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March 17, 2026
ITEM TITLE
Housing Funds: Amendment of Loan Commitments for a Permanent Supportive Housing Development to be Located at 610 Paseo Del Rey
Report Number: 26-0054
Location: 610 Paseo Del Rey
Department: Housing and Homeless Services
G.C. § 84308 Regulations Apply: Yes
Environmental Notice : The activity is not a "Project" as defined under Section 15378 of the California Environmental Quality Act ( “CEQA”) State Guidelines. Therefore, pursuant to State Guidelines Section 15060(c)(3), no environmental review is required at this time. Notwithstanding the foregoing, the activity qualifies for an exemption pursuant to Section 15061(b)(3) of the California Environmental Quality Act State Guidelines.
Under the National Environmental Policy Act (“NEPA”), Federal funds constitute a portion of the funding for the proposed Permanent Supportive Housing Development. The Certifying Officer of the Responsible Entity (as such ca pitalized terms are defined in 24 CFR Part 58 of NEPA) has determined that all environmental requirements of NEPA have been fulfilled and a release of funds under NEPA has been delivered by the United States Department of Housing and Urban Development (“HUD”).
Recommended Action
Adopt resolutions amending loan commitments to a 96-unit affordable housing project to be located at 610 Paseo Del Rey, to extend the deadline to March 17, 2028, for assembling all financing and preparing to begin construction, as follows: A) City Council authorizes extension for $3,300,000 in HOME Investment Partnership Program; and B) Housing Authority authorizes extension for $700,000 in Low and Moderate Income Housing Asset Fund.
SUMMARY
On June 11, 2024, City Council Resolution No. 2024 -119 and Housing Authority Resolution No. 2024 -005 were adopted, committing a total of $4 Million in HOME Investment Partnership Program ( “HOME”) funds and Low and Moderate Income Housing Asset Fund ( “Low-Mod”) funds to an affordable hous ing P a g e | 2
development to be located at 610 Paseo Del Rey (the “Project”). The resolutions include language stating that the commitment expires two years from the date of adoption (i.e., June 11, 2026) if the Project has not secured all other necessary financing commitments and is prepared to commence construction. The proposed resolutions woul d extend the deadlines for assembling financing and start of construction by March 17, 2028.
ENVIRONMENTAL REVIEW
The proposed activity has been reviewed for compliance with CEQA, and it has been determined that the activity is not a “Project” as defined under Section 15378 of the State CEQA Guidelines because it will not result in a physical change in the environment. Therefore, pursuant to Section 15060(c)(3) of the State CEQA Guidelines, the activity is not subject to CEQA. This determination is also predicated on Section 15004 of the State CEQA Guidelines, which provides direction to lead agencies on the appropriate timing for environmental review. This action also does not constitute approval of a project. The proposed action is approval of a loan for construction of the affordable housing project, but such loan is contingent upon subsequent completion of the environmental review in accordance with CEQA Section 15004, to the extent necessary. This action will not foreclose review of alternatives or mitigation measures by the public as part of the CEQA process. Notwithstanding the foregoing, the activity qualifies for an exemption pursuant to Section 15061(b)(3) of the State CEQA Guidelines.
Under NEPA, Federal funds constitute a portion of the proposed loan for construction of the affordable housing project. The Certifying Officer of the Responsible Entity (as such capitalized terms are defined in 24 CFR Part 58 of NEPA) has determined that all environmental requirements of NEPA have been fulfilled and a release of funds under NEPA has been delivered by HUD.
BOARD/COMMISSION/COMMITTEE RECOMMENDATION
The Housing and Homeless Advisory Commission provided an advisory recommendation for the initial approval and will be updated on the Project at their next meeting.
DISCUSSION
Background
In March 2024, the City of Chula Vista (“City”) issued a Request for Proposals (“RFP”) for the development and operation of Permanent Supportive Housing (“PSH”), which combines long-term affordable housing with supportive services and other resources for formerly homeless individuals and families. Wakeland Housing and Development Corporation (“Wakeland”) submitted a development proposal on behalf of a project to be located at 610 Paseo Del Rey (the “Project”). Council approved a total of $4,000,000 in funding to the Project, consisting of $3,300,000 in funds from the HOME Investment Partnership Program (“HOME”) allocated to the City by HUD, and $700,000 from the Low and Moderate Income Housing Asset (“Low-Mod”) Fund, a fund controlled by the Chula Vista Housing Authority (“Housing Authority”) in its capacity as Housing Successor to the Redevelopment Agency of the City of Chula Vista.
The Project is a 96-unit development consisting of 95 affordable units and one manager’s unit. The affordable units will be restricted to households at a range of incomes, from at or below 30% of Area Median Income P a g e | 3
(“AMI”) to at or below 60% of AMI. Forty-eight (48) units will be designated as PSH for homeless individuals or families, including 25 units for homeless veterans, with the remaining 47 units reserved for low -income families. To the extent allowed by other funders, the units will be leased in accordance with the City’s policy for Chula Vista residents and workers, as codified by Chula Vista Municipal Code Chapter 19.94. In connection with the PSH units, San Diego County’s Department of Housing and Community Development Services awarded 48 Project-Based Vouchers and $8,045,073 in construction funds to the Project. These funds were awarded prior to the City and Housing Authority’s funding commitments.
The City’s HOME funds are subject to HUD regulations. To meet HOME deadlines for the disbursement of HOME funds held by the City, on September 10, 2024, City Council adopt ed Resolution No. 2024 -180 authorizing disbursement of up to $500,000 of the $3,300,000 HOME commitment as a pre -development loan. The remaining HOME and Low -Mod funds may not be disbursed until the Project closes on all its financing and is prepared to begin construction. The original funding resolutions set a deadline for reaching this milestone of two years from the date of adoption, i.e., June 11, 2026. At the time, this deadline was not a concern because both City and Wakeland staff expected the Project to move into construction quickly.
Extension of Deadline
Since being awarded a commitment of City and Housing Authority funds, the Project has taken numerous steps to move forward:
In July 2025, Wakeland applied for an allocation of Low Income Housing Tax Credits (“LIHTC”) from the California Tax Credit Allocation Committee (“CTCAC”). The LIHTC program is the primary funding mechanism for affordable housing nationally and is typically the final public funding commitment before construction starts. The Project did not score competitively enough to receive an award at that time.
Since not being awarded LIHTC funds , Wakeland modified the Project’s design to be more cost - efficient, to reduce its funding gap and make its proposal more competitive for future funding rounds.
Wakeland is preparing to re -apply for an allocation of LIHTC funds in spring 2026. Changes to the Project have made it more competitive, and changes to the LIHTC program have made awards more likely.
In December 2025, Wakeland submitted its building permit application to the City for the Project.
This process typically requires at least two or three rounds of reviews and corrections before being approved and typically takes at least six months.
Wakeland has continued to meet regularly with the City’s Housing and Homeless Services Department to discuss the Project and next steps.
With the City and County funding commitments in place , the Project is still well -positioned to complete its financing and begin construction in late 2026 or early 2027. Staff’s recommendation of a two-year extension should provide an adequate window for Wakeland to reach these milestones.
DECISION-MAKER CONFLICT
Staff has reviewed the property holdings of the City Council and Housing Authority members and has found no property holdings within 1,000 feet of the boundaries of the property which is the subject of this action.
Consequently, this item does not present a disqualifying real property-related financial conflict of interest P a g e | 4
under California Code of Regulations Title 2, section 18702.2(a)(7) or (8), for purposes of the Political Reform Act (Cal. Gov’t Code §87100, et seq.).
Staff is not independently aware, a nd has not been informed by any City Council or Housing Authority member, of any other fact that may constitute a basis for a decision-maker conflict of interest in this matter.
CURRENT-YEAR FISCAL IMPACT
There is no new fiscal impact from the proposed resolution. Funds have already been appropriated for this Project through previous resolutions. All funds for this Project are restricted funds that must be dedicated to the creation or improvement of affordable housing ; there is no General Fund expense associated with this action.
ONGOING FISCAL IMPACT
There is no additional fiscal impact from the proposed resolution. Funds have already been appropriated for this Project through previous resolutions. All funds for this Pro ject are restricted funds that must be dedicated to the creation or improvement of affordable housing ; there is no ongoing General Fund expense associated with this action.
ATTACHMENTS
None.
Staff Contact: Stacey Kurz, Director of Housing and Homeless Services Brian Warwick, Housing Manager