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Mayor’s office updates committee on 2015 affordable housing bond and PASS preservation lending program
Summary
City housing officials reported progress on the 2015 $310 million affordable housing bond and described the PASS preservation and seismic-safety loan program; members asked for clearer unit accounting, bond wording in reports and repayment projections for deferred loans.
City housing officials briefed the committee on the status of the 2015 affordable housing bond and the PASS (Preservation and Seismic Safety) financing program that offers below-market, long-term loans to preserve existing affordable rental buildings.
Rally Catapang, finance manager at the Mayor’s Office of Housing and Community Development (MOHCD), told commissioners the 2015 bond authorized $310 million. Two issuances have closed ($75 million and $142 million) and the office expects a final third issuance in late summer or early fall. Catapang said the bond funds are split across public housing, low-income housing (with a Mission District set-aside) and middle-income housing; she reported that of the roughly 1,501 projected units tied to the bond, 43% are in predevelopment, 52% in construction and 5% completed.
Jonah Lee, director of portfolio management and preservation, described the PASS debt product, which provides low-cost, long-term financing for acquisition, rehabilitation, seismic upgrades and preservation of affordable housing (new construction is not eligible). Lee presented a financing example — a 86-unit Tenderloin project — showing PASS terms increase supportable senior financing versus conventional loans (in his example raising supportable debt from about $8.8 million to more than $13 million).
Committee members asked for more granular reporting. They requested that future MOHCD bond reports include the exact bond wording, annotated explanations of unit-count changes and reallocations (for example when funds shift from one site to another), and projections of expected loan-repayment cash flows for deferred/residual-receipt loans. Kate Hartley, director of MOHCD, said the bond language targeted small sites and public housing preservation and that MOHCD will add clearer notes and links to the annual report and HUD-mandated five-year plan in future updates.
Members also pressed for metrics and targets (for example the program-level preservation target of about 1,400 apartments mentioned in the presentation) and for a clearer explanation of how bond proceeds, loan repayments and other housing funds work together. MOHCD said repayments are reallocated to affordable-housing uses under the same restrictions as the original bond and that they will add an annual repayment and projection table to future reports.
The committee asked MOHCD to provide more conspicuous change notes in the bond report so commissioners can more easily track projects that were deferred, re-scoped or had funds reallocated. MOHCD agreed to add those annotations and to provide additional links and context in the next report.
