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HomeMy WebLinkAboutR-10770 - Resolution approving affordable housing fund for Bishop Street StudiosRESOLUTION NO. 10770 (2017 SERIES) A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS OBISPO, CALIFORNIA, APPROVING AN AFFORDABLE HOUSING FUND AWARD TO THE HOUSING AUTHORITY OF SAN LUIS OBISPO AND TRANSITIONS MENTAL HEALTH ASSOCIATION FOR BISHOP STREET STUDIOS IN THE AMOUNT OF $850,000 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 February 7, 2017, for the purpose of considering multiple requests for Affordable Housing Fund (AHF) assistance; and WHEREAS, the proposed project by the Housing Authority of San Luis Obispo (HASLO) and Transitions Mental Health Association (TMHA), meet eligibility criteria established by the City Council; and WHEREAS, Housing Element policies and programs encourage and support the maintenance and rehabilitation of existing affordable housing as well as 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 presented at said meeting. NOW, THEREFORE, BE IT RESOLVED, by the Council of the City of San Luis Obispo as follows: SECTION 1. 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. The project is only an action to award funding. However, during project entitlements, a Mitigated Negative Declaration of Environmental Impact was approved for Bishop Street Studios by the City Council on November 15, 2016. SECTION 2. 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: Bishop Street Studios Project 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 very -low income households with the construction of 34 units. The proposed request is consistent with General Plan Housing Element Policies 3.1, 3.5, 3.7, 6.18, 8.1, 8.8, 8.11,8.12, and 8.20. R 10770 Resolution No. 10770 (2017 Series) Page 2 2. Need: There exists a substantial or overarching need for the type of unit to be assisted, as follows: The City of San Luis Obispo has a substantial need for affordable housing to meet goals stated in the City's General Plan Housing Element. This need is further evidenced by HASLO's long waiting lists for all of the affordable housing programs. TMHA operates housing in the City which is also at capacity, and hundreds of clients remain in need of an affordable, supported living environment similar to what Bishop Street Studios will provide. Bishop Street Studios will become a new permanent special needs housing resource for the community. 3. Suitability: The project to be assisted is appropriate for its location both in terms of land use and design, as follows: Bishop Street Studios is ideally suited for this location. It is consistent with zoning and land use designations, and close to health and transportation services for residents. The design is respectful of the site context, and will rehabilitate the currently abandoned Sunny Aces building. The project does an excellent job of renovating the existing brick building, while adding new buildings that complement the restored Sunny Acres building as the center piece of the project. Bishop Street Studios suitability received unanimous approval by the Cultural Heritage Committee and Architectural Review Commission. 4. Timing: The project would better serve the City's needs if it were built immediately as opposed to later, as follows: The timing of this application is appropriate, and crucial, for the project to move forward. HASLO will be applying for Low Income Housing Tax Credits, the key source of project financing, by the March 1 st state deadline. The state requires all local funding to be committed prior to applying for the Low -Income Housing Tax Credits. 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: The City's Affordable Housing Funds represent less than 15% of project costs, leveraging at least $6 million in other funds on Bishop Street Studios. Other sources include a HASLO Tranche B loan, Low -Income Housing Tax Credits, a private capital campaign, a SLO County Housing Trust Fund loan, County Home and CDBG funds, and City CDBG funding. 6. Readiness: The project has all necessary City approvals and is ready to proceed, as follows: Bishop Street Studios has all of the necessary City discretionary approvals and is ready to proceed with detailed construction drawings. We are working with our architecture and engineering team to prepare and submit these drawings as part of a building permit application by early June. Should a Tax Credit Award be secured, HASLO/TMHA anticipates starting construction in December 2017. This schedule is conditional upon the state awarding Low - Income Housing Tax Credits in June. R 10770 Resolution No. 10770 (2017 Series) Page 3 SECTION 3. Affordable Housing Fund Award, HASLO/TMHA (Bishop Street Studios). The City Council does hereby approve an AHF award in an amount not to exceed $850,000, 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, Deed, and Promissory Note with the City for 34 for -rent affordable housing units located at 1600 Bishop Street for a term of 55 years, which will be recorded against the title of the property. Upon motion of Council Member Christianson, seconded by Vice Mayor Rivoire, and on the following roll call vote: AYES: Council Members, Christianson, Gomez, and Pease, Vice Mayor Rivoire and Mayor Harmon NOES: None ABSENT: None The foregoing resolution was adopted this 7th day of February, 2017. a r Heid/amVii ATTEST: Carrie Gallagher City Clerk R 10770 Resolution No. 10770 (2017 Series) APPROVED AS TO FORM Page 4 IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Luis Obispo, California, this I -5`fhday of 20 Carrie Gallagher City Clerk R 10770