That the City Council approve the Second Amendment to the Permanent Local Housing Allocation Agreement between the City of La Habra and the County of Orange and authorize the City Manager to execute the Agreement.

In 2017, Governor Jerry Brown signed a 15-bill housing package aimed at addressing the State of California's housing shortage and high housing costs.  Specifically, it included the Building Homes and Jobs Act (SB 2, 2017), which established a $75 recording fee on real estate documents. The fees collected through SB 2 would be redistributed to activities to increase the supply of affordable homes in California.

The State Department of Housing and Community Development (HCD) created several new grant programs to disburse the funds being collected from this new revenue source, including the Permanent Local Housing Allocation (PLHA) program. The purpose of the PLHA program is to provide a permanent source of funding to all local governments in California to help cities and counties implement plans to increase the affordable housing stock. 

In 2019, HCD issued the final guidelines for PLHA funding. Under these guidelines, two or more local governments may expend PLHA funds on eligible jointly funded projects, provided the project is an eligible activity pursuant to Health and Safety Code § 50470(b)(2)(B)(ii)(IV) and will be located within the boundaries of one of the local governments. The cities within the North Service Planning Area in Orange County (Brea, Buena Park, Cypress, Fullerton, La Habra, La Palma, Los Alamitos, Orange, Placentia, Stanton, Villa Park, and Yorba Linda), partnered with the County of Orange ("County" or "OC") to contribute some or all of their PLHA funding to help build and operate two Navigation Centers in the cities of Bunea Park and Placentia to provide for homeless services and sheltering.

In 2020, in order to streamline the distribution of the North Service Planning Area (NSPA) PLHA funds to the two navigation centers, the City of La Habra ("City") agreed to be designated as Treasurer for the jointly funded project. The City's administration of the NSPA PLHA funding was memorialized between the City and County in the "Permanent Local Housing Allocation Agreement between the City of La Habra and the County of Orange" in July 2020 ("Agreement"). Among other things, the Agreement designated OC Community Resources ("OCCR") as the County agency authorized to execute the Agreement and receive notices and communications. The Agreement is attached to this staff report. 

In October 2021, the City and the County entered into Amendment Number 1 to the Agreement ("Amendment 1").  This amendment replaced the OCCR with the OC Health Care Agency as the lead County Agency responsible for managing the Agreement and all of its associated responsibilities.  Amendment 1 is attached to the staff report. The Agreement and Amendment 1 are both set to expire on June 30, 2025.

The proposed Second Amendment to the Agreement (Amendment 2) will add a PLHA Program funding chart that outlines final allocations and updated expenditures deadlines:

 

PHLA Program Funding

Activities		FY 2020-21	FY 2021-22	FY 2022-23	FY 2023-24	FY 2024-25	Actual
	Expenditure Deadline	4/30/24	4/30/25	4/30/26	4/30/27	4/30/28
		PLHA Actual	PLHA Actual	PLHA Actual	PLHA Actual	PLHA Actual	5-YR Funding
	Urban County/City	Year 1	Year 2	Year 3 - Rounded	Year 4 - Rounded	Year 5 - Rounded	Total - Rounded
	Jurisdictions	$1,272,164	$1,977,337	$2,175,998	$1,090,616	$835,919	$7,352,034
Six North SPA Jointly Funded Projects via County of Orange	Brea	$103,095	$160,241	$174,080	$54,531	$41,796	$533,743
	Cypress	$126,470	$196,573	$217,600	$65,437	$50,155	$656,235
	La Palma	$42,862	$66,621	$65,280	$21,812	$50,155	$213,293
	Los Alamitos	$28,047	$43,594	$43,250	$10,906	$8,359	$134,426
	Stanton	$271,818	$422,489	$456,960	$141,780	$108,669	$1,401,716
	Villa Park	$7,042	$10,947	$0	$10,906	$8,359	$37,254

Amendment 2 will also transfer the County's responsibility under the Agreement, as amended, to the County's Office of Care Coordination (OCC) and extends the term of the Agreement to June 30, 2030.

Amendment 2 has no impact on the City's General Fund. The Agreement, as amended by Amendments 1 and 2, is specifically for the County's PLHA funds to cover costs associated with the navigation centers in Buena Park and Placentia.

Amendment 2 implements the following General Plan policies:
H 1.1 Support State Hosing Policy
H 1.4 Variety of Housing
H 3.4 Special Needs Housing
H 3.5 Special Needs of the Homeless

Amendment 2 implements the following City Council Goal and Objective:
Goal 2 - Management of Public Revenues and Fiscal Assets
Objective B: Regularly review and evaluate programs, services, and professional agreements to assess effectiveness and identify opportunities for greater efficiencies and cost containment.