Fremont City Council Meeting: 06/17/25 07:00 PM
3300 Capitol Avenue Div/Dept: Human Services Department Fremont, CA 94538 Category: Agreements and Contracts
SCHEDULED
Sponsors:
COUNCIL STAFF REPORT (ID # 5470) DOC ID: 5470 F
Updated: 6/13/2025 8:37 AM by Dina Lewis F Page 1
AUTHORIZE THE CITY MANAGER TO EXECUTE AN OPERATING AGREEMENT FOR FREMONT HOUSING NAVIGATION CENTER - Authorize the City Manager to execute an Agreement to Operate the Fremont Housing Navigation Center with Bay Area Community Services (BACS)
Contact Persons:
Name: Robert Lopez Arquimides Caldera
Title: CDBG Administrator Human Services Director
Div/Dept: Human Services Department Human Services Department Phone: 510-574-2043 510-574-2056
E-Mail: [email protected] [email protected]
Executive Summary: The Fremont Housing Navigation Center (HNC) has operated since September 2020 and has assisted 279 individuals with shelter, housing, and case management services. For the past five years, the City has contracted with Bay Area Community Services (BACS) to operate the HNC, and BACS’ current agreement ends June 30, 2025.
City staff issued a Request for Information (RFI) to solicit proposals for the continued operations of the HNC and BACS was selected. Staff has identified two years of funding for HNC operations and recommends that the City Council authorize the City Manager to execute a two-year operating agreement and a two-year lease agreement with BACS with the option to extend the agreements for three additional one-year terms, subject to funding availability.
BACKGROUND: On September 10, 2019, the City Council authorized the development, construction and opening of the HNC for up to 45 residents experiencing homelessness, located at the parking lot behind City Hall. The City solicited proposals and selected BACS as the operator of the HNC and executed a three-year services agreement and a three-year lease agreement with the option to extend the agreements for two additional one-year terms.
At the time, staff identified funding from state, county and City sources to fund construction and operating costs only for the initial term of the agreement. The City source was the Affordable Housing and Homeless Services Fund. For clarification, this source is not related to the City’s affordable housing investment funds, which support the development of affordable housing projects.
The HNC opened in September 2020 during the COVID pandemic and operated at partial capacity, serving 25 residents with immediate shelter, intensive case management, and housing navigation. The HNC operated at partial capacity for two years to adhere to shelter health standards and COVID protocols until July 2022, when BACS was able to expand the program to serve the full capacity of 45 residents and continues to do so in 2025.
HNC residents are provided with interim housing services (including one meal a day), as well as intensive case management to link them to benefits, employment, and housing Council Staff Report (ID # 5470) Meeting of June 17, 2025 Updated: 6/13/2025 8:37 AM by Dina Lewis F Page 2
placements. Once housed, former residents are provided up to six months of transitional case management, including but not limited to: reviewing key elements of a rental agreement; establishing utilities or applying for low-income assistance utility programs; working with clients to ensure rents are paid on time; developing a housing crisis response plan; and planning for self-sufficiency after assistance ends.
Housing Outcomes: Through March 31, 2025, the HNC has served 279 individuals, all of whom were living in Fremont, Newark, or Union City prior to their stay at the HNC. Referrals for the program come from many sources, including the Fremont Winter Relief Program, the Human Services Department, the Police Department’s Mobile Evaluation Team (MET), the BACS Wellness Center, located off Grimmer Boulevard, BACS Outreach Team, and Abode Services street outreach teams.
Status of all HNC Resident Through 3/31/25
Status Residents
Exited from the HNC 243
Still In the Program 36
Total Served at the HNC 279
Of the 243 residents who have exited the program, 185 residents (76%) transitioned to stable housing or an appropriate program or facility:
• 145 residents started renting on their own or co-living with family or friends; and • 40 residents entered temporary supportive programs, such as transitional housing, or a substance use facility.
Status of 243 Residents Exited Through 3/31/25
Status Individuals %
Stable Permanent Housing 145 60%
Emergency Shelter/Transitional/Treatment Facility 40 16% Total Exiting to Stable/Emergency
Shelter/Transitional Housing/Treatment 185 76%
Total Exiting to Place Not Meant for Human
Habitation 58 24%
Notably, 60% of HNC residents have moved to stable housing from temporary shelter arrangements, which is well above the national average of 32.4% cited in the Department of Housing and Urban Development’s (HUD) FY 2023 National Summary of Homeless System Performance report. The HNC’s success rate is also higher than the Alameda County average of 31% cited by Alameda County Health, Housing, and Homelessness Services data for FY 2022.
Budget: The City originally estimated the first five years of HNC operating and flex fund costs to be approximately $12.8 million. After five years, HNC expenses are projected to total $8.4 million. This cost savings of $4.4 million is primarily due to Alameda County Council Staff Report (ID # 5470) Meeting of June 17, 2025 Updated: 6/13/2025 8:37 AM by Dina Lewis F Page 3
Public Health’s (ACPH) COVID-19 mandated capacity reductions. The City also successfully advocated for funding with our elected representatives and received $1.5 million in one-time State and Federal awards, which has allowed the City to save the use its own affordable housing and homeless service dollars for future years.
Currently, the HNC costs an average of $2.4 million a year to operate. Operating costs include staff specializing in housing case management, supportive service staff, meals for participants, facility costs, and overhead expenses. Since opening, the HNC has increased its spending in flexible client support (flex) funds, from $186,388 in FY 2020/21 to $286,773 in FY 2023/24. Flex funds are used to provide first and last month rental deposits, security deposits, titrated rental assistance, or move-in assistance for individuals receiving services at the HNC.
FY2020/21 – FY 2024/25 Projected HNC Operating and Flex Fund Costs: $8.4M Use Amount
Operating Expenses $7,450,248
Flex Fund Expenses $977,070
Total: $8,427,318
FY2020/21 – FY 2024/25 Projected HNC Revenue: $8.4M
Revenue Source Amount
AC SSA $1,080,000
CA HHAP $2,737,464
CA PLHA $2,254,932
CA HCD $1,000,000
Fed HUD $500,000
CoF H&H $844,435
Donations $10,487
Total: $8,427,318
The City successfully leveraged several state and county funding sources to cover 100% of the operating and flex fund costs. These funding sources include:
• Alameda County Social Service Agency Funding (AC SSA) • State Homeless Housing, Assistance and Prevention (CA HHAP) • State Permanent Local Housing Allocation (CA PLHA)
• State Housing and Community Development General Fund (CA HCD) • Federal Department of Housing and Urban Development (Fed HUD) • City of Fremont Homeless & Housing Fund (CoF H&H)
• Private Donations
DISCUSSION/ANALYSIS: The City of Fremont continues to experience a homelessness crisis. The 2024 Alameda County Point-in-Time Homeless Count showed 807 unhoused Council Staff Report (ID # 5470) Meeting of June 17, 2025 Updated: 6/13/2025 8:37 AM by Dina Lewis F Page 4
people in Fremont, of which 612 were unsheltered. On a more positive note, the 2024 PIT count does reflect the City’s ongoing efforts to mitigate homelessness, with a 21% reduction in homelessness since the 2022 count. Combined with the 76% rate of placing HNC residents in stable housing or an appropriate facility, these outcomes reflect the City’s strong partnerships with federal, state, and regional agencies and its investments in prevention, shelter, and housing programs.
The City continues to dedicate resources to mitigate and prevent homelessness through a variety of programs and partnerships with local non-profits, including the partnership with BACS to operate the HNC. The HNC is a primary component of the City’s Homelessness Plan adopted in May 2024 along with a number of shelter, prevention, and housing services. The City also partners with BACS to operate the Homeless Wellness Center on Grimmer Boulevard.
With the current five-year HNC operating and lease agreements period ending on June 30, 2025, City staff released a Request for Information (RFI) and solicited proposals to continue operating the HNC. BACS was the only agency to respond and after reviewing their application, interviewing BACS staff, and performing a walkthrough of the HNC, BACS was selected to continue operations due to their qualifications, performance, and familiarity with the City.
BACS has provided behavioral health care and housing services across the spectrum of need since 1953, with a focus on individuals with severe mental illness (SMI) and other complex challenges like homelessness, co-occurring disorders, criminal justice involvement, and/or other history of institutionalization. Today, BACS’ 700+ team members serve nearly 20,000 people each year with 65 unique programs whose services target individuals experiencing or at-risk of homelessness.
Through its consistent outreach presence in Fremont, BACS has been able to gain trust and familiarity with many of the unhoused individuals in the City. As mentioned earlier, BACS’ 60% rate of transitioning HNC residents to stable housing is significantly higher than the national average due to their preparation of residents for housing and employment and direct connections to landlords in Fremont. The HNC and the Fremont Wellness Center help allow BACS to identify the best resources and direction for an individual who may need services to prepare them for the transition to stable housing.
As the HNC operates year-round, BACS has also developed a positive supportive community environment through both professional and social events for HNC residents. Pets are welcome at the facility, which alleviates the fear of having to choose housing over abandoning their pet and ensuring that their mental wellness is being sustained.
Additionally, BACS has been a good neighbor to the City and surrounding businesses, working in cooperation with all stakeholders to address any issues that may arise.
Staff recommend that the City Council authorize the City Manager, or designee, to execute a two-year services agreement and a two-year lease agreement with BACS to operate the HNC, with the option to extend the agreements for three additional one-year terms, subject to funding availability.
FISCAL IMPACT: BACS estimates the cost of operating the HNC to be $2.5 million in FY 2025/26 and approximately $2.55 million in FY 2026/27, for a total cost of $5,050,000 Council Staff Report (ID # 5470) Meeting of June 17, 2025 Updated: 6/13/2025 8:37 AM by Dina Lewis F Page 5
over the initial two-year term of the agreement. Staff have identified sufficient funding to cover the first two years of funding:
Funding Sources for Two-Year HNC Operating Agreement
Source Amount
CoF Affordable Housing and Homeless Services $4,345,000 State Permanent Local Housing Allocation 705,000
Total: $5,050,000
This funding includes all remaining City Affordable Housing and Homeless Services fund balance. As part of the FY 2025/26 Adopted Operating Budget, the City Council appropriated $2.5 million for operating costs, including $1.72 million from the HNC account of the Affordable Housing and Homeless Services Fund (Fund 112) and $781,000 from the CAHCD PLHA account of the Miscellaneous Operating Grants Fund (Fund 190). This report also recommends the City enter into a two-year lease agreement at $1.00 per year with three optional years at the same rate.
Staff will continue to seek additional funding for years three through five of the proposed agreement. The long-term funding environment for homelessness services is uncertain as federal homelessness funding has been targeted for cuts or elimination. Future allocations of state HHAP funds to address homelessness are also uncertain. Additionally, state PLHA funds for housing related services and projects depend on real estate transaction fees and may produce lower revenues considering the cooling real estate market.
ENVIRONMENTAL REVIEW: The proposed action is exempt from the requirements of California Environmental Quality Act (CEQA) because, without limitation, it is not a “project” under CEQA Guidelines Section 15378(b)(2), (4) and/or (5) and/or because it can be seen with certainty that there is no possibility that the activity may have a significant effect on the environment per CEQA Guidelines Sections 15061(b)(3) and 15061(b)(3), each of the foregoing providing a separate and independent basis for CEQA exemption.
ATTACHMENTS: None.
RECOMMENDATION: Authorize the City Manager, or designee, to execute a two-year services agreement with Bay Area Community Services to operate the Fremont Housing Navigation Center in an amount not-to-exceed $5,050,000, with the option to extend the agreement for three additional one-year terms; and a concurrent two-year lease agreement at $1 per year with the option to extend the lease agreement for three additional one-year terms, subject to funding availability.