Title:
Title
(Housing Authority) Approval of Homekey Program Application - La Mancha Project
End
FileID
File ID: 2020-01021
Location
Location: 7789 LaMancha Way/Council District 8
End
Recommendation:
Recommendation
Adopt a Housing Authority Resolution authorizing the Executive Director, or Executive Director’s designee, to: 1) submit an co-application, along with Mercy Housing California, to the California Department of Housing and Community Development in the amount of up to $15,500,000 for funding under the Homekey Program; 2) execute a Standard Agreement for such funding and execute any documents necessary to participate in the Homekey Program, and any amendments thereto; and 3) amend the Housing Authority budget to receive and expend the $15,500,000 in Homekey Program funds for the acquisition, rehabilitation, and operation of a motel conversion to permanent supportive housing for the homeless.
FileName
Contact: Christine Weichert, Assistant Director, (916) 440-1353, Tyrone Roderick Williams, Deputy Executive Director, (916) 440-1316, Sacramento Housing and Redevelopment Agency
Body
Presenter: None
Attachments:
1-Description/Analysis
2-Resolution
Description/Analysis
Issue Detail: On July 16, 2020 the State of California Department of Housing and Community Development (HCD) announced that it is making $550 million available through a Notice of Funding Availability (NOFA) for the Homekey Program. The Homekey Program will provide funding to cities, counties, and other local entities to convert motels, hotels, and other non-residential structures into permanent supportive housing for the State’s unhoused population. The Homekey Program is funded with federal Coronavirus Relief Funds (CRF) which must be spent by December 30, 2020. In addition, the State is providing $50 million in General Funds to provide initial operating subsidies under the program which must be expended by June 30, 2022.
The Housing Authority is presented a co-application with Mercy Housing California that seeks funding to acquire a motel on La Mancha Way and undertake the moderate rehabilitation necessary for the motel rooms to serve as permanent housing for unhoused individuals and families. The Housing Authority will seek funding from the Homekey Program to cover the cost of acquisition, rehabilitation, and a portion of operation. The Housing Authority and the developer are partnering with the County of Sacramento for an allocation of Mental Health Services Act funding for additional operating funds. The Housing Authority will commit to covering the costs, as needed, for five years of operation as required by the Homekey program.
If the application is successful, Mercy Housing, as co-applicant, will acquire a 124-room extended stay hotel, located at 7789 La Mancha Way, currently operating as the Woodspring Suites. It is anticipated that 100 of the existing rooms in their current studio configuration will immediately be available for use as permanent supportive housing for eligible homeless and at-risk individuals. Due to the fact that the property was built in 2009, has been well-maintained, and has a kitchenette in each unit, the property offers a unique opportunity to occupy as permanent housing almost immediately upon acquisition. The remaining 24 rooms will be used to provide space for resident services. The Housing Authority will return with a detailed project description and requesting additional approvals in the event that a Homekey Program award is made.
Mercy Housing is a nonprofit public benefit corporation dedicated to providing quality affordable housing with supportive programs to low-income individuals in California. Mercy has developed more than 11,000 affordable homes, including over 8,000 rental and 3,000 homeownership units. Their portfolio includes 20 properties with over 1,400 units in Sacramento County. The Developer is qualified to repurpose a motel given its experience in the rehabilitation of the Budget Inn on Stockton Boulevard into the 74-unit Boulevard Court Apartments, and the 92-unit Courtyard Inn Apartments, both permanent supportive housing developments.
Policy Considerations: The Policy is consistent with the Sacramento COVID-19 Homeless Response Plan and will assist the City in meeting the 2013-2021 Housing Element goal of promoting the construction of extremely low income housing.
Economic Impacts: Not applicable.
Environmental Considerations:
California Environmental Quality Act (CEQA): Submission of the Homekey application is not a project subject to CEQA pursuant to CEQA Guidelines Section 15378. Any project undertaken with Homekey funds will be subject to subsequent CEQA analysis prior to approving the project, and is anticipated to be exempt pursuant to AB83.
Sustainability: Not applicable.
Commission/Committee Action: Sacramento Housing and Redevelopment Commission: The Sacramento Housing and Redevelopment Commission reviewed this item at their September 2, 2020 meeting. The votes were as follows:
AYES: Alcalay, Morgan, Nunley, Osmany, Staajabu, Woo
NOES: None
ABSENT: Griffin
ABSTAIN: None
Not present to vote: Boyd, Starks
Rationale for Recommendation: The number of people living unsheltered in Sacramento has increased significantly since the previous Point in Time Count.
Financial Considerations: The Homekey Program will provide the City with much-needed resources to provide housing for currently unhoused or unsheltered individuals and families. The proposal seeks approval to apply for up to $15,500,000 in funding for acquisition, rehabilitation and operation of a converted motel.
Local Business Enterprise (LBE) - M/WBE and Section 3 requirements: Not applicable.