The Hollister Redevelopment Agency may be defunct, but that doesn’t mean its functions all went away with it.
City officials still have an affordable housing stock to consider and arrangements left over from the RDA.
This week, the RDA “successor agency” – the city – had to consider what to do with a home, at 971 Sherwood Drive, going into foreclosure. The owner had to notify the city because Hollister’s RDA in January 2004 had provided direct financial assistance – about $27,000 – and now the home is in foreclosure.
The state in 2011 dissolved the RDA program, but also allowed cities to continue on with successor agencies to handle remaining obligations. Planning head Bill Avera said in some cases, it is “business as usual” whether there is an RDA or successor agency.
“We have tons of arrangements out there or agreements with people,” Avera said.
With the Sherwood Drive home, the city is working with South County Housing to find a buyer – while one has been identified. But officials with the former RDA asked and received approval for $240,000 in housing funds from the council Monday in the event a new buyer fails to qualify within the 60-day escrow period. Avera said officials intend to maintain the home’s 30-year resale restriction by keeping it classified as affordable.
An appraiser recently valued the home at $215,000 – while the remaining $25,000 from the city would cover additional transaction fees. Council members unanimously approved the move, which uses money from a housing fund left from the RDA. Avera explained that Hollister has about $3 million left in that fund and said many cities don’t have the same luxury.
“We’re fortunate we have a pool of money we can use to do this,” he said.
Avera said that if one home such as 971 Sherwood Drive goes to market rate, then there is a perception among neighbors that others can do the same. Avera acknowledged one prior case involving a lawsuit in which an affordable homeowner resold at market rate.
As for the notion that most homes in Hollister are relatively affordable due to the deflated housing market, Avera stressed that the city takes a long-term perspective of values with such matters.
“Home prices are going up on a monthly basis right now,” he said. “Once we do this one, we’ll have another restricted unit for 45 years.”
Avera acknowledged there is a chance the city might lose some money, but contended it would be worth it, keeping the home as affordable.
In this video, former county GOP Chairman Marvin Jones questions the use of the funds:
