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City of Napa housing division revamps rental housing rehabilitation loan program

City of Napa Housing Authority sign

The city of Napa Housing Division revamped the city's Rental Housing Rehabilitation Loan Program this month. 

The city of Napa’s housing division this month revamped the city’s Rental Housing Rehabilitation Loan Program, which provides financial and technical services to landlords looking to refurbish affordable rental units in the city.   

As a result, loan maximums have been increased by tens of thousands of dollars, in most cases, per unit. (The maximum loan allowed for a single-family rental unit, for example, is now $75,000, up from $45,000.)

“The rental rehab program had lower loan limits before, so if you had a rental property prior to us changing the guidelines you could only borrow a smaller amount,” said Lark Ferrell, city of Napa housing manager. “It was kind of behind what made sense.”

The city’s housing rehabilitation program provides no-interest grants and loans for home repairs. It serves low-income residents and families at or below 80% of the area median income and the landlords that rent to them. (Napa’s area median income is currently $109,200, according to the California Department of Housing and Community Development.)

The purpose of the program is to improve and grow the number of affordable rental housing units in the city, according to the updated guidelines.

Ferrell said the housing division also raised rent limits for properties eligible for the program. Rents for eligible units need to fall below 30% of 80% — instead of 60% — of the AMI, adjusted for household size appropriate to unit size. That means the maximum monthly affordable rent for a studio is $1,576, for example.

“One of the things we were looking at was what amount of rent can we restrict the property to,” Ferrell said. “Increasing the maximum rent charged will assist the program. We’d like to keep it affordable. But we also acknowledge that landlords have had a tough time and an affordable rent could be below what they can afford.”

Landlords who borrow from the program are required to enter into an agreement with the city that ensures the rehabilitated units remain affordable and are leased to low-income households for either 10 or 20 years. The 10-year agreements are another change tied to the updated guidelines; landlords were previously restricted to 20-year agreements.

The updated guidelines note, however, that going with the 10-year option may trigger the requirement to pay prevailing wages under state law, which can increase project costs. (Under state law, affordable projects are only exempt from prevailing wage requirements if at least 40% of the project units are restricted for low-income people for at least 20 years, according to the guidelines.)

Along the same lines of improving affordable housing, the housing division is also now offering Tenant Accessibility ADA Grants of up to $5,000 to make rental units accessible for a person with disabilities. The grants may be used for various Americans with Disabilities Act improvements, such as widening doorways, relocating electrical switches and outlets, adding transitional floor coverings, ramps, or grab bars and modifying kitchen cabinets or washrooms.

Tenants of the units must also have a household income at or below 80% of AMI to be eligible for the ADA grants. And landlords must agree not to require tenants to remove the improvements at the end of their tenancy, according to a city press release.

Both programs are funded by the United States Department of Housing and Urban Development’s Community Development Block Grant (CDBG) program.

You can reach Edward Booth at (707) 256-2213.

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