Mayor and Members of the City Council:

Richmond Housing Authority Executive Director Tim Jones has provided the following update concerning the Hacienda Demolition/Disposition Application:

A draft of the Hacienda Disposition Application has been completed and submitted to HUD. Based on this submittal, HUD has frozen the Public Housing Information Center (PIC) data for the site in anticipation of the Demolition/Disposition Application approval. The significance of this action is that the Authority can no longer move residents into the Hacienda, nor can the Authority relocate residents who are already residing in the Hacienda from one unit to another unit within the development.

After HUD's preliminary review of the Demolition/Disposition Application some rehabilitation items and their associated costs were deleted pending further explanation. HUD opined that, normally, unit renovations do not include structural work such as pilings, footings or other underground work.  If there are structural deficiencies in the mid- rise, a professional engineer in the State of California has to submit a report sealed and signed explaining the deficiencies or structural failures to be considered.

HUD further opined that items for unit renovations may only include those within the building, and only the landscapes of up to 5 feet from the building walls can be associated with the building renovations costs. Additionally, expenses related to asbestos abatement or lead-based paint has to be recommended  by a professional if the expense for abatement is excessive. Upon conclusion of their preliminary review, HUD adjusted the rehabilitation costs down and the renovations came up to 36.5% of the TDC (total development cost).

As a reminder, HUD's Demolition/Disposition Application approval is contingent upon a development having mandatory rehabilitation cost in excess of 62% of TDC for the Hacienda building type and location. Staff is working with engineering and physical needs consultants to justify a higher level of obsolescence.  We believe that additional information regarding the foundation and structural needs, requisite hazmat abatement, and fire life and safety issues will warrant higher assessments that would allow the project to clear the 62% of TDC obsolescence threshold. Once this issue is cleared, staff can submit a final version of the application for HUD for approval. We will submit the updated information for HUD's final review no later than mid­-week of September 15, 2014.

Finally, on August 20, 2014, as directed by the Housing Authority Board of Commissioners we conducted a Power Point presentation for the residents of Hacienda to explain the Demolition/ Disposition process. We'll provide further updates on the application process to the Housing Advisory Commission as additional information becomes available.

Please feel free to contact me if you have any questions or require any additional information.

Sincerely,

Bill Lindsay

Bill Lindsay
City Manager
City of Richmond
450 Civic Center Plaza
Richmond, California 94804
(510) 620-6512
Bill_lindsay@ci.richmond.ca.us

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