HomeMy WebLinkAboutItem 6h. Approve Cooperative Agreement with PSHH for Calle Joaquin Homekey Project and amendments to Resolution 11439 (2023 Series) Item 6h
Department: Community Development
Cost Center: 4008
For Agenda of: 4/16/2024
Placement: Consent
Estimated Time: N/A
FROM: Timmi Tway, Community Development Director
Prepared By: Teresa McClish, Housing Policy and Programs Manager
Daisy Wiberg, Homelessness Response Manager
SUBJECT: APPROVE COOPERATING AGREEMENT WITH PEOPLE’S SELF-HELP
HOUSING FOR THE CALLE JOAQUIN HOMEKEY PROJECT AND
APPROVE AMENDMENTS TO RESOLUTION NO. 11439 (2023 SERIES)
RECOMMENDATION
1. Approve the Cooperating Agreement with People’s Self-Help Housing for the Calle
Joaquin Homekey Project and authorize the City Manager, or their designee, to
execute the agreement; and
2. Approve amendments to Resolution No. 11439 (2023 Series).
POLICY CONTEXT
The City’s General Plan 6th Cycle Housing Element1 includes Safety as Goal 1, and
Program 1.7 states “Continue to support local and regional solutions to homelessness by
funding supportive programs services and housing solutions.”
Additionally, providing financial assistance to af fordable housing projects is a theme
supported throughout the Housing Element. Housing Element Goal 2 is Affordability,
which specifically states “Accommodate affordable housing production that helps meet
the City’s quantified objectives.” HE Program 2.9 states “Assist with the issuance of tax-
exempt bonds, tax credit financing, loan underwriting or other financial tools to help
develop or preserve at least 20 affordable units annually through various programs.”
Goal 3 in the HE is Housing Conservation, to Conserve existing housing and prevent the
loss of safe housing and the displacement of current occupants, and Policies 3.3, 3.5 and
Program 3.9 respectively state:
“Encourage the construction, preservation, rehabilitation or expansion of
residential hotels, group homes, integrated community apartments, and single -
room occupancy dwellings;”
“Encourage and support creative strategies for the rehabilitation and adaptation
and reuse of residential, commercial, and industrial structures for housing;” and
1 City of San Luis Obispo 6th Cycle Housing Element
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Item 6h
“Work annually with non-profit organizations, faith-based organizations, or the
Housing Authority of the City of San Luis Obispo to encourage rehabilitation of
residential, commercial, or industrial buildings to expand extremely low, very -low,
low- or moderate-income rental housing opportunities.”
HE Goal 6 is Housing Production, which specifically states “Plan for new housing to meet
the full range of community housing needs.” HE Program 6.20 states, “Continue to
financially assist in the development of housing affordable to extremely low, very-low-,
low- or moderate-income households during the planning period using State, Federal and
local funding sources, with funding priority given to projects that result in the maximum
housing benefits for the lowest household income levels.”
Additionally, the City’s Homelessness Response Strategic Plan includes Objective 2: to
support efforts to establish emergency/transitional housing for key beneficiary groups
including chronically homeless individuals, medically vulnerable individuals, and families,
with a key task to establish partnerships with housing developers and homeless services
providers to submit funding applications in coordination with the County (e.g., Homekey
Grant Funding) that will provide new transitional and permanent supportive housing
resources for families.2
DISCUSSION
Background
On March 29, 2023, the California Department of Housing and Community Development
(HCD) announced a notice of funding availability (NOFA) of approximately $736 milli on
in Round 3 Homekey funds to sustain and rapidly expand the inventory of housing for
people experiencing homelessness or at risk of homelessness.
On May 16, 2023, the San Luis Obispo County Board of Supervisors authorized a total of
$2.6 million for the Homekey project to cover the estimated $650,000/year in project costs
for four years. A subsequent commitment letter from the County authorized the project
funding to be allocated for capital, renovations, and operations for the project.
On July 24, 2023, the City Council adopted a resolution3 authorizing the submittal of a joint
application for Homekey Round 3 grant program funds in conjunction with People’s Self-
Help Housing (PSHH) for the proposed acquisition, rehabilitation and conversion of the
87-unit Motel 6 North located at 1433 Calle Joaquin in San Luis Obispo.
On December 19, 2023, and revised on January 18, 2024, HCD provided the City and
PSHH a conditional Homekey Round 3 award commitment and acceptance of terms and
conditions for the Calle Joaquin Homekey project for a capital award amount of
$17,414,328 and operating award of $1,943,942. On January 22, 2024, the City Manager
and CEO for PSHH, as co-applicants, executed the conditional award letter for Homekey
Round 3 funding.
2 City of San Luis Obispo Homelessness Response Strategic Plan
3 Resolution No. 11439
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Item 6h
Cooperating Agreement
The proposed Cooperating Agreement between the City and PSHH will provide the terms
and provisions for the City and PSHH to construct and operate the Calle Joaquin Homekey
project in accordance with the Homekey Standard Agreement, which will be drafted by HCD.
The proposed Cooperating Agreement (Attachment A) includes a provision requiring that it
shall be construed to be consistent with the Standard Agreement. The Homekey Program
is intended to meet urgent housing needs, and as suc h, requires aggressive
implementation timelines. Homekey capital funds must be expended within eight months
of the date of award, December 19, 2023. Acquisition, rehabilitation and/or construction
must be completed twelve months form the date of award and full occupancy must be
achieved by fifteen months from the date of award.
The City and PSHH anticipate receiving the Standard Agreement from HCD in April 2024
and, upon receiving the agreement, will confirm that the terms of the Cooperating Agreement
are consistent with the Standard Agreement. Staff request authorization to amend the
Cooperating Agreement to address any non-substantive inconsistencies, since staff
anticipate that HCD’s Standard Agreement will not be negotiable. Staff is bringing forward
this Cooperative Agreement in advance of the Standard Agreement due to the fast project
timeline and need to continue to move the project forward. Staff does not anticipate
substantive changes to the Cooperating Agreement; PSHH is familiar with the HCD Standard
Agreement and was involved in the drafting of the Cooperating Agreement as a signing party.
Council’s authorization to apply for the program included an acknowledgement that the City
shall be subject to the terms and conditions of the Standard Agreement.
Resolution Amendments
The State of California’s Department of Housing and Community Development (HCD),
the entity which awards funds under the Homekey Program, requested correction s be
made to the City of San Luis Obispo’s Resolution No. 11439 (2023 Series) for the Calle
Joaquin Homekey project. Previously, on March 21, 2024, some non-substantive
amendments were previously made administratively regarding the naming of all co -
applicants for the project and the resolution was amended to include the City, Peoples
Self-Help Housing Corporation (“Co-Applicant 1”), Calle Joaquin Homekey LLC (“Co-
applicant 2”), quin LP (“Co-Applicant 3”). HCD has requested additional amendments to
the previously adopted resolution that staff have determined require Council approval.
Prior to issuing a Standard Agreement for the Calle Joaquin Homekey project, HCD has
requested amendments to the Resolution regarding the anticipated project cost and
funding sources. When the originally adopted Resolution was executed, an anticipated
award amount of $15,000,000 (with a not -to-exceed authorization of up to $22,000,000)
was included in the Resolution, however the final award amount requested on the
Homekey Round 3 application was $21,528,657. HCD requested the Resolution be
amended to remove the anticipated award amount of $15,000,000 and replace it with the
authorized amount not to exceed $22,000,000. Additionally, HCD requested that the
City’s $400,000 Affordable Housing Funds (AHF) commitment be included in the
Resolution as well as naming additional funding sources including: $150,000 Wells Fargo
Homekey Accelerator Funding and $164,329 Deferred Developer Fee. All requested
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Item 6h
revisions are included in the amended resolution (Attachment B). The three sections of
the amended Resolution are outlined below, including language from the originally
adopted Resolution and the proposed amendments to the Resolution:
Update #1 – Originally Adopted Resolution, Page 2, Section 3, Findings, No. 1:
“The City Manager or their designee is hereby authorized and directed to submit a
joint Application to the Department in response to the NOFA, and to jointly apply for
Homekey grant funds for an anticipated project cost of $15,000,000. Per the Homekey
grant provisions, it is recommended to identify an authorized dollar amount that is at least
double the anticipated award. In line with available funding allocation for the Central Coast
Geographical Area, the total authorized amount shall not exceed $22,000,000.”
The amended resolution will state:
“The City Manager or their designee is hereby authorized and directed to submit a
joint Application to the Department in response to the NOFA, and to jointly apply for
Homekey grant funds for an anticipated project cost not to exceed $22,000,000. Per the
Homekey grant provisions, it is recommended to identify an authorized dollar amount that
is at least double the anticipated award. In line with available funding allocation for the
Central Coast Geographical Area, the total authorized amount shall not exce ed
$22,000,000.”
Update #2 – Originally Adopted Resolution, Page 2, Section 1, Findings:
“SECTION 1. Findings. The City Council does hereby make the following findings
in support of the proposed AHF awards:”
The amended Resolution will state:
“SECTION 1. Findings. The City Council does hereby make the following findings
in support of the proposed $400,000 AHF award:”
Update #3 – Originally Adopted Resolution, Page 3, Section 1, No. 5, Financial
Effectiveness, Paragraph 2:
“This is a highly effective use of the City’s Affordable Housing Funds, as it will
leverage additional funding sources as they demonstrate local support and commitment
to the development. These funding sources include the Homekey Grant Round 3 $15
million, County of San Luis Obispo $2.6 million; and Private Foundation funding $800,000.
Project financial feasibility is dependent upon Affordable Housing Funds.”
The amended resolution will state:
“This is a highly effective use of the City’s Affordable Housing Funds, in the amount
of $400,000, as it will leverage additional funding sources as they demonstrate local
support and commitment to the development. These funding sources include the
Homekey Grant Round 3 award for an anticipated project cost of $21,528,657; County of
San Luis Obispo funding commitment in the amount of $2.6 million; Private Foundation
funding in the amount of $800,000; $150,000 Wells Fargo Homekey Accelerator funding;
and $164,329 Deferred Developer Fee. Project financial feasibility is dependent upon the
City’s Affordable Housing Funds.”
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Item 6h
The requested amendments to the Resolution are consistent with the partnership
structure outlined in the Homekey Round 3 grant application and do not alter the project,
partnership, or the City’s financial obligations in any way. The anticipated award amount,
Affordable Housing Fund commitment from the City, and additional funding sources were
all outlined in the final Homekey Round 3 application that the City and PSHH submitted
to HCD in July 2023.
Staff will submit the amended Resolution to HCD so that the Calle Joaquin Homekey
project may move forward.
Next Steps
PSHH will administer subrecipient agreements with the County of San Luis Obispo ,
5Cities Homeless Coalition, and other service providers for the provision of ongoing
funding and services at the project site. The Balay Ko Foundation, a nonprofit corporation,
has also committed up to $800,000 in gap funding for the project and the Wells Fargo
Accelerator Fund contributed $150,000. The Housing Authority of San Luis Obispo
(HASLO) will provide 60 Project Based Vouchers as Operational Subsidy in years 4 -14
of the project.
The tentative project timeline for the Calle Joaquin Homekey project, which is subject to
change, includes the following estimated milestones:
Property Acquisition – May 2024
Start of Rehabilitation & Construction – June 2024
Collaboration with County and Service Providers on Coordinated Entry System for Calle
Joaquin Homekey Housing Placements – August 2024
Rehabilitation & Construction Complete – December 2024
Leasing Process Begins for Permanent Supportive Housing (PSH) Units – January 2025
Calle Joaquin Homekey Opening – March 2025
Previous Council or Advisory Body Action
On July 24, 2023, the City Council adopted a resolution authorizing the submittal of a joint
application for Homekey Round 3 grant program funds in conjunction with People’s Self-
Help Housing for the proposed acquisition, rehabilitation, and conversion of the 87-unit
Motel 6 North located at 1433 Calle Joaquin4.
The Resolution grants the City Manager, or their designee, authorization to enter into,
execute, and deliver a Standard Agreement in a total amount not to exceed $22,000,000,
and any and all other documents required or deemed necessary or appropriate to se cure
the Homekey funds from HCD and to participate in the Homekey Program, and all
amendments thereto.
4 Resolution No. 11439
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Item 6h
The Resolution also includes an acknowledgement that the City shall be subject to the
terms and conditions specified in the Standard Agreement. The Ci ty Manager, or their
designee, is authorized in the Resolution to execute the Homekey Documents on behalf
of the City for participation in the Homekey Program and to execute such other documents
and take such other actions consistent with the purposes of the grant as necessary to
accept and comply with grant requirements and implement the project.
On March 21, 2024, the Resolution was administratively amended to include additional
project co-applicants, per the request of HCD5. PSHH created a Limited Liability Company
(LLC), Calle Joaquin Homekey LLC, and a Limited Partnership (LP), Calle Joaquin LP, for
the Homekey project, and HCD requested that both entities be listed as additional co -
applicants on the Resolution. The requested amendment to the resolution was consistent
with the partnership structure outlined in the Homekey Round 3 grant application and did
not alter the project, partnership, or the City’s financial obligations in any way.
Public Engagement
On October 11, 2023, PSHH noticed Calle Joaquin neighbors and stakeholders and
conducted an informational meeting at City Farm SLO to provide an overview of the
proposed project. Only one neighboring business attended but City staff have been
responding to public inquiries regarding the project.
The City and PSHH plan to conduct additional community outreach to neighboring
businesses and stakeholders in advance of the project groundbreaking, including
providing an overview of the project timeline. Key stakeholders will be invited to a
groundbreaking event for the Calle Joaquin Homekey project and additional community
engagement opportunities will be provided throughout the development of the project.
CONCURRENCE
The Homelessness Response Steering Committee is in support of the agreement.
ENVIRONMENTAL REVIEW
As provided by Health and Safety Code section 50675.1.4, the guidelines allow for
exemption of this Round 3 Homekey Project from the California Environmental Quality
Act (CEQA). Compliance with Section 50675.1.4 is a material term of the Cooperating
Agreement, and a Notice of Exemption has been filed. Additionally, a finding of no
significant impact will be filed in accordance with the National Environmental Policy Act
(NEPA) for the provision of Homekey funds.
FISCAL IMPACT
Budgeted: No Budget Years: 2023-24 & 2024-25
Funding Identified: Yes
5 Amended Resolution No. 11439
Page 238 of 346
Item 6h
Fiscal Analysis:
Funding
Sources
Total Budget
Available
Current
Funding
Request
Remaining
Balance
Annual
Ongoing
Cost
General Fund $ $ $ $
State $19,358,270 $0 $19,358,270
Federal
County $2,600,000 $0 $2,600,000
Fees
Other: AHF $400,000 $0 $400,000
HASLO 60
Project Based
Vouchers
Operational
Subsidy (Years
4-14)
$0
Private
Donation
$800,000 $0 $800,000
Wells Fargo
Accelerator
Fund
$150,000 $0 $150,000
Total $23,308,270 $0 $23,308,270
City Council’s approval of the Cooperating Agreement does not have fiscal implications.
The fiscal analysis reflects the Homekey project budget as previously approved on July
24, 2023.
ALTERNATIVES
1. Council could deny approval of the Cooperating Agreement with PSHH. Under
this alternative, the City and its co-applicant would have no agreed terms to manage
the Calle Joaquin Homekey project. Staff does not recommend this alternative.
2. Council could deny approval of the amendments to Resolution No. 11439. Under
this alternative, the City would risk not being in compliance with HCD’s resolution
requirements for the Homekey Round 3 program and may encounter delays with
execution of the Standard Agreement. Staff does not recommend this alternative.
ATTACHMENTS
A - Draft Cooperating Agreement for Calle Joaquin Homekey Project
B - Amended Resolution No. 11439 (2023 Series)
Page 239 of 346
Page 240 of 346
COOPERATING AGREEMENT FOR HOMEKEY ROUND 3 PROJECT
THIS COOPERATING AGREEMENT (“Agreement”) is between the City of San Luis Obispo
(“City”) and People’s Self- Help Housing, a 501(c)(3) Corporation (“PSHH”). PSHH, is referred to as
“Developer.” City and PSHH are sometimes individually referred to as a “Party” and collectively as the
“Parties.” This Agreement will be effective as of the last date the Agreement is signed by all Parties
(“Effective Date”).
RECITALS
A. In response to the spread of COVID-19 in the State of California, Governor
Newsom secured Federal Emergency Management Agency (FEMA) approval for “Project
Roomkey”, a state-wide initiative with the intention of securing thousands of motel rooms to
provide non-congregate shelter for extremely vulnerable individuals experiencing homelessness
to help keep susceptible, homeless persons safe, flatten the curve, and preserve hospital capacity.
B. On June 15, 2020, the state of California passed a budget that included $550 million
for the purpose of rapidly expanding the inventory of housing available to homeless persons
currently served by Project Roomkey and subsequently launched the Homekey Program.
C. Following on the success of the 2020 Homekey Program, the State’s FY 2022-23
budget included funds for Homekey Round 3 administered by the Department of Housing and
Community Development (“HCD”).
D. On March 29, 2023, The California Department of Housing and Community
Development (HCD) announced the notice of funding availability (NOFA) of approximately $736
million in Round 3 Homekey funds to sustain and rapidly expand the inventory of housing for people
experiencing homelessness or at risk of homelessness and who are, thereby, inherently impacted by
or at increased risk for medical disease or conditions due to the COVID-19 pandemic or other
communicable diseases. The estimated Homekey funds for the Central coast geographic allocation
was $22,657,376.
E. On July 24, 2023, the City adopted a resolution authorizing the submittal of a joint
application for Homekey Round 3 grant program funds in conjunction with PSHH, a developer
who is experienced in affordable housing development and in providing housing assistance to those
experiencing homelessness, for the proposed acquisition, rehabilitation and conversion of 87-unit
Motel 6 located at 1433 Calle Joaquin San Luis Obispo, CA (“Project”).
F. On December 19, 2023, and revised January 18, 2024, HCD provided the City
and Developer a Homekey Round 3 conditional award for the Calle Joaquin Homekey project
(Contract No. 23-HK-18089) consisting of a capital award of $17,414,328 and operating award
of $1,943,942.
G. On January 22, 2024, the City and Developer, as co-applicants, executed the
conditional award for Homekey Round 3 funding.
H. To support the joint application for Homekey Round 3 program funding, the
Developer agreed to undertake the following activities:
1. Negotiate directly with property owner(s) and effectuating the purchase of the
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real property located at 1433 Calle Joaquin San Luis Obispo, CA (“Project
Site”);
2. Assist the City in obtaining state funding made available for the purpose of
acquiring the Project Site and applying for all other necessary Project financing;
3. Prepare and carry out a scope of work necessary to convert the Project Site into
housing that meets the criteria of Health and Safety Code section 50675.1.4 and
to create safe and habitable living spaces for up to 75 tenants who are homeless
or at-risk of homelessness; and,
4. Own, manage and operate the site as housing in compliance with the
requirements of the Homekey Round 3 Program and consistent with Health
and Safety Code section 50675.1.4.
I. To support the joint application for Homekey Round 3 program funding, and maximize the
investment of, Homekey Round 3 funds from the State, the City provided a local match contribution of
$400,000 from the City’s Affordable Housing Fund for the acquisition and rehabilitation of the Project site;
and the City initiated the review process required to obtain environmental clearance pursuant to the National
Policy Environmental Act (NEPA).
NOW, THEREFORE, in consideration of the recitals and mutual covenants and conditions
contained in this Agreement, incorporated herein, the Parties agree as follows:
1. Term.
1.1 The term of this Agreement will be from the date of execution until completion of the
tasks stated herein (the “Term.”) This agreement shall be construed to be consistent with the
Standard Agreement, which will be drafted by The Department of Housing and Community
Development. The Standard Agreement will be entered under the authority and in furtherance of
the Homekey Round 3 Program (“Agreement”). The Agreement shall be executed by the City of
San Luis Obispo and People’s Self-Help Housing, as co-grantees. The Agreement will incorporate
by reference the representations and descriptions included in the Homekey Round 3 application.
2. Project Development Tasks.
2.1 During the Term, the Developer’s responsibilities, with the cooperation from City staff,
include the followings tasks:
a) Negotiate with property owner(s) and effectuate the purchase of the Project Site;
b) Define a development schedule, including Project(s) milestones;
c) Undertake all such environmental review required by the National Environmental
Policy Act, as applicable, and acquire all use entitlements and/or permit approvals
to place the Project Site in a condition ready for development and construction of
the Project.
d) Identify and obtain required funding sources for the Project.
e) Assist the City in obtaining state funding made available for the purpose of acquiring
the Project Site utilizing Homekey Round 3 funds and to apply for all other necessary
Project financing;
f) Prepare and carry out a scope of renovation work necessary to create housing for
individuals and families who are experiencing homelessness or who are at-risk of
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homelessness that meets the criteria of Health and Safety Code section 50675.1.4;
g) Implement all the requirements of Health and Safety Code section 50675.1.4 for the
Project to be statutorily exempt from the California Environmental Quality Act; and
h) At the conclusion of the tasks defined above, PSHH shall own, manage and operate
the property throughout the required affordability periods pursuant to Homekey
Program requirements and Health and Safety Code section 50675 et seq., which shall
be no fewer than 55 years.
2.2 During the Term, the City will be a cooperative partner as the Lead Applicant for Homekey
application funds. The City’s primary tasks will include:
a) Obtain approvals required to apply for and receive Homekey program funding
including execution of the Standard Agreement with HCD.
b) Authorize and execute documents for required local match contribution.
c) Acting as Responsible Entity, take actions necessary to obtain National
Environmental Protection Act (NEPA) clearance.
d) Participate in project meetings to stay abreast of project development activities and to
facilitate communication as appropriate.
3. Developer Status.
3.1 Project Managers. The Project Manager for Developer will be PSHH.
3.2 Non-Assignability. With the exception of Developer-formed special purpose entity for
ownership and or future low-income housing tax credit investment, Developer will not assign this
Agreement or any portion thereof to a third party without the prior written consent of City, and any
attempted assignment without such prior written consent will be null and void and will be cause, at City's
sole and absolute discretion, for immediate termination of this Agreement.
3.3 Additional Financing. Development of the Project is a critical component of the City’s efforts
towards addressing homelessness and facilitating safe housing for those experiencing or at risk of
experiencing homelessness. Delays in development caused by Developer’s financial default will impede
these efforts. In acknowledgment of this, Developer agrees that it will not pursue any debt funding or
take any other action which would inure to any third party a financial interest in the Project without the
City’s express written consent in advance thereof.
4. Indemnification.
4.1 Indemnity. Each Party to this Agreement shall defend, indemnify, and hold harmless the other
Party, and their governing bodies, officials, officers, employees, and agents (“Indemnified Parties”) from
and against all claims, suits, actions, losses, and liability of every kind (collectively, “Liability”), arising
out of, connected with or resulting from the indemnifying Party’s negligence or willful misconduct in
carrying out its respective obligations under this Agreement, except to the extent such Liability is caused
by the negligence or willful misconduct of an Indemnified Party. This indemnification section shall survive
termination of the Agreement.
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5. Miscellaneous.
5.1 Notices. Formal notices, demands, and communications between City and Developer must be given
either by (i) personal service, (ii) delivery by reputable overnight document delivery service that provides
a receipt showing date and time of delivery, or (iii) or by U.S. first class certified mail, return receipt
requested, addressed to:
To City: City Executive Office
Attn: Timmi Tway, Community Development
Director
(805) 781-7187
ttway@slocity.org
To Developer: Peoples’ Self-Help Housing
Attn: Ken Trigueiro, CEO & President
(805) 540-2453
kennetht@pshhc.org
People’s Self-Help Housing
Attn: Veronica Garcia, Chief Real Estate Development Officer 805.651.3592
veronicag@pshh.org
Notices will be deemed effective upon receipt. Such written notices, demands, and communications
will be sent in the same manner to such other addresses as any party may from time to time designate by
mail.
5.2 Interpretation and Governing Law. The terms of this Agreement will be construed in accordance
with the meaning of the language used and will not be construed for or against any party by reason of the
authorship of this Agreement or any other rule of construction which might otherwise apply. The section
headings are for purposes of convenience only and will not be construed to limit or extend the meaning of
this Agreement. Any action arising out of this Agreement shall be brought in the Superior Court of San Luis
Obispo County, California. The validity, interpretation, construction and performance of this Agreement,
and all acts and transactions pursuant hereto and the rights and obligations of the Parties hereto shall be
governed, construed and interpreted in accordance with the laws of the State of California, without giving
effect to principles of conflicts of law.
5.3 Amendments. Any alteration, change, or modification of or to this Agreement must be in writing
and signed by authorized representatives on behalf of each of the Parties. Substantial amendments to this
Agreement may be subject to the approval of the City Council of San Luis Obispo. The City’s Community
Development Director or designee is authorized to execute amendments to this Agreement on behalf of the
City.
5.4 Counterparts. This Agreement may be executed in counterparts, each of which,
after all the Parties hereto have signed this Agreement, will be deemed to be an original, and such
counterparts will constitute one and the same instrument.
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5.5 Independent Status. As co-applicants to the Homekey Project, PSHH and the City are and shall
at all times remain independent entities. The personnel performing the Services under this Agreement on
behalf of each Party shall at all times be under their respective Party’s exclusive direction and control.
Neither Party nor any of their officers, employees, or agents shall have control over the conduct of the other
Party or any of their officers, employees, or agents, except as set forth in this Agreement. Neither Party shall
incur nor have the power to incur any debt, obligation, or liability whatsoever against the other, or bind the
other in any manner.
5.6 Confidentiality. Developer acknowledge and agree that the City is a public entity with
a responsibility and, in many cases, a legal obligation to conduct its business in a manner
open and available to the public. Accordingly, any information provided by Developer to City with respect
to the Project Site, the Project or Developer may be disclosed to the public either purposely, inadvertently,
or as a result of a public demand, request or order.
5.6 Time is of the Essence. Time is of the essence for each of Developers’ obligations under this
Agreement.
[SIGNATURES ON FOLLOWING PAGE]
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THE UNDERSIGNED AUTHORIZED REPRESENTATIVES of City of San Luis Obispo and
People’s Self-Help Housing have executed this Agreement as set forth below:
CITY OF SAN LUIS OBISPO
By: ,
Derek Johnson, City Manager
Date:
PEOPLE’S SELF-HELP HOUSING
By:
Ken Trigueiro, President and CEO
Date:
Page 246 of 346
R 11439
RESOLUTION NO. 11439 (2023 SERIES)
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS
OBISPO, CALIFORNIA, AUTHORIZING JOINT APPLICATION TO, AND
PARTICIPATION IN, THE HOMEKEY PROGRAM FOR THE CALLE
JOAQUIN HOMEKEY PROJECT
WHEREAS, the California Department of Housing and Community Development
(“Department”) has issued a Notice of Funding Availability, dated March 29 , 2023
(“NOFA”), for the Homekey Program (“Homekey” or “Program”). The Department has
issued the NOFA for Homekey grant funds pursuant to Health and Safety Code section
50675.1.3 (Assembly. Bill No. 140 (2021-2022 Reg. Sess.), § 20.); and
WHEREAS, The City of San Luis Obispo (“The City”) desires to jointly apply for
Homekey grant funds with People’s Self-Help Housing Corporation (“Co-Applicant 1”),
Calle Joaquin Homekey LLC (“Co-Applicant 2”), and Calle Joaquin LP (“Co-Applicant 3”).
Therefore, The City is joining Corporation in the submittal of an application for Homekey
funds (“Application”) to the Department for review and consideration of the Calle Joaquin
Homekey Project located at 1433 Calle Joaquin; and
WHEREAS, The Department is authorized to administer Homekey pursuant to the
Multifamily Housing Program (Chapter 6.7 (commencing with Section 50675) of Part 2 of
Division 31 of the Health and Safety Code. Homekey funding allocations are subject to
the terms and conditions of the NOFA, the Application, the Department-approved STD
213, Standard Agreement (“Standard Agreement”), and all other legal requirements of
the Homekey Program; and
WHEREAS, Housing Element policies and programs encourage and support the
construction of new affordable housing in the City; and
WHEREAS, on July 24, 2023, the Council of the City of San Luis Obispo
authorized the joint application to, and participation in, the Homekey program by adoption
of Resolution No. 11329 (2023 Series).
NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Luis
Obispo to amend Resolution No. 11439 (2023 Series) and authorize the joint application
to, and participation in, the Homekey program as follows:
SECTION 1. Recitals. The recitals set forth above are hereby adopted as
additional findings of the City in adopting the policies herein.
SECTION 2. Environmental Review. As provided by Health and Safety Code
section 50675.1. the guidelines allow for exemption of certain Round 3 Homekey Projects
from the California Environmental Quality Act (CEQA). Evaluation of potential
environmental impacts in accordance with CEQA will occur if during the application
submittal or funding award it is determined that the project is not exempt per HSC section
50675.1.4.
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SECTION 3. Findings. The City Council, after consideration of the Homekey
Program and staff recommendations, makes the following findings:
1. The City Manager or their designee is hereby authorized and directed to
submit a joint Application to the Department in response to the NOFA, and
to jointly apply for Homekey grant funds for an anticipated project cost not
to exceed $22,000,000. Per the Homekey grant provisions, it is
recommended to identify an authorized dollar amount that is at least double
the anticipated award. In line with available funding allocation for the Central
Coast Geographical Area, the total authorized amount shall not exceed
$22,000,000.
2. If the Application is approved, the City Manager or their designee is hereby
authorized and directed to enter into, execute, and deliver a Standard
Agreement in a total amount not to exceed $22,000,000, any and all other
documents required or deemed necessary or appropriate to secure the
Homekey funds from the Department and to participate in the Homekey
Program, and all amendments thereto (collectively, the “Homekey
Documents”).
3. The City acknowledges and agrees that it shall be subject to the terms and
conditions specified in the Standard Agreement, and that the NOFA and
Application will be incorporated in the Standard Agreement by reference and
made a part thereof. Any and all activities, expenditures, information, and
timelines represented in the Application are enforceable through the
Standard Agreement. Funds are to be used for the allowable expenditures
and activities identified in the Standard Agreement.
4. The City Manager of the City of San Luis Obispo, or their designee, is
authorized to execute the Application and the Homekey Documents on
behalf of the City for participation in the Homekey Program and to execute
such other documents and take such other actions consistent with the
purposes of the grant as necessary to accept and comply with grant
requirements and implement the project.
NOW, THEREFORE, BE IT FURTHER 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 $400,000 AHF award:
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:
The Calle Joaquin Homekey Project will enable an increase to the City’s
affordable housing inventory specifically for permanent supportive housing and
implements several General Plan policies regarding housing. The project will
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increase the supply of affordable housing for extremely low, very low, and low
income households with the conversion of 87 motel units to 50-75 permanent
supportive housing units and associated supportive services.
2. Need: There exists a substantial or overarching need for the type of unit to be
assisted, as follows:
Housing needs in general are growing along the coastal areas , particularly for
lower income households, which is exacerbating the Homelessness crisis. San
Luis Obispo will benefit greatly from the Calle Joaquin Homekey Project
development because it specifically provides critical permanent supportive
housing units called for in both the City’s Homelessness Response Strategic
Plan and the County of San Luis Obispo Countywide Plan to Address
Homelessness.
3. Suitability: The project to be assisted is appropriate for its location both in
terms of land use and design, as follows:
The Calle Joaquin Homekey Project is appropriately suited for this location,
both in terms of land use, adjacent bus routes, and proximity to services along
Los Osos Valley Road, Madonna Road, South Higuera and Prado Road and
will accommodate full-time on-site supportive services, management, and
oversight.
4. Timing: The project would better serve the City’s needs if it were built
immediately as opposed to later, as follows:
The Calle Joaquin Homekey Project will be permitted and motel rooms
converted and occupied within 15 months as allowed for and intended by the
state Homekey Grant program to rapidly expand the inventory of housing for
people experiencing homelessness or at risk of homelessness at the specified
location.
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:
This is a highly effective use of the City’s Affordable Housing Funds , in the
amount of $400,000, as it will leverage additional funding sources as they
demonstrate local support and commitment to the development. These funding
sources include the Homekey Grant Round 3 award for an anticipated project
cost of $21,528,657; County of San Luis Obispo funding commitment in the
amount of $2.6 million; Private Foundation funding in the amount of $800,000;
$150,000 Wells Fargo Homekey Accelerator funding; and $164,329 Defe rred
Developer Fee. Project financial feasibility is dependent upon the City’s
Affordable Housing Funds.
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6. Readiness: The project is ready to proceed, as follows:
Per Homekey Guidelines and City Zoning regulations, the proposed Calle
Joaquin Homekey Project will not require discretionary approvals. 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 the Homekey Rou nd 3 Grant award, construction
will start immediately with occupancy 15 months from award.
Upon motion of Council Member ___________, seconded by Council Member
___________, and on the following roll call vote:
AYES:
NOES:
ABSENT:
The foregoing resolution was adopted this _____ day of _______________ 2024.
___________________________
Mayor Erica A. Stewart
ATTEST:
______________________
Teresa Purrington,
City Clerk
APPROVED AS TO FORM:
______________________
J. Christine 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, on ______________________.
___________________________
Teresa Purrington,
City Clerk
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