Title
Recommendation to Authorize the City Manager to Execute an Amendment to the Agreement with the Alameda Food Bank for Tenant Acquisition and Use of Community Development Block Grant (CDBG) Funding. (City Manager 20321844)
Body
To: Honorable Mayor and Members of the City Council
From: Jennifer Ott, City Manager
EXECUTIVE SUMMARY
On August 2, 2024, the Alameda Food Bank (Food Bank) purchased Building 607 and the associated 1.7 acres of land at 677 West Ranger Avenue from the City of Alameda (City) in the amount of $3.06 million to construct a permanent Community Market for food distribution to vulnerable households. Of the $3.06 million in acquisition and future construction costs, $100,000 was funded through the Community Development Block Grant (CDBG) specifically for tenant acquisition costs.
Staff recommends authorizing the City Manager to execute an Amendment to the Agreement with the Alameda Food Bank to support the acquisition of an existing property at 677 West Ranger Avenue. The Amendment is to authorize utilizing the funds for tenant acquisition rather than relocation and tenant improvement costs as defined in the original Agreement. The Amendment to the current Agreement will allow City staff to request reimbursement from the Federal Department of Housing and Urban Development (HUD) for an eligible activity.
BACKGROUND
In 2022 the Food Bank, a local nonprofit organization, approached the City to discuss its interest in purchasing land for the construction of a permanent, new facility. The Food Bank currently serves approximately eight percent (8%) of Alameda’s residents and approximately 700 families per week. It is open to the public on Monday, Wednesday, and Friday. It has a paid staff of four, supplemented by volunteers. The Food Bank currently provides services from approximately 18,000 square feet of leased space in Building 92, which is immediately across the street from the new, 1.7-acre site at Building 607, located at 677 West Ranger Avenue. The new, permanent facility will include a similar 18,000-square-foot Community Market, providing a grocery store experience for residents seeking food assistance and expanded food storage to prepare for emergencies affecting the larger community.
On November 13, 2023, the Planning Board held a public hearing at which they reviewed and unanimously approved the Food Bank’s proposed Development Plan and Use Permit for the new site. On March 19, 2024, City Council authorized the City Manager to execute a purchase and sale agreement for Building 607 with the Food Bank. On July 22, 2024, the Planning Board approved the Design Review permit for the new building and site improvements.
On August 2, 2024, the Food Bank purchased this site from the City for $3.06 million. The acquisition of the property, along with additional investments and construction costs to expand and refurbish Building 607 totaled $5 million.
DISCUSSION
Each year staff receives approval from City Council regarding recommendations for activities to be funded with the annual allocation of CDBG and HOME funds. On April 2, 2023, a public hearing was held to consider an amendment to the Fiscal Year (FY) 2020-21 through 2022-23 CDBG Action Plans and authorize the City Manager to negotiate and execute related documents. The Alameda Food Bank relocation was one of three projects that City staff proposed to fund as part of the recommendation to reprogram funding from FY 2020-21 through 2022-23. The scope of work and budget from the current agreement with Alameda Food Bank details use of CDBG funds to support relocation and tenant improvement costs. Although the intent was to support relocation and tenant improvement costs, the Alameda Food Bank utilized $100,000 in CDBG funding solely for tenant acquisition.
To ensure compliance with CDBG regulations around accurate reporting, staff recommends authorizing the City Manager to execute an Amendment to the Agreement with the Alameda Food Bank to clearly state the use of funds go toward the acquisition of an existing property at 677 West Ranger Avenue. The Amendment to the current Agreement will allow City staff to request reimbursement from HUD for an eligible activity. According to HUD, an "eligible activity" refers to a specific action or project that can be funded using HUD programs, for example acquiring real property, rehabilitating existing structures, constructing new housing, providing public services, offering homeownership assistance, or supporting economic development initiatives, all within the parameters of the HUD program guidelines.
ALTERNATIVES
• Approve the Amendment to the Alameda Food Bank Agreement to reflect necessary changes in project scope. The City will request and receive reimbursement from HUD.
• Not approve the Amendment to the Alameda Food Bank Agreement to reflect necessary changes in project scope. The City may then be required to cover these expenses with the General Fund.
FINANCIAL IMPACT
There is no impact on the General Fund. The funds available within the CDBG Action Plans are budgeted in the Housing and Human Services CDBG Fund (Fund 203).
MUNICIPAL CODE/POLICY DOCUMENT CROSS REFERENCE
Project HH5 in the Strategic Plan: Coordinate with the Alameda Food Bank on their relocation. This action is subject to the Levine Act.
ENVIRONMENTAL REVIEW
Under federal law, the execution of agreements and final funding commitments related to this action are subject to satisfactory environmental clearance pursuant to 24 CFR Part 58. Additionally, this action does not constitute a “project” as defined in California Environmental Quality Act (CEQA) Guidelines Section 15378 and therefore no further CEQA analysis is required.
CLIMATE IMPACT
There are no identifiable climate impacts or climate action opportunities from amending the current agreement with the Alameda Food Bank for acquisition.
RECOMMENDATION
Authorize the City Manager to execute an amendment to an agreement with the Alameda Food Bank for tenant acquisition and use of CDBG funding.
Respectfully submitted,
Amy Wooldridge, Assistant City Manager
By,
Andre Fairley, Management Analyst
C’Mone Falls, Housing and Human Services Manager
Financial Impact section reviewed,
Margaret O’Brien, Finance Director
Exhibits:
1. Amendment to Agreement
2. Original Service Provider Agreement