Sacramento Housing and Redevelopment Agency (SHRA) is meeting the permanent supportive housing goals of the Sacramento City and County 10 Year Plan to End Chronic Homelessness: 2006-2016 using redevelopment tax increment housing funds for rental assistance to support the Plan's two Housing First strategies during implementation: Units through Development and Units through Leasing. Typically, redevelopment agencies use tax increment funds to meet housing production goals both inside and outside redevelopment areas. Funds are generally used for gap financing for development costs.

California passed the first tax increment financing law in the nation in 1952, and there are tax increment financing laws in 48 states and the District of Columbia, offering an effective means and broad discretion for local governments to finance capital projects in support of economic development goals. The approach is considered a "self-financing" means to pay for economic development projects. Government officials do not have to impose new taxes or raise rates, but instead reallocate new revenues from development.

While the use of tax increment housing funds for rental assistance is allowed under California redevelopment law, it is not common. Prior to adoption of its 10 Year Plan, Sacramento had principally used these funds to support acquisition/rehabilitation or new construction of housing intended to meet affordability needs. Providing rental assistance to tenants is a new approach that allows developers to serve extremely low-income or no-income tenants who are moving from the streets into permanent housing.

People who are homeless and chronically homeless benefit from the two Housing First strategies forwarded in Sacramento's 10 Year Plan. Use of redevelopment tax increment funds has enabled Sacramento to meet its critical housing goals during the first year of implementation of the 10 Year Plan.

The City and County of Sacramento, in both public and private sectors throughout the community, benefit from a revenue stream that supports 10 Year Plan housing goals, which, in turn, will accrue cost savings to the community in basic infrastructure systems of health care and law enforcement and more, as more individuals are placed in housing and cease to ricochet randomly through expensive systems.

Sacramento City and County have recently reported results in their 10 Year Plan, using a public and quantified "report card' documenting progress toward goals and benchmarks. The report card was featured as Innovation #2 during the 20 in 20 e- news series in May. Sacramento Mayor Heather Fargo, Sacramento County Supervisor Roger Dickinson, Bruce Wagstaff, Director of the Sacramento County Department of Human Assistance, and former Plan point person Diane Luther prepared and released a report card on progress, "The First Year: 2007 Progress Report For Sacramento's Ten Year Plan To End Chronic Homelessness."

Quantifiable outcomes reported in the scorecard demonstrate that results are being measured, including:

• Goal: The Plan's 3-year housing goal was the creation of 218 new rental opportunities for persons who are chronically homeless.
• Result: 171 persons housed in year 1 and funding for an additional 140 rental units planned for 2008 - 2009.
• Goal: The Plan called for preventing homelessness through housing preservation and development, with a goal to create 200 new SRO units and preserve 100 SROs for extremely low income people with disabilities.
• Results: The 100-unit downtown Berry Hotel has been purchased by a developer who is assembling financing to rehabilitate and preserve the building as very low income housing. Two more projects are in the pipeline to preserve or replace SRO resources.

Units Under Development Model. To meet the 10 Year Plan's housing goal, SHRA has partnered with Mercy Housing California to develop 139 supportive housing units in three developments that are currently under construction. Tax increment funds along with other SHRA financing and tax credits will provide long term affordable housing to people who are chronically homeless with mental illness, substance abuse issues, co-occurring disorders, and HIV/AIDS.

The housing tax increment funds have been used both to fund development costs and provide rental assistance to formerly homeless tenants. All units will be complete and leased up by November 2008. SHRA also has 162 units for people who are chronically homeless in the financing pipeline and expected to be on line in 2009 and early 2010. In addition, SHRA is undertaking development of a 160- unit efficiency apartment project that is in the planning stages. At this rate, development of SHRA assisted units is exceeding proposed goals.

Units through Leasing Model. One housing provider in the leasing model focuses on the homeless mentally ill population, and the other focuses on the non-disabled homeless population. Homeless persons are placed directly from the street, shelters, or treatment facilities and pay 30 percent of income toward the cost of their housing, including utilities. Those without a source of income are housed and are assisted in applying for benefits.

Under the Units through Leasing Model, the agencies receiving the SHRA resources rent homes with four to six bedrooms and sublet each bedroom to a person who is homeless. Each house has a monitor who is typically a formerly homeless person who has experience with the program. The housing provider works with a social services provider for case management support.

SHRA contracts with the Sacramento County Division of Mental Health to support people who are homeless and mentally ill. The County DMH then subcontracts housing dollars to a housing and supportive service provider. The supportive services for the units described here are funded through California's innovative Mental Health Services Act, a voter- approved initiative that taxes incomes over $1 million to provide a source of funds to provide housing and services to the homeless mentally ill population.

SHRA contracts with Sacramento Self Help Housing, a local nonprofit homeless provider who does direct placements from street to housing. Houses and apartment units are leased on the open rental market. Self Help Housing does street outreach or receives referrals from other outreach organizations and places persons based on need and compatibility with other residents in the homes. Typically four to five persons share a four-bedroom house and pay 30 percent of their income toward the housing costs, including utilities. House rules that emphasize mutual respect, care of the housing, and being a good neighbor are enforced in the units to ensure safety and security for residents. A formerly homeless person acts as a house monitor in units having multiple residents. SHRA expects that up to 90 persons annually will be assisted under this program. Supportive services in these units are provided by Lutheran Social Services, which is receiving McKinney-Vento funds to provide services.

Sacramento Mayor Heather Fargo, Sacramento County Supervisor Roger Dickinson, Bruce Wagstaff, Director of the Sacramento County Department of Human Assistance, Tim Brown, Sacramento Chronic Homelessness Initiative Director, and SHRA leadership by the Housing and Redevelopment Commissioners, along with an array of community partners, all create the results being reported.

Sacramento Housing and Redevelopment Agency (SHRA) is a Joint Powers Authority created by the City and County of Sacramento to represent housing and community redevelopment needs of both jurisdictions. The Agency serves as the Housing Authority for the City and County of Sacramento and is the leading public developer of housing targeted to affordability issues and oversees residential and commercial revitalization activities in 14 redevelopment areas throughout the City and County.

As a redevelopment agency, SHRA administers tax increment funds generated in its redevelopment areas. By state law, 20% of tax increment must be used for housing deemed affordable. As the lead partner for financing homeless housing in Sacramento's 10 Year Plan, SHRA is using tax increment and other financial resources to meet the housing goals set in the Ten Year Plan.

Read "The First Year: 2007 Progress Report For Sacramento's Ten Year Plan To End Chronic Homelessness:" http://www.communitycouncil.org/homelessplan

Learn more about Sacramento's Ending Chronic Homelessness Initiative: contact: Tim Brown, Chronic Homelessness Initiative Director at: 916-447-7063.

Learn more about SHRA.

5 in 5, A Week of Innovations, continues tomorrow with a Special Issue focused on . . . Seattle's Housing Levy: Moving from Managing Homelessness to Ending Homelessness . . .

Don't miss a single episode during this 5 in 5 Week of Innovations . . . but, if you do, you can always access the Council's "on demand" service and catch up. Just visit our web site at www.usich.gov/innovations

Does your state, city, or county target real estate transfer taxes, interest from escrow accounts, bond and fee revenues, document recording fees, real estate excise tax, condominium conversion fees, contributions from tax-exempt mortgage revenue bond projects, hotel/motel taxes, filing fees, property sales disclosure forms, building permit fees, real estate transfer taxes, impact fee on new commercial construction, tax increment revenues, parking garage proceeds, restaurant tax, inclusionary zoning in-lieu fees, property tax, sales tax, court settlements, or casino revenues specifically to the goals of your 10 Year Plan? Write to use at the Council's Innovations "Inn-box" - 20in20@usich.gov and give us more details.

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