Fremont City Council Meeting: 06/16/26 07:00 PM
3300 Capitol Avenue Div/Dept: Housing
Fremont, CA 94538 Category: Affordable Housing
SCHEDULED
Sponsors:
COUNCIL STAFF REPORT (ID # 5626) DOC ID: 5626
Updated: 6/11/2026 7:06 PM by Alberto Quintanilla Page 1 Bond Issuance for 39340 Fremont Blvd. LP. - Public Hearing (Published Notice) in Accordance with the Tax Equity and Fiscal Responsibility Act (TEFRA) to Consider the issuance of Tax-Exempt Bonds by California Municipal Finance Authority (CMFA) for 39340 Fremont Blvd, LP. (Canvas Apartments) and Making Findings of CEQA Exemption
Contact Persons:
Name: Lucia Hughes David Persselin
Title: Housing Manager Finance Director
Div/Dept: Housing Finance Department
Phone: 510-494-4506 510-494-4631
E-Mail: [email protected] [email protected]
Executive Summary: The California Municipal Finance Authority (CMFA), a joint exercise of powers authority of which the City of Fremont is a member, has been asked by Community Development Partners (CDP) to serve as the conduit issuer of tax-exempt bonds for the Canvas Apartments affordable housing project (the “Project”) in the City of Fremont. CMFA may not approve the bond financing unless and until the City Council approves the bond issuance after conducting a public hearing (referred to as a “TEFRA hearing”).
The federal Tax Equity and Fiscal Responsibility Act of 1982 (TEFRA) mandates a public accountability procedure involving the legislative body of a local agency in which a proposed project to be funded with tax-exempt bonds is located. The TEFRA hearing is a public inquiry required by the Internal Revenue Service intended to provide members of the community with an opportunity to speak on behalf of or against the proposed project.
Once the TEFRA hearing has been conducted, the City Council is asked to adopt a resolution approving the issuance of tax-exempt bonds for the project.
The bonds will be issued as limited obligations of CMFA, and the City will have no liability with respect to the bonds or any role to play in the bond issuance other than the TEFRA hearing.
Staff recommends that the City Council conduct a public hearing in accordance with the Tax Equity and Fiscal Responsibility Act and adopt a resolution approving the issuance of tax-exempt bonds for the Project.
Council Staff Report (ID # 5626) Meeting of June 16, 2026 Updated: 6/11/2026 7:06 PM by Alberto Quintanilla Page 2 Background: CMFA has been asked by 39340 Fremont Blvd LP (the “Borrower”) to serve as the conduit issuer of tax-exempt revenue bonds in an aggregate principal amount not to exceed $20,000,000 (together with a like amount of refunding bonds) (the “Bonds”) for the Project in the City of Fremont. CMFA may not approve the bond financing unless and until the City Council approves the bond issuance after conducting a TEFRA hearing. The proceeds of the Bonds will be used to finance and refinance the acquisition, construction, development and equipping of a 92-unit affordable rental project to be owned and operated by the Borrower and located at 39340 Fremont Boulevard, Fremont.
Discussion/Analysis: Community Development Partners (CDP) is a privately-owned real estate development organization specializing in the development of affordable housing. Founded in 2011, and headquartered in Newport Beach, California and Portland, Oregon, CDP has developed over 4,800 units in five western states, including California, Oregon, Nevada, Arizona and Colorado. Canvas Apartments will be their first development in Fremont.
Canvas Apartments is a new construction project to be located at 39340 Fremont Boulevard. It consists of one five-story building with 92 residential units, with community space and common areas. The project will offer studios, 1-, 2-, and 3- bedroom apartments for people who earn 30%, 50%, 60%, and 70% of the Area Median Income (AMI).
Affordability: As detailed below, all rents will be reduced to an affordable level for extremely low, very-low, and low-income residents. The project is 100% affordable, with a mix of studios, 1-, 2- and 3-Bedroom apartments, and restricted rents for a 55-year term.
• 11% (10 Units) restricted to households earning 30% or less of AMI • 12% (11 Units) restricted to households earning 50% or less of AMI • 33% (30 Units) restricted to households earning 60% or less of AMI • 43% (40 Units) restricted to households earning 70% or less of AMI • 1 on-site manager’s unit
TEFRA Hearing: TEFRA mandates a public accountability procedure involving the legislative body of a local agency in which a proposed project to be funded with tax-exempt bonds is located. The TEFRA hearing is intended to provide members of the community with an opportunity to speak on behalf of or against the proposed project. Notice of the public hearing Council Staff Report (ID # 5626) Meeting of June 16, 2026 Updated: 6/11/2026 7:06 PM by Alberto Quintanilla Page 3 must be published in a newspaper of general circulation at least seven days prior to the date on which it is scheduled. To comply with federal tax laws, as well as with CMFA policy, once the TEFRA hearing is conducted, the City Council is asked to adopt a resolution approving the issuance of tax-exempt bonds for the project.
Project Financing: The costs of the project total approximately $57.8 Million. A large part of the project cost is proposed to be financed through multi-family housing revenue bonds issued by CMFA, with Low Income Housing Tax Credits as another principal funding source. On March 19, 2024, the City Council approved a loan of $10,000,000 for property acquisition from the Affordable Housing Development Fund (Fund 196). On June 9, 2026, the Fremont City Council approved an additional loan amount of $1,000,000 for construction, for a total loan of $11,000,000. Other funds will be from General Partner and Equity. A summary of the estimated sources and uses of funds for the project is presented in the following table.
Sources of Funds: Uses of Funds:
Tax-Exempt Bonds: $14,400,000 Land Acquisition: $4,698,814 Taxable Bond Proceeds: $17,905,445 New Construction: $31,306,000 City of Fremont: $11,000,000 Arch & Eng: $2,326,337
Deferred Costs and Fees: $9,721,310 Legal & Professional: $446,500 State Funding: $1,500,000 Finance Costs & Int: $5,069,429 LIH Tax Credit Equity: $3,310,354 Reserves: $1,018,233 Permits & Imp Fees: $4,165,554
Developer Fee: $6,165,153
Other Soft Costs: $2,641,089
Total Sources: $57,837,109 Total Uses: $57,837,109
Fiscal Impact: The Bonds to be issued by CMFA for the Project will be the sole responsibility of the Borrower, and the City will have no financial, legal, moral obligation, liability or responsibility for the Project or the repayment of the Bonds for the financing of the Project. All financing documents with respect to the issuance of the Bonds will contain clear disclaimers that the Bonds are not obligations of the City or the State of California but are to be paid for solely from funds provided by the Borrower.
The Board of Directors of the California Foundation for Stronger Communities, a California non-profit public benefit corporation (the “Foundation”), acts as the Board of Directors for the CMFA. Through its Council Staff Report (ID # 5626) Meeting of June 16, 2026 Updated: 6/11/2026 7:06 PM by Alberto Quintanilla Page 4 conduit issuance activities, the CMFA shares a portion of the issuance fees it receives with its member communities and donates a portion of these issuance fees to the Foundation for the support of local charities. With respect to the City of Fremont, it is expected that a portion of the issuance fee attributable to the City will be granted by CMFA to the General Fund of the City. Such grant may be used for any lawful purpose of the City. The Borrower will be the beneficiary of the CMFA’s charitable donation through a 25% reduction in issuance fees.
Environmental Review: The Canvas affordable housing development project satisfied the eligibility requirements to qualify for processing under Government Code section 65583.2(c), commonly known as Assembly Bill (AB) 1397. Accordingly, pursuant to AB 1397, the project was subject to ministerial review and then approved on December 4, 2025. The project was found to be exempt from the California Environmental Quality Act (CEQA) pursuant to, without limitation, CEQA Guidelines Sections 15268 and 15369 (ministerial project) and was classified as "not a project" under CEQA.
Additional environmental review under CEQA is not applicable pursuant to CEQA Guidelines Section 15061(b)(3) (Review for Exemption) and/or 15378(b)(2), (4) and/or (5), as the proposed activity to adopt a resolution to approve the issuance of bonds is covered by the commonsense exemption that CEQA applies only to projects which have the potential for causing a significant effect on the environment.
ATTACHMENTS:
• Formatted Resolution-Canvas Final
Recommendation:
1. Hold a public hearing in accordance with the Tax Equity and Fiscal Responsibility Act of 1982 (TEFRA); and,
2. Adopt a Resolution approving the issuance of Multifamily Housing Revenue Bonds by the California Municipal Finance Authority for the purpose of financing an affordable housing project in the City of Fremont to be developed by 39340 Fremont Blvd LP.