Title
Adoption of Resolution Authorizing the City Manager, or Designee, to Enter into and Execute a Standard Agreement for Stardust Gardens to Secure $15,000,000 in Multifamily Housing Program (MHP) Gap Funding and All Amendments Thereto (Collectively, the “Program Award Documents”).
In accordance with the California Environmental Quality Act (CEQA), this action is categorically exempt from further environmental review pursuant to CEQA Guidelines Sections 15268 (Ministerial Action) and 15061(b)(3) (Common Sense Exemption). (Base Reuse and Economic Development 29061822)
Body
To: Honorable Mayor and Members of the City Council
From: Gerry Beaudin, City Manager
EXECUTIVE SUMMARY
On August 11, 2026, the City of Alameda (City) and MidPen Housing Corporation (MidPen) (collectively, the “Awardees”) received a Conditional Award Commitment from the California Department of Housing and Community Development (HCD) for $15,000,000 in Multifamily Housing Program (MHP) gap funding through Round 4 of HCD’s Multifamily Finance Super NOFA (MFSN), Contract No. 26-MFSN-19038. Despite this project previously receiving a $44,550,361 conditional award of Affordable Housing and Sustainable Communities (AHSC) Program funds, which are administered by the Strategic Growth Council (SGC) and implemented by the HCD, in December 2025, the project still requires additional gap financing. This MHP award will help close the remaining funding gap for the construction of Stardust Gardens, the 80-unit first phase of the 332-unit Rebuilding Existing Supportive Housing at Alameda Point (RESHAP) project.
To accept the MHP award and remain eligible for disbursement, HCD requires the Awardee to timely satisfy several Terms and Conditions of the Conditional Award, including adopting an authorizing resolution within sixty (60) calendar days of the date of the Conditional Award Commitment, or by October 10, 2026. The included resolution, if adopted, would satisfy this requirement.
Consistent with past practice on the related AHSC resolution, staff has used HCD’s template Authorizing Resolution for public entities, with minimal modifications, to support timely HCD review and approval of the Program Award Documents.
BACKGROUND
MHP is one of several HCD programs consolidated under the Multifamily Finance Super NOFA (MFSN), authorized by Assembly Bill 434 (Chapter 192, Statutes of 2020). MHP provides gap financing to develop affordable multifamily rental housing. MHP is funded through state housing bond proceeds and, like most HCD bond-funded programs, is structured as a deferred-payment loan rather than a grant. Loan-based gap financing of this kind is a standard and widely used tool in affordable housing development, allowing HCD to eventually recycle repaid funds into future affordable housing awards.
On May 20, 2025, staff provided an update to City Council on the City’s joint application with MidPen for Round 9 of the AHSC funding program. On May 28, 2025, the City and MidPen submitted a joint AHSC application, and on December 10, 2025, the SGC awarded the City and MidPen $44,550,361 in AHSC grant and loan funding for Stardust Gardens and related transit, bicycle, and pedestrian improvements.
On January 20, 2026, City Council adopted a resolution authorizing the execution of the AHSC Program Award Documents.
On April 20, 2026, HCD issued the Multifamily Finance Super NOFA - MHP Gap Funding NOFA, Round 4. On June 5, 2026, the City and MidPen submitted their joint MHP application to HCD. On August 11, 2026, HCD issued a Conditional Award Commitment to MidPen and the City for $15,000,000 in MHP funds to help close the remaining construction financing gap for Stardust Gardens. On August 20, 2026, the Awardees executed and delivered the Acceptance of Terms and Conditions of Conditional Award form to HCD.
DISCUSSION
The purpose of this agenda item is to request City Council adoption of a resolution authorizing the City Manager, or designee, to enter into and execute a Standard Agreement to secure $15,000,000 in MHP program funds and all amendments thereto (collectively, the “Program Award Documents”).
The MHP award will provide additional gap financing needed to construct Stardust Gardens, the 80-unit permanent supportive housing project to be developed and managed by MidPen, with services provided by Alameda Point Collaborative, complementing the $44,550,361 in AHSC funds previously awarded to the Project.
As with the AHSC award, MidPen is the developer, co-owner, along with Alameda Point Collaborative (APC), and operator of Stardust Gardens, while the City is a co-applicant/co-Awardee alongside MidPen. This joint structure is typical for HCD multifamily awards involving publicly owned or publicly supported sites, such as Stardust Gardens at Alameda Point. In practice, the City's role is limited to co-signing the Program Award Documents as a co-Awardee; MidPen is solely responsible for financing, constructing, and operating Stardust Gardens, and for repaying the MHP loan.
Key terms and conditions of the MHP Conditional Award include the following:
● Authorization and Organizational Documents: The Awardee(s) must deliver an authorizing resolution (and, for MidPen, its organizational documents) within sixty (60) calendar days of the Conditional Award Commitment (by October 10, 2026).
● Tax Credit Financing Structure: As a condition of the MHP award, the funds cannot be paired with State Low-Income Housing Tax Credits or nine percent (9%) Federal Low-Income Housing Tax Credits. In accepting the MHP award, MidPen is therefore committing to apply for four percent (4%) federal tax credits and tax-exempt bond financing through the 2026 CDLAC/CTCAC cycle (with no state credit request), and to meet the applicable CDLAC deadline in September 2026. MidPen submitted its four percent (4%) tax credit application on September 4, 2026, following action by the City Council on September 1 to execute a commitment letter for necessary operating subsidy, contingent on another subsidy not being secured.
● Standard Agreement: HCD commits to delivering an executed Standard Agreement (STD 213) within ninety (90) calendar days of receiving all required documents.
● Permanent Financing Deadline: All permanent financing, including tax credits and bond allocations, must be secured within twenty-four (24) months of the date of the first HCD funding award to the Project. Because Stardust Gardens previously received AHSC funding in December 2025, all permanent financing must be secured by December 2027. If this deadline is not met, HCD's Disencumbrance Policy could result in withdrawal or recapture of the MHP award and any other HCD funds awarded to the Project.
As with the companion AHSC resolution, HCD has provided a resolution template for public entities and has advised that its use may assist in the timely review and approval of the Program Award Documents. The included resolution, therefore, differs from the City’s standard resolution format, and staff have elected to make only minimal modifications to the HCD template to ensure acceptance by HCD.
ALTERNATIVES
City Council may consider the following alternatives to the staff recommendation, as well as other alternatives not identified below:
● Do not authorize the Program Award Documents and direct staff to pursue a different approach. In this case, HCD may rescind the Conditional Award, making it more difficult to close the remaining funding gap for Stardust Gardens and jeopardizing the tax credit application and AHSC award.
FINANCIAL IMPACT
The Conditional Award provides $15,000,000 in MHP loan funds to help finance the development of Stardust Gardens. Unlike the AHSC award, the MHP award is structured as a deferred-payment, low-interest loan rather than a grant. No local match is required for this award.
MidPen, as the Project developer, co-owner (along with APC) and the operator, is the borrower and primary repayment obligor under the MHP loan. The City’s role is as co-applicant/co-Awardee. As such, staff does not anticipate a direct impact on the General Fund or other City budgets from loan repayment.
MUNICIPAL CODE/POLICY DOCUMENT CROSS REFERENCE
The acceptance of these grant funds and related commitments is in alignment with the City's Housing Element 2023-2031, Climate Action and Resiliency Plan (CARP), Active Transportation Plan's 2030 Infrastructure Plan, Alameda Point Transportation Demand Management Plan, Green Infrastructure Plan, Vision Zero Action Plan, Transportation Choices Plan (TCP), Economic Development Strategic Plan (2018), and Strategic Plan Goal HH6 - Support Implementation of RESHAP and West Midway Housing Developments at Alameda Point. This action is subject to the Levine Act.
ENVIRONMENTAL REVIEW
In accordance with the California Environmental Quality Act (CEQA), this action is categorically exempt from further environmental review pursuant to CEQA Guidelines Sections 15268 (Ministerial Action) and 15061(b)(3) (Common Sense Exemption).
Successful completion of the Stardust Gardens project will continue to support the City’s affordable housing and climate resiliency goals.
RECOMMENDATION
Adopt a resolution authorizing the City Manager, or designee, to enter into and execute a Standard Agreement to secure $15,000,000 in Multifamily Housing Program (MHP) funds and all amendments thereto (collectively, the “Program Award Documents”).
Respectfully submitted,
Abigail Thorne-Lyman, Base Reuse and Economic Development Director
By,
Walker Toma, Community Development Manager
Financial Impact section reviewed,
Ross McCarthy, Finance Director