HomeMy WebLinkAboutR-11072 approving an Affordable Housing Fund award to Peoples' Self-Help Housing for Broad StreetRESOLUTION NO. 11072 (2020 SERIES)
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS
OBISPO, CALIFORNIA, APPROVING AN AFFORDABLE HOUSING
FUND AWARD TO PEOPLES' SELF-HELP HOUSING CORPORATION
FOR BROAD STREET PLACE IN THE AMOUNT OF $1,300,000.
WHEREAS, the City Council of the City of San Luis Obispo met in the Council Chamber
of City Hall, 990 Palm Street, San Luis Obispo, California, on January 21, 2020, for the purpose
of considering a request for Affordable Housing Fund (AHF) assistance; and
WHEREAS, the proposed project, Broad Street Place, by Peoples' Self-Help Housing
Corporation (PSHHC) meets the award eligibility criteria established by the City Council; and
WHEREAS, Housing Element policies and programs encourage and support the
construction of new affordable housing in the City; and
WHEREAS, the City Council has duly considered all evidence, including the testimony
of the applicant, interested parties, and the evaluation and recommendations by staff at the said
meeting; and
NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Luis Obispo
as follows:
SECTION 1. Findings. The City Council does hereby make the following findings in
support of the proposed AHF awards:
1. Eligibility: Use of the AHF for the requested purpose will increase or improve the
City's affordable housing inventory and promote General Plan policies regarding
housing, as follows:
Broad Street Place is eligible for Affordable Housing Funds because it increases the
City's affordable housing inventory and implements several General Plan policies
regarding housing. The project will increase the supply of affordable housing for
extremely low, very low, and low-income households with the construction of 40 units.
2. Need: There exists a substantial or overarching need for the type of unit to be assisted,
as follows:
By proposing 40 units, PSHHC will be significantly contributing to the City's RHNA
allocation for the extremely low, very low, and low-income categories. Housing needs
in general are growing along the coastal areas and this particularly true for lower
income households. San Luis Obispo will benefit greatly from this development
because of the increased density that comes with the proposal as well as deeper AMI
targeting.
R 11072
Resolution No. 11072 (2020 Series) Page 2
3. Suitability: The project to be assisted is appropriate for its location both in terms of
land use and design, as follows:
Broad Street Place is designed to be consistent with the character of the neighborhood,
taking cues from the adjacent Iron Works affordable housing development as well as
other commercial, industrial, and residential buildings in the vicinity. The development
of this parcel will improve a vacant and underutilized property in an urbanized area in
the City and enhance the Broad Street corridor by creating new mixed-income and
affordable rental housing opportunities, as well as new high quality commercial space
for small businesses along Broad Street frontage.
4. Timing: The project would better serve the City's needs if it were built immediately as
opposed to later, as follows:
Broad Street Place has received all local approvals and is preparing to submit for a
building permit application. PSHHC is ready to receive local funds to assist in
leveraging competitiveness for California low income tax credits, when they apply in
July 2020. As PSHHC moves forward with retaining additional funding sources,
commitment of local funds enhances the time-value of financing; realizing a project
sooner rather than later, with all associated due diligence review and analysis,
represents potential cost savings related to the local community investment.
5. Financial Effectiveness: But for the requested funding, the project would not be
economically feasible; or AHF funding "leverages" significant additional funding from
other sources, as follows:
In terms of financial feasibility, early commitment of local affordable housing funds is
important. These funds provide basis for attracting additional funding sources as they
demonstrate local support and commitment to the development. Along with other
forms of shallow subsidies such as, the Federal Home Loan Bank's Affordable Housing
Program (AHP), federal HOME and CDBG funds, and other potential resources, they
serve as leverage for significant sources such as tax credit financing. All tax credit
funding applications score maximum points with respect to project scoring criteria, the
ultimate tiebreaker is the amount of commitment of additional financing from other
resources. Tax credit financing often represents upwards of 50% plus of overall project
financing and the amount of tax credits awarded a project is underwritten in the context
of the "gap" between committed funds and total development costs. To leverage tax
credit funding is of great community benefit and in some measure may be up to a 1-to-
10 ratio between what local fund and other project financial resources. Thus, the
development's financial feasibility is dependent upon City Affordable Housing Funds.
R 11072
Resolution No. 11072 (2020 Series) Page 3
6. Readiness: The project has all necessary City approvals and is ready to proceed, as
follows:
PSHHC has obtained all the necessary City discretionary approvals for Broad Street
Place. Upon the award of a City Affordable Housing Fund award, PSHHC will be
eligible to apply for additional public funding programs and other private activity bond
financing. Should the project receive all funding, PSHHC anticipates starting
construction in 2020.
SECTION 2. Environmental Determination. The project to award affordable housing
funds is exempt from environmental review per Section 15061(b)(3) General Rule of the CEQA
Guidelines. It can be seen with certainty that the proposed action to award grant funding will have
no significant effect on the environment.
R 11072
Resolution No. 11072 (2020 Series) Page 4
SECTION 3. AHF Award for People Self-Help Housing Corporation. The City Council
does hereby approve an AHF award in an amount not to exceed $1,300,000, subject to the
following condition of approval:
1. Prior to release of any portion of the AHF award, the applicant shall enter into an
affordability agreement with the City for forty ( 40) for-rent affordable housing units
located at 3720 Broad Street for a term of fifty-five (55) years, which will be recorded
against the title of the property.
Upon motion of Council Member Christianson, seconded by Council Member Stewart, and
on the following roll call vote:
AYES:
RECUSED:
ABSENT:
Council Member Christianson, Stewart and Vice Mayor Gomez
Council Member Pease
Mayor Harmon
The foregoing resolution was adopted this 21st day of January 2020 .
ATTEST:
~~
City Clerk
· stine Dietrick
City Attorney
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City
of San Luis Obispo, California, this 2~ day of ::J"""CJ....111 v-o....v-, 2020.
Teresa Purrington
City Clerk
R 11072