is to identify the most critical community development issues which our city faces.

There exists no reliable data source on building condition and property maintenance. Therefore, in August through November of 2001, a windshield survey was undertaken of every property in the city. The exterior physical condition of each housing structure was recorded, from A (excellent, usually new) to F (deteriorated beyond economic repair). The quality of property maintenance was also evaluated, and violations of the Zoning Code and Property Maintenance Regulations were noted. The exterior physical condition of each commercial building was determined and, based upon the degree of functional obsolescence due to age and design, each was ranked Class A, Class B, or Class C in accordance with guidelines provided by the commercial real estate industry.

Citywide data from the 2000 Census were also analyzed, together with data released to date for Census Tracts and block groups. Crime statistics were surveyed. The level of reinvestment in residential and commercial buildings was measured through building permit data over the last decade. Economic data were assembled from Federal, State and regional agencies. Discussions were held with representatives of neighborhood associations, local businesses, commercial real estate brokers, and developers.

Housing Supply: Sunnyvale has a serious shortage of housing units relative to jobs in the city, part of the widespread shortage of housing throughout the Bay Area.

Sunnyvale currently has one housing unit for every 2.4 jobs (this number is based upon the normal rate of employment, and might be slightly lower today because of the unusually high level of unemployment). In contrast, The Association of Bay Area Governments has offered a regional standard of one housing unit for every 1.6 jobs; presumably, if this standard were achieved in Sunnyvale, there would be sufficient housing to permit all of our workers to live in the city.

Because the demand for housing units exceeds the supply, housing prices are driven up to a level which makes them unaffordable to many households. In order to find housing, and particularly housing which they can afford, many workers commute long distances every workday, contributing to traffic congestion, air quality problems, and personal stress.

In recent years the community, as reflected in the actions of its elected and appointed officials, appears to be more willing to accept increased employment density than to accept increased residential density. This propensity to accept more new jobs than new housing units will only exacerbate the local housing shortage.

Housing Affordability: Fewer than 30 percent of Sunnyvale households can afford the median priced home in the city of approximately $500,000. Twenty-nine percent of our households pay more than 30 percent of their income for housing. Over 600 units which are currently affordable could be lost through conversion to market-rate units.

The high cost of housing is the most daunting housing problem in Sunnyvale, reflecting a region-wide problem in the Bay Area. Because it is a regional problem, it cannot be adequately addressed at the local level. Nevertheless, Sunnyvale has been a model for local governments in addressing affordability issues, and we should continue to do so. Through adoption of inclusionary zoning in 1980, creation of the housing mitigation fee in 1983, and establishing housing as a priority in the use of Federal community development funds, the City has created nearly 2,000 housing units with prices which are affordable to low and very low income households.

A very special problem in housing affordability is the potential loss of "at risk" affordable units. These units were originally subsidized by the Federal government or produced under the City's inclusionary zoning (below market rate program). The federally subsidized units were required to remain affordable for a fixed period of time (generally 20 years). Similarly, units developed under inclusionary zoning were required by City ordinance to remain affordable for 20 years. Over the next five years, affordable contracts will expire for 390 federally subsidized rental units and 224 below market rate rental units. This means that 614 currently affordable rental units could be lost if they convert to market-rate rents.

Owning a home is not for everyone. Our fast-moving, highly-mobile world makes renting a better choice for many households. Nevertheless, from a municipal standpoint, homeownership represents an investment in and commitment to a community. It tends to result in a somewhat greater stability, a higher level of community participation, and often an increased and sustained level of property maintenance. The City should, therefore, promote opportunities for homeownership within the above-stated targets for housing affordability.

Housing Condition: Approximately 2,600 single-family houses, or 11 percent of the total, are in need of substantial reinvestment; nearly 4,500 multi-family housing units, or 17 percent of all multi-family units, are in need of substantial reinvestment.

Although age of housing is not, by itself, an accurate predictor of present housing condition, it is one factor that can explain current housing problems. Figure 4 depicts the present age of housing in the city. Only one percent of the present housing stock was built before 1940; not surprisingly, this is concentrated in the area of original settlement, generally between El Camino Real and the Central Expressway, and between Pastoria Avenue and Fair Oaks Avenue. Post-war housing constructed between 1940 and 1960 composes 25 percent of the present housing stock. These houses were often modest in size and quality of construction; most had only one-car garages. Unless they have benefited from substantial reinvestment, most homes constructed before 1960 are becoming functionally obsolete in the present housing market.

Compared to many other cities, the condition of housing in Sunnyvale is acceptable. All of the categories of condition, except Condition F (deteriorated beyond economical repair), are livable. Only 12 homes are rated F. Homes rated A or B are in excellent condition, often newly built or recently renovated. Condition C is average.

Problems start to become apparent in those homes rated D and E. Almost all of these homes were built prior to 1960, and most have benefited from very little reinvestment except for required maintenance. They often have original plumbing and outdated electrical service. There are 2,620 single-family homes, or 11 percent of all single-family homes in the city, which are in need of substantial rehabilitation.

The same rating system applies to the condition of multi-family housing based upon the windshield survey, from A (excellent) to F (deteriorated). Ten multi-family housing units are rated F, so deteriorated as to require demolition. Seventeen percent of the multi-family units, or 4,465 units, fall into Condition D or E, a surprisingly high number given the relatively young age of multi-family housing in the city. Most of the units in need of substantial rehabilitation are in smaller complexes, housing two to ten units. Buildings with 16 or more units are required by State law to have on-site managers, and they are generally better maintained; some notable exceptions are the large apartment complexes along Ahwanee Avenue.

Housing Supply: Ideally, to meet regional goals for jobs/housing balance, Sunnyvale should have one housing unit for each 1.6 jobs. If the City were to try to achieve this goal in five years, starting from its present ratio of one housing unit for every 2.4 jobs, it would have to build 24,000 new housing units even if not a single new job were created! This is obviously an impossible task in a fully developed city. A more achievable target would be to maintain the current ratio of housing units to jobs, thus doing our part to help Santa Clara County achieve the desired regional jobs/housing balance. The projected job growth in Sunnyvale over the next five years of 4,720 would require the construction of 2,950 new housing units.* Given the lack of vacant land, this requires the conversion of approximately 123 acres of already developed land to new housing, assuming an average R-3 density of 24 units/acre. It would be contrary to other goals of this Strategy (e.g. Homeownership, Neighborhood Preservation) to convert single-family neighborhoods into multi-family housing. Therefore, we must identify and appropriately rezone approximately 123 acres of underutilized and/or deteriorated industrial, commercial and residential property in key locations for conversion to new housing or mixed-use development.

Housing Affordability: Matching household incomes to housing prices is a most daunting task for local government. It can be achieved either by raising incomes, or by lowering housing prices. The former is practically impossible for local government; only the Federal government can effectively achieve a redistribution of income through income tax policy and through housing subsidies or welfare grants to households. Sunnyvale can help through long-range workforce skills development as discussed above in the Jobs target.

While the private market appears to be operating in some neighborhoods to reverse the pattern of neglect and deterioration, it is highly improbable that the private market will be able to achieve a noticeable improvement

in housing condition without public stimulation of some form (the "stick" of code enforcement and/or the "carrot" of low-interest rehabilitation loans). Because the needs are so great and the costs of substantial rehabilitation so high (averaging $25,000 per unit for multi-family, and $45,000 per unit for single-family), the City must concentrate its resources into action areas of need, and leverage its resources by providing catalytic or "gap" financing to attract private capital. A reasonable target for the five-year period is to eliminate all of the F-rated properties, and stimulate substantial rehabilitation of 400 multi-family and 45 single-family residential units. The emphasis on multi-family over single-family is justified by the lower cost per unit for rehabilitation, the greater ability of multi-family owners to obtain private financing, the inability of a tenant to effectuate needed improvements, and the reduced level of economic hardship on the owner.

Neighborhood Preservation: Over the past decade, the City has initiated numerous programs and regulations to protect and preserve the character of its single-family residential neighborhoods. Each has been in response to a specific concern identified by an alert neighborhood group. These City efforts include Citywide Design Guidelines, Tree Preservation Ordinance, Noise Control Ordinance, Neighborhood Traffic Calming, Single-Story Combining District, Regulation of Large Single-Family Homes, and Privacy Standards Between Residential and Non-Residential Uses. Sunnyvale’s continued success in preserving its wonderful neighborhoods is dependent upon the persistent attentiveness of its neighborhood residents and the continued timely City responsiveness to issues and problems which threaten neighborhood character and stability.

Neighborhood Improvement: A recent field survey revealed that 92% of the residential properties in the city meet community standards for property maintenance (not more than one code violation). In Lakewood Village, however, only 61% of the properties were observed to be in such a satisfactory state. Excluding Lakewood Village, the remainder of the City evidences a 95% rate, which, based on survey results, appears to be acceptable to Sunnyvale residents. To bring Lakewood Village to this level would require that 552 properties eliminate existing code violations, a target which may be achievable in ten years but not in five. A reasonable five-year target is that not less than 80% of the properties in Neighborhood Preservation District 2, which is primarily Lakewood Village, meet community standards for property maintenance.

There are a few neighborhoods of the city, however, which evidence an unusual concentration of community development challenges, or that present unique opportunities to achieve community development goals. These are identified in this chapter as proposed action areas.

Action areas demand more than the type and level of community development services currently being delivered throughout the city. They require a proactive approach to community development.

Sunnyvale has traditionally delivered community development services on a service-by-service basis. Each service has its own goals and targets, and is generally delivered in an independent manner, not necessarily coordinated with other available services. Action areas require a more concerted approach to service delivery. Programs and services must be packaged into a strategy that addresses the specific needs of the action area. The strategy for an action area must be unique to that area. Therefore, the types and amounts of community development service delivered to these areas will not be the same, and the level of service in action areas will likely be higher than is provided citywide.

The field survey indicated that 38 percent of the single-family homes are in need of substantial rehabilitation. This is over three times the citywide average of 11 percent. Thirty-nine percent of the properties have more than one violation of the property maintenance or zoning codes, which is nearly eight times the average five percent rate in all other areas of the city. Based upon 2000 Census data, only 78 percent of the single-family homes in Lakewood Village are owner-occupied.

Lakewood Village does not demonstrate an unusually high concentration of low-income households. In fact, more than half of the households have incomes exceeding $75,000, comparable to city-wide averages. Nevertheless, 28 percent of homeowners are paying more than 30 percent of their income for housing, and 27 percent of households are living in overcrowded conditions (more than 1.1 persons per room). Over 70 percent of the households are of an ethnic minority, primarily Asian.

In August 2002, Neighborhood Preservation staff initiated a pilot program of concentrated code enforcement along two streets in Lakewood Village, constituting 95 properties. Based upon early results of this program and the data and analysis cited above, the recommended strategy for Lakewood Village is a concerted effort of numerous housing and property improvement programs, focusing primarily upon concentrated code enforcement. The project should be phased over five years, completing areas totaling approximately 400 housing units each year. To be successful, residents and property owners must be fully engaged in the process, as is the case in the Pilot Program. This level of effort will require the addition of two new inspectors to the Neighborhood Preservation Division.

The strategy should include the following programs:

• Concentrated Code Enforcement, similar to that in the Pilot Program.
• Single-Family Housing Rehabilitation, wherein low-interest loans are made available for properties housing families with income at or below 80 percent of median income.
• Paint Grants and Loans to assist in the acquisition of painting materials and to allow elderly homeowners to hire contractors to paint the exterior of their homes.
• Neighborhood Improvements, including streetscape improvements, neighborhood clean-ups, model façade and landscape designs, front yard landscaping through group buying or business contributions, and other targeted projects to improve the physical appearance of the individual properties and the neighborhood.
• Neighborhood Education, including home improvement workshops and a tool lending library.
• Rental Housing Inspection to insure that rented homes remain safe and sound.

Victory Village:

Victory Village is a compact area of single-family homes located close to the geographic center of Sunnyvale. All of the housing stock was constructed during the 1940s specifically to house workers at the nearby Hendy Ironworks. The homes, although originally well-built, are modest structures ranging from 800 to 1,000 square feet. The age of the housing (50+ years), combined with the limited expendable income of the occupants, has contributed to the deterioration of the housing stock.

The field survey indicated that 69 percent of the homes in Victory Village are in need of substantial rehabilitation, one of the highest of any neighborhood in the city. Nineteen percent of the properties have more than one violation of the zoning or property maintenance codes. Based upon 2000 Census data, 75 percent of the units are owner-occupied. Although 59 percent of households have incomes over $75,000, 22 percent of homeowners are paying more than 30 percent of their income for housing.

Like the strategy for Lakewood Village, the strategy for Victory Village is a concerted effort of numerous housing programs; however, because in this case it is housing condition rather than property maintenance which is the primary problem, the strategy is focused primarily upon housing rehabilitation. Neighborhood residents and property owners must be fully engaged in the process. The strategy should include the following programs:

• Single-Family Housing Rehabilitation.
• Concentrated Code Enforcement.
• Paint Grants and Loans, to assist in painting the exterior of homes.
• Neighborhood Improvements, including neighborhood clean-ups and model façade and landscape designs.
• Neighborhood Education to assist homeowners with home improvements.
• Rental Housing Inspection.

The Ahwanee area parallels the west side of the 101 Freeway from Fair Oaks to Mathilda. The area contains several large parcels of single-story rental units. Many of the multi-family buildings are converted motels. The motels that were constructed during the 1940s to 1960s were bypassed when 101 became a freeway. The current housing densities are very low; the total area of 21.6 acres currently contains 471 units. The General Plan would support construction of up to 900 residential units in the area.

Since most of the housing was built as motel rooms, the unit sizes are generally substandard. Census data indicate that 39 percent of the renter households are living in overcrowded conditions. Thirty-six percent of the population is under the age of 24, which indicates that many families with children are living in these overcrowded units; 26 percent of the households are categorized as large families (five or more persons per household). Eleven percent of those persons living in the area are below poverty level, according to Census data, indicating the highest concentration of persons in poverty in Sunnyvale. Forty-one percent of the residents are Hispanic.

The field survey indicated that more than 52 percent of the housing stock is in need of substantial rehabilitation. The housing in this area is clearly housing of last resort, occupied by Sunnyvale's working poor families, in overcrowded and substandard conditions.

The strategy for this action area is for the development and redevelopment of affordable rental housing. The City will actively seek partnerships with non-profit agencies to acquire land for development of reasonably priced rental housing units. Rental units should focus on providing housing to households from 30 to 80 percent of median income, with rent limited to 30 percent of gross household income. Nevertheless, the increase in density should allow for mixed-income projects, so that the area does not remain a concentration of low-income households. Family housing to provide adequately sized units for large families should be encouraged.

The strategy should include the following programs:

• Acquisition and Construction Projects.
  
• Acquisition and Rehabilitation Projects.
  
• Rental Housing Inspection, a proposed citywide program, should have priority in this area.
  
• Neighborhood Improvements, particularly street trees.
  
• Rezoning to General Plan density as quality projects are submitted for entitlement.
  
  San Juan:

The San Juan multi-family housing action area is located just west of the San Miguel single-family neighborhood. Most of the housing stock was constructed during the late 1950s. There is a mix of styles and types of complexes, ranging from 4-plexes to 12-plexes, all of similar 1950s architecture. In addition, there are many detached duplex units, and two large complexes of studio-type single-story apartments. All of the structures, when originally built, were modest lower-cost rental units.

Census data indicate that median income for this area is at $60,450, which is at or below low-income in Sunnyvale. Six percent of the population is below the poverty level and 36 percent are Hispanic. Census data indicate that 47 percent of the households are living in overcrowded conditions. More than 38 percent of the residents in the area are under 24 years of age, indicating that many of the households are families with children, often living in overcrowded conditions. More than 23 percent of renter households are large families (consisting of five or more persons per household).

A total of 61 percent of the housing stock was determined through the field survey to be in need of substantial rehabilitation. Conditions inside the units may be worse than exterior appearances.

The strategy for the San Juan neighborhood is focused on multi-family housing rehabilitation and reconstruction. The City will actively seek partnerships with non-profit agencies to acquire existing apartment units for substantial rehabilitation or demolition and replacement with new rental housing. These new or rehabilitated apartments should focus on serving households at 30 to 80 percent of median income, with rents limited to 30 percent of gross household income. Family housing of adequate size for large families should be encouraged.

Special attention should be given to the duplex units in the northern part of the area. The City will actively seek partnerships with non-profit agencies to acquire the duplex units on a parcel-by-parcel basis, rehabilitate them, and then subdivide them for sale to two first-time homeowner families with incomes in the range of 70 to 120 percent of median. This will support our goal to provide increased opportunities for homeownership.

The strategy for San Juan should include the following programs:

The eastern part of the HOLA neighborhood, between Bayview and Fair Oaks, is predominantly multi-family housing. The housing is relatively new, with the original construction ranging from the 1960s to the 1980s. There is a wide mix of styles and sizes, but most of the apartment buildings consist of six to eight units, too few to require or economically justify on-site management. The physical conditions reflect this lack of on-site management, together with lack of a routine maintenance schedule and inadequate reserves for major repairs. The field survey indicated that 60 percent of the housing stock is in need of substantial rehabilitation.

Census data indicate that median household income in this portion of HOLA ranges from $51, 500 to $75, 666, which is at or below the low-income level for Sunnyvale. More than 31 percent of the population is under 24 years of age, and 36 percent of the families are living in overcrowded conditions. 34 percent of the population is Hispanic.

The strategy for the eastern part of HOLA is targeted multi-family housing rehabilitation. Because of their relatively young age and less severe deterioration, practically none of the apartments need to be demolished and replaced. The City will work with existing owners to encourage substantial rehabilitation, and actively seek partnerships with non-profit agencies to acquire properties for rehabilitation. Opportunities exist in this area for condominium conversion to allow renters with household income between 70 and 120 percent of median to achieve homeownership, in support of our goal to provide increased opportunities for owner-occupied housing. Rehabilitated rental units should be focused on providing housing for households from 30 to 80 percent of median income, with rents limited to 30 percent of gross household income.

The strategy for the eastern part of HOLA should include the following programs:

An ad hoc task force is assembled as needed to solve a business problem, to collaborate on business development efforts, or to advocate a position to a public agency or governing body. It is made up of experts and senior decision-makers from public and private sector organizations, including City, County and State governments, public utilities, and affected businesses.

Funding for this program is from the operating budget of the Economic Prosperity Program.

This is a recommended new program of this Community Development Strategy. A business improvement district (BID) is formed cooperatively by the City and by a majority of the property owners and/or business owners in a geographically defined area in order to provide an extra level of common area services (e.g., sidewalk cleaning, parking enforcement, cooperative advertising, etc.) It is supported by an added tax or fee imposed upon all properties and/or businesses in the area, which tax or fee is approved by a majority of the property and/or business owners.

The City's start-up costs of approximately $60,000 per business improvement district would be included in the Projects Budget. Once initiated, a business improvement district would be self-sustaining through the tax or fee levied upon owners of property and/or businesses in the district.

The following activities to be undertaken over the next five years, although new and/or expanded, will be responsive to the established goals in the City’s Consolidated Plan 2000-2005 (italicized), also address identified goals and actions in the City’s Revitalization efforts.

Provide loans to non-profit agencies to acquire land for new construction of reasonably priced rental units. Rental units focus on providing housing to households at 30%-80% of median income with rents limited to a maximum of 30% of gross household income. This can also apply to mixed-income projects, where only a portion of the units are reserved as affordable.

Amount: $1,250,000 *Source: HOME
Number of Units: 50 Average Cost: $25,000

Provide loans to non-profits for the acquisition (and assembly) of existing rental properties in order to preserve affordability and to provide professional management and maintenance of existing properties.

Amount: $2,900,000 *Source: CDBG ($1,250,000)
City Housing Mitigation Fee ($1,650,000)
Number of Units: 116 Average Cost: $25,000

This is a recommended new program to address the goal to encourage homeownership. Interim financing would be made available to public/private developers for the acquisition of land and/or existing housing for development of homeownership units for households with incomes from 70 to 120 percent of median.

Amount: $1,250,000 *Source: City Housing Mitigation Fee
Number of Units: 50 Average Cost: $25,000

Sunnyvale initiated inclusionary zoning in 1980. Commonly known as the below market rate (BMR) program, it has required developers of multi-family housing of ten or more units to set aside 10% of the units to be affordable to low and middle-income households. On January 28, 2003, partially in response to the draft of this Community Development Strategy, the City Council amended the below market rate program to require that 12.5% of all new for-sale housing be affordable, and that the affordable requirement for rental development be increased from 10% to 15% when the rental market rebounds. The program was also amended to extend the period of affordability to 30 years for owner-occupied units, and to 55 years for rental units.

Substantial rehabilitation of owner-occupied, single-family homes includes repairs to the exterior envelope of the structure (i.e. roof, windows and doors, siding, foundation and painting), the major component systems (i.e. electrical, heating and plumbing) and the interior functional components (i.e. appliances, flooring and interior painting).

Amount: $2,025,000 Source: Community Development Block Grant
Number of Units: 45 Average Cost: $45,000 per unit

Substantial rehabilitation of rental properties includes repairs to the exterior envelope of the structure (i.e. roof, windows and doors, siding, stairs and painting), the major component systems (i.e. electrical, heating and plumbing) and the interior functional components (i.e. appliances, flooring and interior painting).

Amount: $10,000,000* Source: Community Development Block Grant ($500,000)
Number of Units: 400 Average Cost: $25,000 per unit

* Assumes additional funding of $2,000,000 from HELP program of the California Housing Finance Administration. Funding would be used to leverage $9.5 million of interest-subsidized loans from a conventional lender.

Paint Grants and Loans:

To provide assistance to single-family residential owners to paint the exterior of their homes. This program provides loans to age 60+ homeowners of up to $4,000 to have a licensed painting contractor following HUD lead-safe work practices paint the home. Lead testing of all pre-1978 homes will be undertaken. Grants of up to $1,000 will be provided to homeowners under 60 for reimbursement of paint material and testing costs for the painting of their home.

Amount: $250,000 Source: Community Development Block Grant
Number of Units: 100 Average Cost: 50 @$1,000 and 50 @$4,000; $2,500 per unit

Provides minor repairs and access lifts to increase accessibility for residents with physical challenges. Over the next five years the program will be limited to the reuse of the City’s existing inventory of lifts and the provision of accessible home improvements of up to $2,000 per residence.

Amount: $100,000 Source: Community Development Block Grant
Number of Units: 100 Average Cost: 50@$2,000

This Community Development Strategy recommends a new program to provide loans to preserve the affordability of existing rental projects that are at risk of conversion to market rate due to termination of contracts with HUD.

Amount: $2,240,000 Source: CDBG ($500,000); HOME($1,500,000);City Housing Fund ($240,000)
Number of Units: 160 Average Cost: $14,000
Potential Additional Funding Source: Proposition 46 Funds

This Community Development Strategy recommends a new program to provide loans to maintain below market rate units in rental projects that are at risk of conversion to market rate due to expiration of their 20-year restriction.

Amount: $2,000,000 Source: City Housing Fund
Number of Units: 160 Average Cost: $50,000

In addition to the citywide enforcement of zoning and property maintenance regulations by the Neighborhood Preservation Division, this Community Development Strategy recommends creation of a Concentrated Code Enforcement Program based upon the Lakewood Village Pilot Program. This program would designate a target area and work proactively with each resident and property-owner in the area to correct all code violations and to make other aesthetic improvements to properties and to the neighborhood (e.g., front yard landscaping, street trees, sidewalk repairs).

Amount: $278,000/year Source: General Fund
Number of Units: 400/year Ave. Cost: $695 per unit

This Community Development Strategy recommends creation of a Rental Housing Inspection Program designed to insure that all rental units in the city remain in safe and sound condition. Building Division inspectors would inspect every rental unit at least once every five years to enforce building and fire codes; flagrant health violations would be referred to the County Health Department. Although many other cities have such programs (including Mountain View, and Hayward in this area), the introduction of such a program in Sunnyvale is likely to be controversial. Experience shows that one inspector can inspect 1,500 units per year. The program is usually self-supporting through a small annual per-unit fee charged to rental property owners.

Amount: $640,000/year Source: Fee of $22.00/unit/year
Number of Units: 5,820/year Ave. Cost: $110 per unit

This Community Development Strategy recommends this new program to support efforts of the single-family and multi-family action areas. The Neighborhood Improvements Program will provide funding for street trees, streetscape improvements, neighborhood clean-ups, facade and landscape designs, and other targeted projects to improve the physical appearance of the action area neighborhood.

Amount: $375,000 Source: CDBG
Number of Units Benefited: 150 Average Cost: $2,500 per unit benefited

This Community Development Strategy recommends a new Neighborhood Education Program to encourage and support property maintenance and improvement in single-family and multi-family action areas, including:

• Property owner/manager workshops on good management techniques (including tenant screening), the Section 8 program, and fair housing compliance.
  
• Multi-lingual newsletter to action area residents providing resource information.
  
• Home Improvement Workshops provided by City staff and local suppliers to expand knowledge and promote improvements and maintenance of property.
  
• A Tool Lending Library to provide owners and renters with tools and equipment to perform home improvement projects.

• A local business resource guide that identifies businesses who are committed to partnering in the neighborhood improvement process.

The Sunnyvale condominium conversion ordinance permits conversion of apartment buildings to for-sale condominiums only when the vacancy rate in the city exceeds three percent. This is intended to protect affordable rental units from conversion to more costly sales units. In order to support our Homeownership goal, consideration should be given to altering the condominium conversion ordinance to allow conversion, regardless of the citywide vacancy rate, if the conversion is by a non-profit agency which will relocate any displaced tenants into affordable rental housing and place purchase and sale controls on the new condominium units to insure their continual affordability to buyers with income between 70 and 120 percent of median.

This Community Development Strategy recommends creation of a new First-Time Homebuyer Support Program to assist qualified renters (generally 70 to 120 percent of median income), particularly those in existing BMR at-risk apartments, to move into first-time homeownership. The program would include: homebuyer education workshops; Independent Development Accounts (IDA), with matching contributions to downpayment savings accounts; and, downpayment loans up to $25,000.

Amount: $60,000 Source: BMR In-Lieu Fees
Number of Units: 60 classes Average Cost: $1,000

Amount: $300,000 Source: BMR In-Lieu Fees
Number of Units: 30 Average Cost: $10,000

Amount: $1,250,000 Source: BMR In-Lieu Fees
Number of Units: 50 Average Cost: $25,000

Potential Additional Funding Sources: Partnerships with Silicon Valley Manufacturers Group, Santa Clara County Housing Trust Fund, and Proposition 46 Funds.