Agda Pkt 2026.05.11 Joint SA PFA

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Page 2 of 4 City of Redwood City 1017 Middlefield Road, Redwood City, CA. 94063 Tel: 650-780-7000 www.redwoodcity.org either convert market-rate units to deed-restricted affordable units or preserve the affordability of units with existing regulatory requirements expiring in the next five years. On August 26, 2024, the City Council approved amendments to the guidelines and revised the template loan documents which included several minor clean-up edits as well as some more substantive amendments including granting the City Manager the authority to approve modifications to the insurance requirements, updating the local preference requirements, aligning requirements with the City’s Affordable Housing Program Guidelines, and changes to replacement reserve requirements. On June 6, 2025, the City, in collaboration with the Housing Endowment and Regional Trust (HEART) of San Mateo County, and its affiliate HEART-SV, successfully completed its first HPP project for the preservation of an 8-unit apartment building located at 417 Stambaugh Street. The City provided an approximately $1.2M loan to the project and placed deed restrictions on four of the eight units for 55 years, one unit at 30% of the Area Median Income (AMI), two units at 60% AMI, and one unit at 80% AMI. The remaining four units are available to households making between 80% to 120% of AMI, but the effective rents for these units are being offered at 60% to 80% of AMI. With the completion of this project, approximately $5.8 million remains available in HPP funds. In Summer 2025, the City launched an online application system for the HPP through Neighborly Software. On January 29, 2026, the City Manager administratively approved minor amendments to the guidelines to align with the new online application process. Following the first HPP project, staff identified additional necessary amendments to the guidelines and the template loan documents to further clarify and modify certain loan terms and streamline future applications. Per the HPP guidelines, the proposed amendments are considered substantive and require City Council approval. ANALYSIS Housing Preservation Program Guidelines Amendments The City’s loan terms currently require loan repayments equal to 50% of residual receipts. Staff proposes changing the residual receipts loan repayment requirement from 50% to the City’s pro-rata share of residual receipts calculated based upon the principal balance of all residual receipt loans that fund the project. By removing the fixed percentage, the loan repayments will accurately reflect the City’s true share of all residual receipt loans in future projects. Template Loan Documents Amendments There are a few substantive amendments and some minor clarifications made throughout the template loan documents. The most substantive of these amendments include the following: 1. To align with the edit to the guidelines listed above, the following changes were made: i.Section 101 “Definitions” of the Loan Agreement - edited the “City Share of Residual Receipts” definition to replace the “50%” requirement with a fillable space. 7.F. - Page 2 of 112 123