Received Sep 1 i-?012 By: _

Published: September 04, 2012 16 pages

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Findings and Recommendations 2 findings

LHCDC loan agreements gave Santa Barbara County, as the lead entity in the HUD HOME Consortium, authority to require audits and inspect the organization's records. City Response: Although the City of Lompoc agrees with this finding, the City's response is that finding does not apply to the City of Lompoc and it is not appropriate for the City to respond to that finding. In its August 14, 2012 response to the Grand Jury, the Board of Supervisors agreed with that finding.

Related Recommendations (1)

R1b

That the Lompoc City Council (Council) establish a policy that the Management Services Director conduct an annual audit, with time certain deadlines, of all organizations that receive City funds in excess of $50,000.

The Lompoc Redevelopment Agency (Agency) did not enforce the restrictive covenants on Lompoc Housing and Community Development Corporation (LHCDC) property. Official notices of noncompliance did not enunciate consequences nor did the Redevelopment Agency (Agency) Board of Directors take action when it had the opportunity. City Response: The Agency disagrees with this finding. The Agency worked diligently to enforce the restrictive covenants on the properties owned and operated by LHCDC. The efforts of the Agency through its staff have been demonstrated by the documentation presented to the Grand Jury, some of which was included on of the Grand Jury Report. '

Related Recommendations (1)

R2b

That the City of Lompoc Management Services Director report the results of these audits annually to the City Council prior to budget approval.

Conclusions 1

CL1

Although the recommended City Council policy has specified the types of organizations subject to it, the City of Lompoc has outlined a policy that embodies the intention of each Grand Jury recommendation such that when non-profit organizations are provided public monies by means of loans and grants for vital public services and pur,poses, how that public funding is distributed, used and accounted for results in the retention of the public's trust. The City Council policy regarding non-profits that receive City funding of more than $50,000 or with annual budgets of $100,000 or more will result in procedures that protect those expenditures and ensure accountability by the non-profit and the City and regain the public's trust. These recommendations, along with a well structured system designed to provide checks and internal controls will assist the City of Lompoc in safeguarding limited public resources. The established policy will be forwarded to the Grand Jury upon adoption. The above concludes the City's response to the Grand Jury's Report entitled, "A Failure of Oversight - Lompoc Housing and Community Development Corporation." The City respectfully submits this response to the Grand Jury and graciously appreciates all 0' their efforts associated with this 2011-2012 Grand Jury Report. September 4, 2012 Response to the Grand Jury Report: A Failure of Oversight Page 14 of 14 For additional information or questions regarding this response, please contact Linda Wertman, Redevelopment Coordinator of the Successor Agency of the (dissolved) former Lompoc Redevelopment Agency at (805) 875-8278 or via e-mail at I wertman@ci.lompoc.ca.us, Teresa Gallavan, Economic Development Director and Assistant City Administrator of the City of Lompoc at (805) 871-8274 or via e-mail at t gallavan@ci.lompoc.ca.us or Brad Wilkie, Management Services Director and Finance Director of the City of Lompoc at (805) 875-8271 or via e-mail at b wilkie@ci.lompoc.ca.us. Respectfully submitted, ;:£-c~a~~ Jol)~ H. Linn, Mayor Caurel M. Barcelona, City Administrator City of Lompoc City of Lompoc Attachment: Lompoc RDA, Redevelopment Housing Loan Covenants Report as of 10/15/09 cc: Santa Barbara County Grand Jury County Administration Building 1100 Anacapa Street Santa Barbara, CA 93101 (via certified delivery) Ted Sten, Foreperson 2011-2012 Santa Barbara County Grand Jury 1100 Anacapa Street Santa Barbara, CA 93101 Lloyd G. LeCain, Foreperson 2012-2013 Santa Barbara County Grand Jury 1100 Anacapa Street Santa Barbara, CA 93101 Lompoc City Council Teresa Gallavan, Economic Development Director and Assistant City Administrator Brad Wilkie, Management Services Director and Finance Director Linda Wertman, Redevelopment Coordinator Electronically to the Grand Jury via e-mail to sbcgj@sbcgj.org .' r;~ -_. :~~::~~5~~:O: -=-RE~EVELOP:::: COVENANTS I . . .--=~ T- - I - .~•. .... . O. ,cov!t t' t 'Extr VelY 8LM~ect;' Mod Las! Annual Affordability" ---- on;. '. R I Category,_Loan# Borrower NameofProject Address Loan~mount·: Maturity , e~i;~c".LOw 40% Low 60% .~OO'<.1.;20Report,· R~portDue Compliance " .,.,..' ae Date ,," 30% 50% 1%' .%. Submitted Date' Status Payment 0 I----I--~If__--. _..' 13 .~. .; . . ". Status Portobello 'originally' CalHFA 1 1597021LHCDC purchased 14 1 units 3 ,bu - t - 3 + 05- + 309 _ N.K t_ 1156 ' , I 000 - (P - ai + d)11 - 1/14 - /00 + 1 - 111 ~ 4130 +-113 12/31/05 13/15/10 Noncompliant f--:l=t---~IY rehab'ed .---Lj~---I--J._..-:L'_ I i. PAID C~~~~.~l!!~~ICDC ISouthern Court 709-713N.E 132,825(Paid) 02/27/01 02~27/31 12 14/GI07 1 1 3/15 - /1 - 0 ---I N - on - c - om - p - lia - n - t l-PA-I-D.--- Sot-Aside 159182jLHCDC KStreetCottages KI120&1201/2 121,028(Paid) 111/29/99111/29/29 2 2 ~/o/OI 1:l1'16/10 INoncompliant PAID Set-Aside 59'184 LHCDC StreetCottages S,f\ 12,572(Paid) 11/29199 11/29/29 ~ I ~-. Set-Aside 59186 HFH Mitchell,E&N 518 W.Laurel 10,000 11/11/0211/11/47 1 1. _ 11,'11/011 1;'/:1'1100 Compliant Current ~t-Aside 59187 HFH Vanwagenen, J 520W.Laurel 10,000 '11/11/02 11111147 1 1 _ 4/~O/IIlI I~'/II/IH'omIp[IClllt _Current Set-Aside 59701 LHCDC ChestnutApts 4 O-1(405W. 22,000(Paid) 03/31/00 03/31/30 3 3 ~lI/l1f I/IN/ill NIIllI,l)llIpliont PAID _______ ,'_ Clesl nut CalHFA 1 IS97051l.HCDC T&College(Bridge Loan)1521-537N.T 1227,000(paid) 110105/01110105/31 35 35 11/1/111 \/1/1/111 1111111111111111111rJ1A1l111J CalHFA 1 59'106 Li-ICDC T&College 521-537N.T 297,825(Paid) '1Oi05/01 10/05/31 _.__ __ _ __ .__ 1-----1----,-1----1-. ~~.;16;~~~; gIHFA'1 59707 l.HCDC Jay Apartments 181,050(Paid) 03/14/02 03/14/32 26 26 . 111/111 illt III Ili'"'IIIIIIIII_111 IIAln C~'Ir:A 1"'597-;~~~DC Casa ConTres ~~!~t438 N.L 157,300(Paid) 06/16/03 06/16/58 '12 12FRr-'- 1/1/11 HilI/II! i1iilll"llll,IIJ'1111 I'All) -- - - Nole:2unitsacquired, - WIIIII'i\ 1 1J0704 LHCDe Rebuild4units+infant 328-330 N.K 75,000(Paid) 07131/0"107/31/31 4 4 i,lll,il !\IJfIIllI rJ\'I'.!!illl'II~1I1 PAil carecenter. 1,,1A~IIi!l 01(11)( l.ll~]riC=== Co~~. 733 N, E 40,OQQ3Pai~L~ 06/16/37 18 18 -_.- - WIIU I'//IWI 1/',11"11'11111111 IIAII) = (1t11111 ---- 1I,\I\_llill llll~IU /;111111111 Ct1SCSIerena '1005thSI. 42,000(Paid) 021'14/95102/14/50 48 24 24 ilv IlfHI 1111f1! Il.ul 1',111 i\~I1(\n,IJl ..~:.. :t.~ ---"-f----·· - ._.• '--"-''--.-----.. -...,----·--cc-,- --. -- T·----- , " ,. ,", ' . .1~$( ..tE)dr, :Veiy. L'" Med Mod Las! Annlli~l_ 1\fI00dabliity nG Ca·tegoJY Na~1eofProject "'UE!'ts ,Low 40%. ~ow..'. ·'8·'Oo~ 100 120 R01port Report Oue campnane], '::>' t ,:'»'{">:" '.' " nJ ." 30%' 50 d Yo.' '.. to % Submiited Dale Status raymen . . -t - ~ "h I @ ' lUS ~Sid~- ~9280 HFH - CollegeAvenue W140C~~1408 407,000 02/15/0602/'15/51 ,._- ---- ----L-- -- - - Construct Vac.ani l ---~-~,;-~- E I- ' ---c-"-~-· . ollege !.liTem IvaC6ni Set-Aside 59250 HFH f(Sireet 308 N, I( 1225,000 - 02/07/06 02/07/51 -- C0/1sJ1:ucf Ci~~~~._-:::i CalHFA 2 59752 l:I~_,I( Street 308 N.1<1135,000 02/07/0602107~1 _ __ _ _ __. .__ ._. ..__Cw·J!.'1.!..._ TStreet Condos CalHFA2 5975'i ILHCDC 500SIOpl\~'1.T 1105,000 03/05104103/09/49 1 (Proposed 5ForSale 5 3 Construct IVacEJIli NJA Current Ca!HF/\ 2 59754 LHCDC 500BlocllN.T '135,000 03/05/0403/09/49 units) --l--~ ~~!I::~?9753 ·~:if.QE:-:.......__ !I''''ca-sa-D::-e-:-1 =-De-s-ar-ro-lIo·=iillS,lS..__ 375,000 =19'1/30/0601/30/6'1] -9 ,- 9 }:=·-=1 r=+=1COI1~ruct Vacant· N/A----·r·--·~~~e.61_= I se~~~~~d1e59282 Crown L.aur~~rown I.aurelLL~J~~~rel ~"~_ 28~~ J~/23/07 ~:~ 0 -.--!.----l-- --t~-~~-- Construct N/A --~- ~ N - JA --~ .. _-_- .. - C _ u . r _ re - n _ t .._-- Set-Aside 159241 15'13North G I*Homebase on G CalHFA 1 59709 513North G *rlomebase onG IcI) .r3o II) ~ I - 2 'w : o Oc :J J .3 I c 1 I 0 : ) I : - : - : c r c 5 - : g o : l I .- " c 5 O ~ 0 (i l : i J ~ I " : o U Oc : : s : i J - . . ~ 'w : l l ? : 'a J8 i = d E E - 2 L C oa ~ - : n t - s I l . 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