City of Gonzales
COMMUNITY DEVELOPMENT DEPARTMENT
ACTIVITY REPORT
TO: Honorable Mayor Rios and City Council
DATE: November 4, 2024
FROM: Taven Kinison Brown, Community Development Director THROUGH: Carmen Gil, City Manager
SUBJECT: CHISPA Update on the Alta Street Property
RECOMMENDATION
Receive a presentation and report from Geoffrey Morgan, President/CEO of CHISPA, Inc. and provide direction on potential options for the site.
BACKGROUND
In Resolution 2022-58, the City Council directed that the City Manager develop an agreement with a nonprofit housing developer for the purchase and sale of the 498 Alta Street property for the purpose of developing a senior housing project. The resolution stated that, “If acquired by the buyer, the buyer intends to develop the Property into a housing project consisting of multiple units, all of which will be rented to households where members are at least fifty-five (55) years of age or older (“Senior Households”).”
While the property has not yet been acquired by the potential buyer, CHISPA, the housing project is to take shape in one of two ways (development options):
(i) A multifamily housing project which would utilize federal low income housing tax credits and contain at least thirty-six (36) units, one hundred percent (100%) of such units (excluding one manager’s unit) will be restricted for occupancy by Senior Households, and at least forty percent (40%) of which would be rented to Senior Households earning no more than eighty percent (80%) of the area median income for Monterey County, California. --or--
AGENDA
ITEM
11 (ii) Fifteen (15) single family rental homes which would not utilize any federal low income housing tax credits, forty percent (40%) of which would be rented to Senior Households earning no more than eighty percent (80%) of the area median income for Monterey County, California, and the balance of which would be rented to Senior Households earning no more than one hundred twenty percent (120%) of the area median income for Monterey County, California.
REVIEW AND ANALYSIS
CHISPA has found that the 36-unit option is too expensive and would take approximately 7.5 years to realize. In addition, to the two years that have already passed since Council Resolution 2022-58. CHISPA has stated that they cannot pursue this path as it is not feasible for them at the moment.
Mr. Morgan would like to present an approach to providing the 15-unit scenario, shifting from the initial focus on seniors as it seems to be more feasible and timely for them. Through a partnership with another party (potentially agricultural business or Gonzales Unified School District), CHISPA may be more inclined to develop domestic farmworker / workforce housing that can be made available at an affordable rate.
If the City Council supports the new concept for the Alta property, CHISPA will seek (with City support) an equity partnership with a local agricultural business or the Gonzales Unified School District, to realize a 15-unit scenario potentially using the City’s preapproved ADU plans, shifting from the original intent of building exclusively senior housing on the site.
Explain the Recommendation and How it Supports the Vision Gonzales will continue to be a safe, clean, family-friendly community, diverse in its heritage, and committed to working collaboratively to preserve and retain its small-town charm.
Explain: The City continues to nurture and build upon collaboration efforts with affordable housing interests to further provide affordable housing in the City of Gonzales.
Explain how the Recommendation Directly Implements the Mission The City Council and Staff of the City of Gonzales will realize our Vision by providing the leadership, commitment, and resources necessary to provide excellent services that enhance the quality of life of our diverse community.
Explain: The City of Gonzales directly exercised its leadership and financial resources to facilitate the purchase and acquisition of the Alta property for the purposes of constructing new housing to allow current residents and local workers to live affordably and remain in the community, thereby enhancing their quality of life.
City services will be delivered in a cost-effective, respectful, and friendly manner to ensure the safety and well-being of the residents and the promotion of business, recreational, housing and employment opportunities in an environmentally sustainable manner.
Explain: Please see the Vision and Mission explanations above.
Strong fiscal policies allow us to provide appropriate infrastructure for:
• Public Safety Yes No X N/A
• Housing X Yes No N/A
• Recreation Yes No X N/A
• Environment Yes No X N/A
• Education Yes No X N/A
Explain: Please see the Vision and Mission explanations above.
ALTERNATIVES
• The Council could express their desire for the larger 36-unit project scenario yet realize that such a project is not tenable to CHISPA for the expense and extended 7.5 year timeframe. • The City Council could direct staff to pursue another approach to housing on the City-owned Alta property.
BUDGET IMPACT
In the 15-unit scenario, the City would receive $50,000 upon transfer of the property to the affordable housing builder, CHISPA. In the 36-unit scenario, the City would receive $400,000 upon transfer of the property to the affordable housing builder. Yet the 36-unit scenario is not tenable to CHISPA.
The City of Gonzales previously purchased the property for a negotiated price of $600,000.00 and found the purchase price justifiable and appropriate for the purposes of partnering with a non-profit housing developer to develop a senior housing project.
CONCLUSION
Receive a presentation and report from Geoffrey Morgan, President/CEO of CHISPA, Inc. and provide direction on potential options for the site.
Attachments:
1. Powerpoint presentation