Board gives staff direction to explore county guarantor role for Madison Road supportive housing project

The Orange County Board of Supervisors gave staff direction June 10 to continue work toward a structure that would allow the county to act as guarantor for the Madison Road supportive housing project sponsored by Encompass Community Supports.

County staff explained the guarantor role is a technical requirement tied to low-income housing tax-credit financing and that Encompass, as a community-services provider, lacks the legal structure to be the guarantor. Staff said options such as a regional housing authority were explored but no partner jurisdiction was available.

County staff and Encompass representatives described the scope of a guarantor's responsibilities: assuring the development is completed per plans, guaranteeing payment to contractors (with the project requiring a 100% payment and performance bond from the general contractor), ensuring the tax credits are delivered to investors, and maintaining low-income compliance over an approximate 15-year compliance period.

Encompass representatives said the project would not require county capital up-front and that safeguards such as payment/performance bonds and operational compliance provisions are standard. Encompass also said it would operate the voucher program for the site and propose a client-selection process that gives priority to Orange County residents and the most vulnerable clients.

A board member said the proposal looked favorable and that costs and derelict-property consequences would be significant if the board did not pursue the opportunity; after discussion the board provided consensus for staff to proceed to develop legal documents and next steps. No formal vote was taken at the meeting; staff will prepare documents for future board action.