April 19, 2022
City Manager's Office
DATE: April 19, 2022
TO: Mayor Butt and Members of the City Council
FROM:
Shasa Curl, City Manager
Gabino Arredondo, Project Manager
Subject:
Acquisition of the Richmond Housing Authority (RHA)
Administration Building
FINANCIAL IMPACT: Sale of the RHA administration building to the City is for one dollar ($1.00). The RHA administration building is
currently being rented for the operation of the
RichmondBuild program. Once the building is transferred from RHA to the City, the City will no longer be obligated to make rental payments. In addition, according to the
City and RHA repayment agreement approved on
January 25, 2022, the debt owed by RHA will be reduced
by $307,649 once the administration building is
transferred from RHA to the City.
PREVIOUS COUNCIL
ACTION:
June 30, 2020
STATEMENT OF THE
ISSUE:
The Richmond Housing Authority (RHA) owns the
administration building at 360 S. 27th Street, Richmond, CA 94804, and leases the building to the City for purpose of operating the RichmondBUILD program. An
implementing action of RHA’s Asset Repositioning
Strategy is to transfer the building to the City. The U.S.
Department of Housing and Urban Development (HUD)
requires an approving resolution from the City.
AGENDA
REPORT
April 19, 2022
RECOMMENDED ACTION:
ADOPT a resolution approving the acquisition of the
Richmond Housing Authority (RHA) administration
building (360 S. 27th Street); and AUTHORIZE the city
manager or their designee to execute final form of
agreements and any supporting U.S. Department of
Housing and Urban Development (HUD) documents to
facilitate the transfer and sale of the RHA administration building to the City of Richmond for $1.00 – City
Manager’s Office (Shasa Curl 510-620-6512).
DISCUSSION:
Richmond Housing Authority (RHA) acquired the administration building located at 360 27th Street Richmond, CA 94804-2906 in 1957 for $12,750 from the Public Housing Administration. The administration building consists of commercial and/or non- residential uses. Since April 2009, the administration building has been used by the City’s Employment and Training Department for the purposes of administering RichmondBUILD, an environmental workforce and job training program. In response to a U.S. Department of Housing and Urban Development (HUD) audit finding, this relationship was memorialized in a lease between RHA and the City effective April 1, 2017.
The RichmondBUILD program was established in 2007, as a violence reduction strategy for the City and has since become a nationally recognized construction skills and green building training program. RichmondBUILD’s core mission is to create opportunities and address issues of equity and access to good jobs for all residents.
Program participants include at-risk and under-served youth, formerly incarcerated and re-entry individuals, immigrants, and women seeking non-traditional careers.
Over the last ten years, RichmondBUILD has expanded the training programs to include pre-apprenticeship construction skills, environmental remediation including Hazworker, OSHA, lead and asbestos certifications, and solar installation. Over 1,200 Richmond residents have been trained for careers and employment in construction, the green building industry, solar installation, and environmental remediation, and have achieved an impressive job placement rate of 85 percent of graduates. The average starting wage for a RichmondBUILD graduate is $18 an hour.
Sale of the administration building to the City is part of RHA’s asset repositioning efforts.
RHA is working to reposition its asset portfolio and close out the Public Housing program. Given its current use, the administration building is not essential to RHA’s current operations of public housing or the future operations after repositioning is completed.
Since Public Housing resources were used by RHA to purchase the administration building, approval from HUD is needed to dispose of the building. The ability to approve
April 19, 2022
the request is granted to HUD in Section 18 of the 1973 Housing Act, 24 CFR part 970 and PIH Notice 2018-04. Together these establish the application and process requirements for a disposition application.
On June 30, 2020, the RHA Board of Commissioners adopted a resolution authorizing the RHA to submit a Section 18 Disposition Application to HUD and authorized the RHA Executive Director to execute the final form of the agreements, and any supporting HUD documents to facilitate the sale of the Admin Building to the City for $1.00.
RHA has received Section 18 disposition approval and HUD is requiring the City to provide an authorizing resolution to acquire the administration building.
Since this sale will occur at less than Fair Market Value (2019 FMV is $307,650), HUD requires a use restriction that the building substantially serves people who are low- income or residents from low-income neighborhoods for 30 years.
DOCUMENTS ATTACHED:
Attachment 1 – Resolution