Title
Summary Title: Approval of Development Agreements with MidPen Housing and the Collaborating Partners for the RESHAP Project Consisting of 309 Permanent Supportive Housing Units on a New 8-Acre Campus at Alameda Point, Including Declaring the Property Exempt Surplus Land
Public Hearing to Consider Adoption of Resolution Declaring the Rebuilding Existing Supportive Housing at Alameda Point (RESHAP) Property and the Adjacent West Midway Property Located at the Corner of West Midway Avenue and Pan Am Way at Alameda Point to Be Exempt Surplus Land under the Surplus Land Act;
Introduction of Ordinance Authorizing the City Manager to Execute a Disposition and Development Agreement (DDA) between the City of Alameda and the Collaborating Partners and MidPen Housing Corporation for the Development of the RESHAP Property in Substantial Conformance with Exhibit 2; and
Introduction of Ordinance Authorizing the City Manager to Execute a Development Agreement (DA) between the City of Alameda and the Collaborating Partners and MidPen Housing Corporation for the Development of the RESHAP Property in Substantial Conformance with Exhibit 3. Pursuant to Public Resources Sections 21166 and 21083.3 and Sections 15162 and 15183 of the CEQA Guidelines, no further environmental review is required. (Base Reuse 29061810)
Body
To: Honorable Mayor and Members of the City Council
From: Jennifer Ott, City Manager
EXECUTIVE SUMMARY
The Rebuilding Existing Supportive Housing at Alameda Point project (RESHAP) is a plan to construct and manage permanent supportive housing on a new 8-acre campus at the corner of West Midway Avenue and Pan Am Way by MidPen Housing Corporation, the Alameda Point Collaborative, Operation Dignity, and Building Futures With Women and Children (the “Collaborating Partners”) for extremely low, very low, and low income households.
The RESHAP project exemplifies the City of Alameda’s (City) continuing commitment to addressing the regional affordable housing crisis and to providing for the housing needs of Alameda’s most vulnerable residents. The RESHAP project is critical to the successful implementation of the City’s Housing Element 2023-2031 and General Plan policy objectives for the redevelopment and reuse of the former Naval Air Station lands at Alameda Point.
The recommended resolutions and ordinances make it possible for the City, the Collaborating Partners and their development partner, MidPen Housing (MidPen), to construct a campus comprised of supportive housing for Alameda’s most vulnerable households and on-site service managers, on-site services, commercial and community space, and public outdoor gathering spaces, including a farm/garden and a large barn that will function as a community facility and offer services for residents and the community.
The RESHAP Development Plan and Development Agreement (DA) were unanimously approved by the Planning Board on May 8, 2023. Staff is now recommending that City Council hold a public hearing and take the necessary actions to facilitate the construction of the RESHAP project. The recommended actions, include:
• Approving a resolution declaring the 8-acre RESHAP property at Alameda Point to be “exempt surplus land” under the Surplus Lands Act;
• Approving a first reading of an ordinance authorizing the City Manager to execute the Disposition and Development Agreement (DDA) for the project; and
• Approving a first reading of an ordinance authorizing the City Manager to execute the DA for the project.
BACKGROUND
The Collaborating Partners provide a unique and critical service for individuals, families, and veterans struggling with homelessness, poverty, mental health, and domestic violence in 70-year-old, leased, former Navy buildings. Alameda Point Collaborative (APC) provides housing and services for formerly homeless families. APC’s services include job training and job opportunities through environmentally sustainable social enterprise businesses and instructional programs about health, nutrition, and horticulture through Ploughshares Nursery and the APC farm. APC also operates after school academic and life skills programs for children and youth. Building Futures with Women and Children (BFWC) provides housing and services for women and children escaping family violence and homelessness. Operation Dignity provides homeless veterans and their families emergency, transitional, and permanent housing and comprehensive support services, nutritious meals and training needed to live a self-sufficient and stable life.
In 2015, the Collaborating Partners and their selected development partner, MidPen, a Bay Area-based nonprofit affordable housing developer, held a series of intensive community outreach meetings, focus groups and design input meetings with residents on their preferred housing types and ideas for the neighborhood design.
In 2017, City Council approved the Main Street Neighborhood Specific Plan which establishes the City’s specific development policies and standards for development of the area bounded by West Tower Avenue, Pan Am Way, and Main Street (the “Main Street Neighborhood”). The RESHAP project is identified as one of the two primary objectives of the Specific Plan.
In 2018, City Council approved the Development Plan and DA and DDA for the RESHAP Project for a 9-acre site at the corner of West Midway and Main Street. The development proposed in the 2018 DDA contemplated that the infrastructure for the RESHAP Project would be constructed by the market rate developer of the adjacent properties and that the City would issue an RFP for that developer.
In 2020, the City issued a “West Midway Project” Request for Proposals (RFP) and selected the development team of Catellus Development and Brookfield Homes for the development of 26 acres of residentially zoned land immediately adjacent to the RESHAP project within the Main Street Neighborhood Specific Plan area. The West Midway Project RFP and the subsequent Exclusive Negotiating Agreement (ENA) requires that the West Midway residential development fund the necessary infrastructure improvements and site preparation costs for the adjacent RESHAP property.
In 2021, after joint site planning and consideration, City staff, MidPen, the Collaborating Partners, Catellus, and Brookfield made the determination that relocating the RESHAP campus from Main Street at the periphery of Alameda Point to Pan Am Way near the center of Alameda Point resulted in a better, more integrated site plan for Alameda Point and for RESHAP.
In 2022, the Planning Board held public workshops to review the initial site plans for the West Midway project and the new location of the RESHAP campus, and City Council unanimously approved staff’s recommendation to approve the proposed draft Term Sheet and new location for the RESHAP project with Brookfield/Catellus team.
In 2022, City Council approved a new General Plan Housing Element for the period 2023-2031. Housing Element Program #1 commits the City of Alameda to take all necessary actions to facilitate and expedite the construction of the RESHAP and West Midway projects.
On May 8, 2023, the Planning Board unanimously approved the new RESHAP Development Plan and recommended that City Council approve the new RESHAP DA.
On May 22, 2023, the Planning Board unanimously approved the West Midway Development Plan and recommended that City Council approve the West Midway DA.
DISCUSSION
The RESHAP Development Plan approved by the Planning Board in May is consistent with the Alameda General Plan, Main Street Neighborhood Specific Plan, and the Alameda Point Zoning Ordinance policies, standards, and development densities for the 8-acre project site. The approved plan includes 309 housing units and shelter for extremely low, very low, and low income households, associated services and community spaces, and up to eight units for on-site managers and staff.
The 2023 Development Plan differs from the Development Plan approved in 2018 in that it is located on a different site at Alameda Point and the number of housing units has been increased. Similar to the 2018 Development Plan, the 2023 Development Plan includes approximately 40,000 square feet of community space for services programming and administrative offices for the Collaborating Partners, on-site property management and resident services.
The 2023 Development Plan provides an accessible, pedestrian-oriented community campus with safe common spaces for residents who may have suffered from past traumas, while also providing residents opportunities to connect to the larger Main Street Neighborhood through strategic park and open space placement and street design. An active farm and new “barn” structure will serve as a gathering space for residents, including a commercial kitchen within close proximity to APC’s existing Ploughshares Nursery and farm, supporting the site’s “urban agriculture” image and identity along Main Street. A well landscaped community plaza connects the barn and ground floor community spaces where residents receive supportive services and socialize, and a variety of smaller open spaces at different scales, including courtyards, children’s play areas, indoor community spaces and private open spaces are designed to support this unique community.
Four main residential and mixed-use buildings provide for the apartment units. The buildings are three- and four-story elevator-served buildings. The RESHAP Development Plan exceeds the City’s Universal Design Ordinance requirements. Two buildings will include APC residents, one building will serve Operation Dignity residents, and the fourth building will serve Building Futures. Commercial spaces will be located on the ground floor of residential buildings facing Pan Am Way, and non-residential commercial uses, including administrative offices, will be included in one of the APC buildings and in the Building Futures building.
The Collaborating Partners are current members of the Alameda Transportation Management Association (ATMA), which provides Alameda Point residents and tenants with transit passes, electric bicycle rebates, and other transportation services. As Alameda Point continues to grow, the services provided by the ATMA to its members will also increase. The project site is served by AC Transit Line 96 and is within walking distance of two ferry terminals with direct access to Oakland and San Francisco.
Parking is provided in a combination of surface parking lots and a garage in the Phase 1 APC building. (Currently, less than one-third of the APC residents at Alameda Point own a car.) The automobile parking plan is consistent with the parking requirements of the Main Street Neighborhood Specific Plan and the Alameda Municipal Code (AMC) Parking Regulations. Long- and short-term bicycle parking facilities will also be provided consistent with the AMC requirements.
No action is required by City Council on the RESHAP Development Plan; however, for the RESHAP project to commence, City Council action is required on the following resolutions and ordinances:
I. Surplus Land Resolution
Prior to taking any action to dispose of (i.e., sell or convey) land owned by the City, the Surplus Land Act [Government Code Section 54221(b)(1)] requires the City to declare the land "surplus land" or “exempt surplus land" as supported by written findings. The resolution declares the 8-acre RESHAP property and the adjacent West Midway property to be “exempt surplus land” under the Surplus Land Act. This declaration and finding allows City Council to convey the City-owned land to the Collaborating Partners and to the West Midway developers consistent with the terms of the recommended DDAs for each project.
The resolution declares that the 8-acre RESHAP Property and the adjacent 26-acre West Midway Property are “exempt surplus land” under the Surplus Land Act and may be conveyed to the RESHAP and West Midway developers based upon the following summarized sets of findings, which are set forth in greater detail in the attached Surplus Land Act Resolution:
Findings pursuant to Government Code Section 54221(f)(1)(J)
• The property is located on a former military base, which has an aggregate area greater than five acres, includes a mix of residential and nonresidential uses, and is expected to include no fewer than 1,400 residential units upon completion of development or redevelopment on the base.
• The affordability requirements for residential units on the base are governed by a settlement agreement entered into on March 20, 2001 (the Renewed Hope Settlement Agreement) and at least 25 percent of the residential units developed on the base are restricted to lower income households. Inclusive of the RESHAP, West Midway, and Site A projects, the City will have granted approvals for developments and has agreements with the developers of those developments that contemplate the development of 2,071 residential units on Alameda NAS, 622 of which are proposed to be occupied by very low and low income households at affordable rents, as defined in Health and Safety Code Sections 50052.5 and 50053 for a minimum of 55 years.
• Prior to disposition of the surplus land, the City will have adopted written findings that the land is exempt surplus land as set forth in the attached Surplus Land Act Resolution.
• The DDAs require RESHAP and West Midway to negotiate a project labor agreement consistent with the City’s Project Stabilization Agreement resolution, as adopted on February 2, 2021.
• The City does and shall continue to include, in its annual report on the Status of the General Plan and Housing Element implementation required by paragraph (2) of subdivision (a) of Section 65400 of the Government Code, the status of development of residential units on the Alameda NAS.
Findings pursuant to Government Code Section 54221(f)(1)(A)
• At least 80% of the area of the 34.5 acres to be developed by RESHAP and West Midway will be used for the development of housing, and that at least 40% of the total housing units are restricted to low and very low incomes as specified under Government Code section 37364.
II. Disposition and Development Agreement Ordinance
The DDA establishes a contractual relationship between the City of Alameda, MidPen, and each of the Collaborating Partners (Exhibit 2). The DDA contemplates that with respect to each of the buildings within the RESHAP project, one of the Collaborating Partners and MidPen will form a limited partnership that will take title to the land and be responsible for the development of the affordable housing. The limited partnerships are referred to in the DDA as “Developer Affiliates”. Pursuant to the terms of the draft DDA:
• Term. The Developer and the Collaborating Partners have ten (10) years with up to five (5) one-year extensions to construct and complete the project. During the term of the agreement, each party has certain milestone commitments to ensure the timely delivery of land and construction of buildings.
• Phases. The City will convey ownership of the RESHAP property to the Developer Affiliates in four phases (one phase for each building). Prior to conveyance of each phase, the Developer Affiliate will verify that it has financial resources secured to construct the building, and the City will verify that the land to be conveyed has been prepared for construction, including construction of new infrastructure serving the property, demolition of existing buildings, and any necessary surcharging of the land has been completed.
• Affordable Housing. A Regulatory Agreement restricting each phase to Very Low and Low-income will also be recorded against each phase of the RESHAP project at the time of conveyance to ensure that the land is permanently restricted for use for supportive and affordable housing.
• Ownership. The Developer Affiliates are responsible for the construction, operation and maintenance of the new 309-unit campus.
• Existing Leases. Upon relocation of existing residents into each new building, the Collaborating Partners will terminate their existing leases on the recently vacated City owned land.
• Additional Affordable Units. The Developer Affiliates will work in good faith with the City of Alameda to increase the number of supportive housing units to be developed on the 8.5-acre site. The need for housing for Alameda’s most vulnerable residents is acute and the Planning Board approved plan for 309 units represents a relatively low density (less than 40 units per acre). Given these conditions, the Collaborating Partners will work with the City to increase the total number of very low and low income units on the site by at least an additional 20 units for a total of at least 329.
City Financial Commitments. The DDA represents a significant financial commitment by the City of Alameda to the preservation and expansion of much needed supportive housing at Alameda Point. This financial commitment is comprised of three (3) major commitments:
• Land. The City is committing to provide eight acres of City owned land to the Development Affiliate at no cost. The land was received by the City from the U.S. Navy at no cost. In return for the donation of the land to the project, the Collaborating Partners will terminate their existing leases on 32 acres of land when the RESHAP residents are relocated to the new campus. Once the leases are terminated for lands north of West Midway Avenue, the City will have opportunities to redevelop and reuse those lands for future users. The vacated leased lands south of West Midway Avenue are either part of the RESHAP 8-acre property or they are lands that will be conveyed to Brookfield/Catellus for the adjacent West Midway project.
• Construction Funding. The City is committing $9.5 million in Alameda Point fund balance (Fund 290) for the construction of the necessary infrastructure and site preparation for the first two phases of the four phases of the RESHAP project. Under the terms of the West Midway DDA (see West Midway Staff Report), the City will loan Catellus/Brookfield an amount not-to-exceed $9.5 million to construct infrastructure and prepare approximately 4 acres of the 8-acre RESHAP property for construction. The work will be completed for the first RESHAP building (APC first building) in 2024 and the second building (Operation Dignity first building) in 2025. Catellus/Brookfield is responsible to repay the $9.5 million loan after they begin construction of the adjacent market rate West Midway project in accordance with the terms of the West Midway DDA (File 2023-3182). This loan of Alameda Point residual funds allows work to begin on the RESHAP property immediately. Without the loan, Catellus/Brookfield would not be able to begin work on the RESHAP property until such time that they decide the market conditions are right to begin work on the market rate West Midway Project. Under the terms of the West Midway DDA, market conditions could delay the start of work on the West Midway project unit 2027. With the loan, work on RESHAP is guaranteed to begin in 2023.
• Building 92 Early Termination. The future success and continued redevelopment of Alameda Point depends upon the City of Alameda’s financial capacity to continue to build new infrastructure for the Naval Air Station Alameda Historic District and adaptive reuse area of Alameda Point. The future of all the existing businesses west of Pan Am Way are dependent on the City’s ability to replace all of the existing infrastructure and utilities west of Pan Am Way. The City’s primary source of revenue for this work is the sale of existing buildings in the adaptive reuse area. As part of the RESHAP DDA, APC has agreed to an early termination of their existing lease for Building 92 in the adaptive reuse area, which will allow the City to sell Building 92 and use those funds to continue the construction of infrastructure at Alameda Point. In return for forgoing the remaining 35 years on the existing lease, APC will receive $500,000 from the City upon sale of Building 92. (The City’s most recent appraisal of Building 92 sets the market value of Building 92 far in excess of $10 million.) APC anticipates using the $500,000 received to complete improvements to the APC Farm on Main Street.
III. Development Agreement Ordinance
The proposed 2023 RESHAP DA (Exhibit 3) differs from the 2018 approved RESHAP DA in that it is an agreement for a development on a different site at Alameda Point and the number of supportive housing units has been increased. Similar to the 2018 Development Plan, the 2023 Development Agreement provides vested rights to develop the project for 10 years. In all other respects, the draft 2023 DA is similar to the DA adopted by City Council in 2018 for the previous site. The parties intend to terminate the 2018 DA concurrently with approval of the proposed 2023 DA.
The 2023 DA ensures that:
• The City Planning Board’s approval of the 2023 Development Plan will be vested for more than two years. The DA extends the life of the RESHAP project approvals for the 10-year term of the DDA.
• The construction of the RESHAP campus will comply with the project approvals.
• The City will process subsequent approvals required for the project (such as design review and subdivisions maps) in accordance with the project approvals.
• Future changes in City codes, regulations, standards or fees that conflict with the project approvals will not apply to the development of the project, absent a health or safety impact or conflict with federal or state law. All existing 2023 codes, regulations, standards, and fees must be followed by City and Developer, but new codes, regulations or standards that conflict or prevent development of the project that are approved after approval of the 2023 DA will not be applied to the project.
ALTERNATIVES
After opening the public hearing and considering all of the documents, City Council could consider a number of alternative courses of action, including, but not limited to:
• Approve the above-described resolutions and ordinances for the RESHAP project as recommended by staff.
• Approve the Surplus Land Act Resolution but not the other resolution and ordinances with direction to staff to renegotiate certain specified terms based on specific City Council concerns and direction. In this scenario, staff would recommend that City Council delay action on the West Midway project, if the specified concerns and direction relate to the budget amendment, the phasing of the RESHAP project, or any aspect of the RESHAP project that is also dependent on close coordination with the West Midway Project.
• If City Council is not comfortable approving the Surplus Land Act Resolution, City Council should indicate whether City Council wishes staff to delay all further work on the RESHAP project until such time that the City has issued an RFP soliciting interest from other affordable housing developers for development of the 8-acre property for affordable housing pursuant to the Surplus Land Act. Staff does not recommend this alternative, since it would certainly cause the need for a delay for the West Midway project approvals, which are subject to an ENA that is predicated on the assumption that City Council is supportive of a direct transfer of the 8-acre property to RESHAP.
FINANCIAL IMPACT
The recommended resolutions and ordinances are specifically designed to have no negative fiscal impact on the City’s General Fund and to ensure that the development of the subject properties at Alameda Point are fiscally neutral to the General Fund consistent with City Council adopted policy (File no. 2023-2841).
As discussed above, the proposed RESHAP DDA includes conveyance of 8-acres of City owned land to the Development Affiliate at no cost. In return, the Collaborating Partners will terminate their existing leases on 32 acres of land when the RESHAP residents are relocated to the new campus. As the 32 acres are currently leased at no cost, the opportunity to redevelop and reuse the 32 acres of City owned land will result in a net increase in the income potential of the City owned lands. In addition, the proposed RESHAP DDA also includes payment of $500,000 from the City to APC for early termination of their lease of Building 92, upon the sale of Building 92. APC will be paid from the proceeds of the sale, which are expected to far exceed the early termination payment.
MUNICIPAL CODE/POLICY DOCUMENT CROSS REFERENCE
The recommended ordinances and resolutions are consistent with the City’s General Plan policies related to the redevelopment and reuse of Alameda Point, the Main Street Neighborhood Specific Plan, the Alameda Municipal Code regulations and development standards for the 8-acre property.
ENVIRONMENTAL REVIEW
Pursuant to the streamlining provision of Public Resources Sections 21166 and 21083.3 and Sections 15162 and 15183 of the CEQA Guidelines, no further environmental review is required because the RESHAP project is consistent with the development density in an adopted Specific Plan for the area; the environmental impacts of the development of the area consistent with the Specific Plan were considered in the Alameda Point Project Final Environmental Impact Report (APP FEIR) adopted by City Council on February 4, 2014, in compliance with CEQA; the RESHAP project is consistent with the development density of, is specifically listed in, and implements the City’s Housing Element adopted on November 15, 2022; the environmental impacts of the Housing Element and the development of the sites included in the Housing sites inventory were considered in the General Plan Update EIR adopted by City Council on November 30, 2021; and as documented in the project CEQA Checklist and Mitigation Monitoring and Reporting Program (MMRP) (Exhibit 4), the RESHAP project would not result in new or substantially more severe significant impacts than identified in the APP FEIR or the General Plan Update FEIR due to changes in the project, changed circumstances, or new information and there are no new or considerably different feasible mitigation measures or alternatives from those identified in the APP FEIR or the General Plan Update FEIR that would substantially reduce one or more significant effects that the project proponent declines to adopt; and the RESHAP project would not result in significant impacts that: (1) are peculiar to the project or project site; (2) were not already identified as significant effects, cumulative effects, or off-site effects in the APP FEIR and the General Plan Update FEIR; or (3) were previously identified as significant effects; but are determined to be substantially more severe than discussed in the APP FEIR and the General Plan Update FEIR.
CLIMATE IMPACT
The proposed project is consistent with and helps implement the Bay Area’s Sustainable Communities Strategy, Plan Bay Area and the City’s Climate Action Plan by supporting and facilitating the development of a designated regional Priority Development Area with low income and supportive housing within a transit-oriented development well served by transportation services.
RECOMMENDATION
Hold a public hearing to: 1) adopt a resolution declaring the Rebuilding Existing Supportive Housing at Alameda Point (RESHAP) property and the adjacent West Midway Property located at the corner of West Midway Avenue and Pan Am Way at Alameda Point to be exempt surplus land under the Surplus Land Act; 2) introduce an ordinance authorizing the City Manager to execute a DDA between the City and the Collaborating Partners and MidPen for the development of the RESHAP property; and 3) introduce an ordinance authorizing the City Manager to execute a DA between the City and the Collaborating Partners and MidPen.
Respectfully submitted,
Andrew Thomas, Interim Base Reuse and Economic Development Director
Financial Impact section reviewed,
Margaret O’Brien, Finance Director
Exhibits:
1. RESHAP Development Plan
2. Development and Disposition Agreement
3. Development Agreement
4. CEQA Checklist and Mitigation Monitoring and Reporting Program