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AUTHORIZE TRANSIT-ORIENTED DEVELOPMENT HOUSING PROGRAM APPLICATION WITH VISIONARY HOME BUILDERS OF CALIFORNIA, INC. FOR LA PASSEGGIATA APARTMENT PROJECT
recommended action
RECOMMENDATION
It is recommended that the City Council adopt a resolution to:
1. Approve the Notice of Exemption No. NOE35-20 under the California Environmental Quality Act for the La Passeggiata Apartment project.
2. Authorize the City Manager to submit a joint application with Visionary Home Builders of California, Inc. to the State of California Department of Housing and Community Development for funding under the Transit-Oriented Development Housing Program for the La Passeggiata Apartment project.
It is also recommended that the City Manager be authorized to take appropriate and necessary actions to carry out the purpose and intent of this resolution.
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Summary
On April 30, 2020, the State of California Department of Housing and Community Development (HCD) issued a Notice of Funding Availability for approximately $141 million in funds for the Transit-Oriented Development (TOD) Housing Program, funded by the Veterans and Affordable Housing Bond Act of 2018. Visionary Home Builders of California, Inc. (Visionary) will be developing the State surplus land located at 601, 611, and 622 East Lindsay Street (Attachment A). The development is entitled “La Passeggiata” which is a 94-unit multi-family and senior housing development that targets household incomes at or below 60 percent of the area median income. Visionary will take the lead in preparing a TOD Housing Program funding application with support of City staff.
The TOD Housing Program funding application will include remediation work needed on the development site in the amount of $2 million, plus $2.7 million for sidewalk, bicycle, and curb ramp accessibility improvements at various intersections. The total TOD Housing Program funding application amount will be approximately $4.7 million. Staff recommends Council adopt a resolution approving the Notice of Exemption No. NOE35-20 under the California Environmental Quality Act (CEQA) and authorizing staff to submit a TOD Housing Program funding application in the amount of $4.7 million to the HCD for La Passeggiata, an affordable housing development project.
DISCUSSION
Background
On April 30, 2020, the HCD issued a Notice of Funding Availability for approximately $141 million in funds for the TOD Housing Program, funded by the Veterans and Affordable Housing Bond Act of 2018. The maximum award per project is $15 million and can be a combination of a maximum of $10 million in loans and $5 million in grants, respectively. Low-interest loans are available as gap financing for eligible sponsors for housing developments. Grants are available for infrastructure improvements necessary for the development of specified housing developments, or to facilitate connections between these developments and the transit stations. The primary objectives of the TOD Housing Program include increasing the overall supply of housing and affordable housing, increasing public transit ridership, and minimizing automobile trips. Funding applications for the TOD Housing Program are due July 30, 2020.
In February 2020, Visionary was selected as the preferred developer by the HCD for an affordable housing project entitled “La Passeggiata”. The project will develop State surplus land located at 601, 611, and 622 East Lindsay Street and is estimated to cost approximately $36.5 million. La Passeggiata is a 94-unit multi-family and senior housing development that targets household incomes at or below 60 percent of the area median income. The project will be Stockton's first modular apartment complex utilizing innovative design features and technology in the heart of downtown.
The La Passeggiatta project is a competitive candidate for funding under the TOD Housing Program. As such, City staff and Visionary are presently working to complete the final cost and scope for a TOD Housing Program funding application for the La Passeggiata project.
Present Situation
Visionary will take the lead in preparing a TOD Housing Program funding application with support of City staff. The City will be required to submit the funding application as the sponsor and joint applicant with Visionary. A TOD Housing Program funding application will request funding from the maximum $5 million grant portion of program.
An environmental assessment of the State property detected lead and buried debris on the development site. This is an unexpected environmental remediation cost for the La Passeggiata project, and the State has encouraged Visionary to seek TOD Housing Program grant funding for this cost. The TOD Housing Program funding application will include remediation work needed on the development site in the amount of $2 million. The TOD Housing Program funding application will also include transportation related improvements that support pedestrian, bicycle, and public transit uses in the area. Specifically, staff has included $2.7 million in costs related to sidewalks along Miner Avenue, bicycle improvements along California Street, and ramps at various intersections to comply with the American with Disabilities Act.
The total value of the TOD Housing Program funding application to be submitted will be approximately $4.7 million as described above. A State of California Standard Agreement, Disbursement Agreement for funding reimbursements, and City/Visionary Indemnity Agreement will likely be required if the application is approved for funding. Approval of these documents will be presented to Council at a later date if project funding is awarded.
HCD requires an authorizing resolution for the City and Visionary as part of the application for TOD Housing Program funds. The resolution states the City’s desire to apply for funding and willingness to enter into required State agreements and other documents deemed necessary and required.
The project conforms with the City’s General Plan, pursuant to California Government Code section 65402, and is categorically exempt from the requirements of CEQA as specified under Section 15301(c) of the CEQA Guidelines. The activities related to this project constitute a discretionary project under the City’s jurisdiction and qualifies as a project that does not have a significant effect on the environment. The resolution will approve the filing of Notice of Exemption No. NOE35-20 under CEQA.
Staff recommends Council authorize staff to submit a TOD Housing Program funding application in the amount of $4.7 million to the HCD for La Passeggiata, an affordable housing development project.
FINANCIAL SUMMARY
If the City is awarded the TOD Housing Program funding in the amount of $4.7 million, Visionary and the City will work cooperatively to complete the elements of the grant. TOD Housing Program grant funds do not require matching funds from the City. There are no appropriations required by taking this action. If funds are awarded, Council will be asked to approve any agreements and appropriations at a future meeting.
There is no impact to the City’s General Fund or any other unrestricted fund as a result of taking the recommended action.
Attachment A - Vicinity Map