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6.L.- Page 2of5 provide affordable housing to extremely -low to moderate income households. However, the Affordable Housing Fund also includes revenue from the City's Affordable Housing Impact Fee. Pursuant to the Mitigation Fee Act, impact fees should be kept in a separate fund to avoid commingling with other revenues. Additionally, under AB 1717 Prepaid Wireless Utility Tax, the City collects taxes from prepaid wireless customers and in 2015, the City Council adopted Resolution No. 15427 earmarking these funds for affordable housing purposes. Currently, the prepaid wireless tax funds are in the Housing In -Lieu Fees and Other Revenues fund. The Housing In -Lieu Fees fund also includes in -lieu fees the City collects pursuant to the Affordable Housing Ordinance. The City's past practice has been to establish revenue funds by ordinance adoption. This is also consistent with State law requirements that moneys received from sales and use taxes shall be paid into either the General Fund, or into a special fund established by ordinance (Govt. § 43401). In keeping with past practice, staff is recommending the creation of three different funds, via ordinance, to properly account for specific funds related to the City's CDBG, HOME, short-term rental TOT and prepaid wireless utility tax. ANALYSIS At the May 18, 2020 City Council Meeting, the City Council approved waiving the first reading and introduced an ordinance adding Sections 2.41.16 through 2.41.18 to Chapter 2, Article IV of the Redwood City Municipal Code. The Ordinance adds: 1. Section 2.41.16 to the Redwood City Municipal Code that establishes a new Special Revenue Fund called CDBG Fund for the accounting and administration of the City's CDBG funds, and 2. Section 2.41.17 to the Redwood City Municipal Code that establishes anew Special Revenue Fun called the HOME Fund for the accounting and administration of the City's HOME funds, and 3. Section 2.41.18 to the Redwood City Municipal Code that establishes a new Special Revenue Fund called Housing Support Fund for the deposit of Transient Occupancy Taxes collected from short-term rental uses, AB 1717 Prepaid Wireless Utility taxes, and other monies designated by resolution. The monies in this fund are for the purposes of providing housing affordable to extremely low income, very low income, lower income, and moderate income households in the City and for administration and compliance monitoring of the affordable housing program. If adopted, this ordinance will be effective 30 days from this action. FISCAL IMPACT None, as this is only for accounting purposes. Page 2 of 3 City of Redwood City 1017 Middlefield Road, Redwood City, CA. 94063 Tel: 650-780-7000 www.redwoodcity.ore 435