Title
Adoption of Resolution Providing Written Confirmation of Previous City Council Authorization of a Portion of the City Base Allocation and Required Match Amount for Site A Eden Affordable Senior Project for Application to County Rental Housing Development Fund; and
Adoption of Resolution Providing Written Confirmation of Previous City Council Authorization of a Portion of the City Base Allocation and Required Match Amount for Site A Eden Affordable Family Project for Application to County Rental Housing Development Fund. (Base Reuse 819099)
Body
To: Honorable Mayor and Members of the City Council
From: Jill Keimach, City Manager
Re: Adoption of Resolution Providing Written Confirmation of Previous City Council Authorization of a Portion of the City Base Allocation and Required Match Amount for Site A Eden Affordable Senior Project for Application to County Rental Housing Development Fund; and Adoption of Resolution Providing Written Confirmation of Previous City Council Authorization of a Portion of the City Base Allocation and Required Match Amount for Site A Eden Affordable Family Project for Application to County Rental Housing Development Fund
BACKGROUND
In June 2015, the City Council approved the Site A Development Plan and a Disposition and Development Agreement (DDA) with Alameda Point Partners (APP), for a 68-acre area within Alameda Point. Site A includes 800 housing units, two hundred (200) of which are required to be affordable. Eden Housing, a highly qualified nonprofit affordable housing developer, will construct, consistent with the DDA, one hundred thirty (130) affordable housing units in two buildings for low- and very low-income households, which include: 1) a family building with 70 units (Family Project), and 2) a senior building with 60 units (Senior Project) (collectively, Affordable Housing Projects). The DDA provides for a donation of land by the City for the Affordable Housing Projects and a developer contribution of $3 million as part of the financing for the projects. APP and Eden Housing have agreed that the Affordable Housing Projects will be located on Block 8 within Site A.
In March 2016, APP assigned the Affordable Housing Implementation Plan contained in the DDA to Eden Housing, thereby officially designating Eden Housing as the Qualified Affordable Housing Developer for Site A.
On November 8, 2016, Alameda County voters passed the Countywide Housing Bond (Measure A1). The $580 million bond program will fund three homeownership programs and two rental housing development programs. Of the total Housing Bond, $425 million is allocated to the Rental Housing Development Fund to assist in the creation and preservation of affordable rental housing for vulnerable populations. Of the total amount allocated to the Rental Housing Development fund, $225 million is allocated as “Base City Allocation” funding to Alameda County jurisdictions based on a geographical allocation formula. The City of Alameda’s Base Allocation is $10.4 million.
On March 7, 2017 by motion, the City Council approved a Pre-Commitment of six million dollars of its Base Allocation. Of these Council committed Measure A1 Housing Bond funds, $1 million was to close the funding gap for Eagle Avenue due to reduced tax credit funding (not subject to this agenda item) and the remaining five million dollars was committed to close an anticipated funding gap for the two Site A Affordable Housing Projects.
On October 17, 2017 the City Council approved a Ground Lease with Eden Housing to demonstrate to funding sources and investors that Eden Housing has direct site control and the ability to implement the project with a contingency plan for construction of backbone infrastructure should Site A not close by April 9, 2018.
DISCUSSION
On November 7th, Alameda County Board of Supervisors adopted the final Measure A1 Development Policies for both the homeownership and rental programs, which included an application process for cities to allocate funds from the Base City Allocation to ensure the proposed projects meet programmatic and policy requirements of the Rental Housing Development Fund and Measure A1. Alameda County Housing and Community Development (HCD) released the application for the Base City Allocation on November 13, 2017 with a deadline of November 29, 2017. The policy requires all projects to demonstrate that matching funds and City Base Allocations have been authorized by the approving body for each project. Staff submitted a letter with the application informing HCD that staff would seek written confirmation in the form of two separate resolutions of the City’s previous approvals of match and Base Allocations.
As described above, the local match and City Base Allocation for Site A Affordable Housing projects have been previously authorized by City Council in the approval of the DDA in June 2015 and the Pre-Commitment approval in March 2017. Below are the City match and the Base Allocation amounts for each Eden project:
Site A/ Eden Affordable Housing - Family Project
Source of Funds |
Amount* |
Status |
Land Donation |
$5.1 million* |
Committed |
County of Alameda Measure A1 |
$2.0 million |
City Committed/County Approval Pending |
Bank Loan |
$4.2 million |
Committed |
VASH Voucher Loan |
$3.0 million |
Committed |
AHSC State Grant |
$9.0 million |
Apply Fall 2017 |
LIHTC 4% Investor Capital |
$14.5 million |
Apply June 2018 |
Section 811 Loan |
$3.1 million |
Pending Final Approval |
HCD Infill Infrastructure Grant |
$3.0 million |
Apply Fall 2017 |
GP Equity |
$3.4 million |
Committed |
TOTAL SOURCES |
$47.3 million |
|
*Based on most recent estimates
Site A/Eden Affordable Housing - Senior Project
Source of Funds |
Amount |
Status |
Land Donation |
$4.4 million* |
Committed |
County of Alameda Measure A1 |
$3.0 million |
City Committed/County Approval Pending |
Bank Loan |
$1.8 million |
Committed |
VASH Voucher Loan |
$5.0 million |
Committed |
Affordable Housing Program (AHP) |
$0.6 million |
Committed |
Master Developer Contribution |
$3.0 million |
Committed if APP Closes |
Veteran Housing Homelessness Program Loan |
$1.4 million |
Committed |
LIHTC 9% Investor Capital |
$16.1 million |
Apply March 2018 |
HCD Infill Infrastructure Grant |
$1.3 million |
Apply Fall 2017 |
TOTAL SOURCES |
$37.2 million |
|
*Based on most recent estimates
Funding from the Measure A1 bond is a critical piece of the funding puzzle that includes multiple sources of funding, most of which are already committed. The commitment of these funds is a tremendous benefit to proving the readiness and viability of the project for the remaining funding sources that will applied for this year. The City’s land contribution and base allocation make up approximately 15% and 20% of the total project budgets for the Family and Senior projects respectively based on most recent estimates.
Staff recommends adoption of two resolutions, one for each affordable housing project in compliance with the HCD Rental Housing Development application policies.
FINANCIAL IMPACT
There is no impact to the City’s General Fund from allocating five million dollars from the City’s base allocation of County affordable housing bond funds. The bonds are general obligation bonds issued by the Alameda County that are repaid by property owners throughout the County as part of their property tax bill. The City’s matching funds and portion of its base allocation are a critical part of the financing for these two projects contributing an estimated 17% of the total $84.5 million total project cost, without which the project may not be able to be built.
MUNICIPAL CODE/POLICY DOCUMENT CROSS REFERENCE
These affordable housing projects are anticipated to be built pursuant to a number of City documents including the Five-year Affordable Housing Pipeline, the Housing Element of the General Plan and the Site A DDA.
ENVIRONMENTAL REVIEW
On February 4, 2014, the City of Alameda certified the Alameda Point Final EIR in compliance with the California Environmental Quality Act (CEQA). The Final EIR evaluated the environmental impacts of redevelopment and reuse of the lands at Alameda Point consistent with the Town Center Plan, which included Block 8 within Site A. No further environmental review is required under CEQA Guidelines sections 15162 and 15163.
RECOMMENDATION
1) Adopt a resolution providing written confirmation of previous City Council authorization of a portion of the City Base Allocation and required match amount for Site A Eden Affordable Senior Project for application to county rental housing development fund; and 2) adopt a resolution providing written confirmation of previous City Council authorization of a portion of the City Base Allocation and required match amount for Site A Eden Affordable Family Project for application to county rental housing development fund.
Respectfully submitted,
Jennifer Ott, Base Reuse and Transportation Planning Director
By,
Michelle Giles, Redevelopment Project Manager
Financial Impact section reviewed,
Edwin Gato, Acting Finance Director