City of Sacramento
City Council - 2PM Report
915 I Street Sacramento, CA 95814
www.cityofsacramento.org
File ID: 2023-00373 5/9/2023 Discussion Item 5.
City Council/Housing Authority - Approval of Application for Homekey Funds from the State Department of Housing and Community Development and Conditional Loan and Grant Commitment with HOPE Cooperative for the Rodeway Inn Project File ID: 2023-00373
Location: 25 Howe Avenue, District 6, Represented by Vice Mayor Guerra Recommendation: Adopt: 1) a Housing Authority Resolution: a) authorizing the submittal of a co- application, along with 25 Howe Avenue LLC (HOPE Cooperative) or related entity (Developer), to the California Department of Housing and Community Development (HCD) in the amount of approximately $20,386,000 in Homekey Program (Homekey) funds for the Rodeway Inn Project (Project); b) authorizing the execution of a Standard Agreement for such funding and execute any documents necessary to participate in the Homekey Program, and any amendments thereto; c) amending the Housing Authority budget to receive and expend the Homekey funds for the acquisition and construction of a motel conversion to permanent supportive housing for formerly homeless families/individuals, and 2) a City Council Resolution: a) approving a $5,236,000 Conditional Loan and Grant Commitment which includes $2,013,000 in Homeless Housing, Assistance, and Prevention 4 (HHAP4) funds (Commitment) with the Developer for the construction and permanent financing of the Project; b) authorizing the Sacramento Housing and Redevelopment Agency (SHRA) to enter into, execute, and amend the Commitment, and funding agreement; c) authorizing the SHRA and the City Manager to negotiate and execute a HHAP4 funding agreement and related documents for the financing of the Project consistent with the purposes of the HHAP4 funding agreement with the State of California; d) authorizing SHRA to execute other documents and perform other actions including without limitation, negotiation, subordination, regulatory agreement, financial restructuring, and extensions; e) approving the SHRA budget amendment; and f) making related findings.
Contact: Christine Weichert, Director of Development Finance, (916) 440-1353, [email protected], Sacramento Housing and Redevelopment Agency
Presenter: Christine Weichert, Director of Development Finance, (916) 440-1353, [email protected], Sacramento Housing and Redevelopment Agency Attachments:
1-Description/Analysis
2-Vicinity Map
3-Picture of Project
4-Residential Project Summary
5-Cash Flow Proforma
6-Maximum Income and Rent Limits
File ID: 2023-00373 5/9/2023 Discussion Item 5.
7-Housing Authority Resolution - Homekey Funds
8-Council Resolution - Loan Commitment
9-Exhibit A Loan Commitment
Additional Description/Analysis
Issue Detail: In March of 2023, the State of California Department of Housing and Community Development (HCD) announced that it was once again making funding available through a Notice of Funding Availability (NOFA) for the Homekey Program. The Homekey Program funds cities, counties, and other local entities, including housing authorities, to convert motels, hotels, and other non- residential structures into permanent supportive housing and/or transitional housing for the State’s homeless population.
Subject to approval by the City Council and Housing Authority, the Housing Authority and 25 Howe Avenue LLC (HOPE Cooperative) or related entity (Developer), plan to submit an application for Homekey Funds for the Rodeway Inn Project (Project) and to enter into a loan and grant commitment and funding agreements for the construction and permanent financing of the Project. In the event the Project is awarded Homekey funds, the Developer will acquire the property and begin the rehabilitation shortly thereafter.
Project Description
: The Housing Authority is proposing a co-application with the Developer that seeks funding to acquire 25 Howe Avenue (currently the Rodeway Inn) in Sacramento and undertake the rehabilitation necessary for the hotel rooms to serve as permanent housing for homeless families and individuals. The motel was built in 1990 on 1.6 acres. A Vicinity Map and Project photo are included as Attachments 1 and 2.
The Rodeway Inn Project will rehabilitate the three-story building containing 101 motel rooms into 69 studio apartment units and a one-bedroom manager’s unit. Eighteen of the existing rooms will be converted into a studio apartment. Fifty-two studio apartments will be made larger by converting and combining 78 of the existing rooms. Kitchenettes will be added to all units. Seven of the existing rooms will be used to create offices and other meeting areas. The building is double-sided with exterior access rooms in an L shape overlooking a courtyard and protruding elevator on the west side facing Howe Avenue. Site improvements will include enhanced perimeter fencing and converting parking areas to landscaping, pet areas, community room and kitchen, and gathering areas.
Project-Based Vouchers:
The Developer applied to the Housing Authority in 2023 for Project-Based Vouchers (PBV) to serve homeless families and individuals at the Rodeway Project.
Project Developer: The Developer of the Project is HOPE Cooperative (HOPE) (also known as Transitional Living and Community Support). HOPE is a non-profit agency that has been serving Sacramento and Yolo Counties since 1981. HOPE provides homeless outreach, permanent supportive housing, interim housing, and a variety of behavioral health services including case management programs for people who are homeless or at risk for homelessness. HOPE has partnered on seven affordable developments in Sacramento and is in the process of completing three additional affordable/special needs housing developments in partnership with other developers.
File ID: 2023-00373 5/9/2023 Discussion Item 5.
Property Management:
The John Stewart Company (JSCo) will serve as property manager. JSCo manages properties throughout the state of California and directly manages 3595 affordable and market-rate housing units in the Sacramento region.
Resident and Supportive Services:
HOPE Cooperative will provide resident services at the site. HOPE employs more than 275 full-time staff and serves over 10,000 clients annually in their housing, residential, case management and crisis services programs and has over 40 years of case management experience in Sacramento.
Services to be provided include personal goal planning, living skills training, money management, and information and referrals for a variety of services and supports in the community (e.g. educational, vocational, employment, mental health, substance abuse, personal recovery services).
HOPE utilizes a whole-person care approach that addresses the client’s clinical and non-clinical needs and incorporates a collaborative and interdisciplinary approach to providing intensive and comprehensive care management services. Fifteen (15) hours a week of services will be provided and a total of 4 case managers will be located on-site.
There will be 30 units restricted to Mental Health Services Act (MHSA) funding program clients. Case management and supportive services will be provided directly by the County Department of Human Assistance (DHS). HOPE Cooperative is providing case managers to serve the non-MHSA assisted residents as described above. The final Resident Services Plan is subject to SHRA approval prior to close of escrow.
Security Plan:
There will be 24-hour desk coverage, and installation of a security camera system at vehicular driveways, all points of access, stairways and common areas will be included.
Project Financing
: The financing structure of this Project includes HCD Homekey funds, HHAP4, and MHSA funds. HHAP4 funds were committed to the project by the City Council on February 7, 2023.
MHSA funds for the Project, which are administered by SHRA but under the authority of the County of Sacramento, are scheduled to be approved by the County Board of Supervisors on May 9, 2023.
A summary of financing is provided in the following table:
SHRA/City Funding Programs Amount
Construction and Permanent Financing Loans and Grants
HHAP4 (Grant) $ 3,223,000
MHSA (Loan) $ 2,013,000
Total SHRA Funding $ 5,236,000
File ID: 2023-00373 5/9/2023 Discussion Item 5.
Funding sources, uses, and cash flow proforma for the Project are included in Attachments 4 and 5.
Proposed funding sources and their affordability requirements are summarized in the table below.
See Attachment 6 for maximum income and rent levels.
Unit Type Units % Of
Units
Affordability Restriction
Studio 69 99% 30% of Area Median Income
(AMI) or below
Manager Unit (one bedroom) 1 1%
Total 100%
Policy Considerations: The recommended actions for the Projects are consistent with: a) SHRA’s Multifamily Lending and Mortgage Revenue Bond Policies adopted by the Council in 2019, Subsection 1.1.(2)(i), new construction of permanent supportive housing and homeless housing and Subsection 1.1(2)(iii), Workforce housing (30% AMI to 60% AMI); and b) the 2021-2029 Housing Element, Goals H-2.1 Provide Opportunities for Affordable Housing Throughout the City and H- 2.2 Maximize Use of Public Properties for Affordable Housing and Shelters.
Economic Impacts: This multifamily residential Project is expected to create 307 total jobs (174 direct jobs and 133 jobs through indirect and induced activities) and create $25,622,000 in total economic output ($15,618,205 of direct output and another $10,003,794 of output through indirect and induced activities). The indicated economic impacts are estimates calculated using a calculation tool developed by the Center for Strategic Economic Research (CSER). CSER utilized the IMPLAN input- output model (2009 coefficients) to quantify the economic impacts of a hypothetical $1 million of spending in various construction categories within the City of Sacramento in an average one-year period. Actual impacts could differ significantly from the estimates and neither the City of Sacramento nor CSER shall be held responsible for consequences resulting from such differences.
Environmental Considerations: California Environmental Quality Act (CEQA): Activities authorized in this report have been analyzed in accordance with CEQA and are determined to be exempt from CEQA pursuant to Health & Safety Code, Section 50675.1.2 - Project Homekey.
National Environmental Policy Act (NEPA): An Environmental Assessment (EA) is being prepared in order to analyze the Project in accordance with NEPA and it is anticipated that the project will be determined to not result in a significant impact on the environment. The evaluation will be completed prior to making any choice limiting action.
Sustainability: The Project has been reviewed for consistency with the goals, policies, and targets of
File ID: 2023-00373 5/9/2023 Discussion Item 5.
the 2035 General Plan. If approved, the project will advance the following goals, policies, and targets that will directly or indirectly conserve energy resources and reduce greenhouse gas emissions, in part, from the 2035 General Plan: a) Housing Element - Strategies and Policies for Conserving Energy Resources - Climate Action Plan, subsection 7.2: improving the energy efficiency in new buildings; and b) Environmental Resources - Air Quality and Climate Change sub-section 6.1.7:
reduce greenhouse gas emissions from new development, promoting water conservation and recycling, promoting development that is compact, mixed-use, pedestrian friendly, and transit oriented; and promoting energy-efficient building design and site planning.
Commission/Committee Action: Sacramento Housing and Redevelopment Commission: At its meeting of May 3, 2023 it is anticipated that the Sacramento Housing and Redevelopment Commission will recommend approval of the attached resolutions. In the event it fails to do so, Staff will advise the Council at the meeting.
Rationale for Recommendation: The actions recommended in this report enable SHRA to continue to fulfill its mission of providing a range of affordable housing opportunities in the City and are consistent with the City’s 2021 Comprehensive Siting Plan to Address Homelessness, SHRA’s previously approved Multifamily Lending and Mortgage Revenue Bond Policies, the City of Sacramento’s 2021-2029 Housing Element as part of Sacramento’s 2035 General Plan, Promise Zone and the Opportunity Zone.
Financial Considerations: The proposed financing includes $20,386,000 in HCD Homekey funds and $3,223,000 in City HHAP4 funds. The Homekey fund application is included in the Housing Authority resolution. City HHAP4 funds were previously committed to the Project by the City Council on February 7, 2023, and will be a grant to the Project. MHSA funds are being requested from the Sacramento County Board of Supervisors in the amount of $2,013,000 in as a loan to the Project and are the subject of a separate item being considered for approval from the County on May 9, 2023.
The SHRA loan will have a zero percent interest rate and a 40-year term. SHRA will collect an annual payment of 0.125 percent (12.5 basis points) of the total SHRA funding amount and a fee equal to $100 per each SHRA-funded unit per year for monitoring the regulatory restrictions and administration of the funds. The monitoring fee shall not exceed $15,000 annually.
Local Business Enterprise (LBE): M/WBE & Section 3 Considerations :
Minority and Women’s Business Enterprise requirements and Section 3 considerations will be applied to all activities to the extent required by the federal funding.
Attachment 3
Arden Star Area Median Square Total Gross Utility Net Net Rent per Total Monthly Current Unit Type Income % (AMI) Number Feet Sq Feet Rent¹ Allowance Rent Sq Foot Net Rent Annual Rent Studio (PBV) 30% 69 340 23,460 532$ -$ 532$ 1.56$ 36,708$ 440,496$ Studio (Exempt Manager) 1 450 450 -$ -$ -$ -$ Totals 70 36,708$ 440,496$
¹Pursuant to 24CFR 983.301, contract rents approved by HUD may exceed the tax-credit rent limits; and the AMI change is due to income averaging regulation by CDLAC. The tenant rent will not exceed 30% of the household adjusted gross income with PBV.
Annual 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2039 2044 Income Increase Per Unit Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Year 15 Year 20 Gross Potential Rent 2.50% 462,796 474,366 486,225 498,381 510,840 523,611 536,702 550,119 563,872 577,969 653,919 739,849 Rental Subsidy 2.50% 759,177 778,156 797,610 817,551 837,989 858,939 880,413 902,423 924,983 948,108 1,072,697 1,213,658 Less Vacancy 5.00% (61,099) (62,626) (64,192) (65,797) (67,441) (69,128) (70,856) (72,627) (74,443) (76,304) (86,331) (97,675) Effective Gross Income $1,160,874 $1,189,896 $1,219,644 $1,250,135 $1,281,388 $1,313,423 $1,346,258 $1,379,915 $1,414,413 $1,449,773 $1,640,285 $1,855,832 Operating Expenses
Operating Expenses 3.50% 8,067 604,938 626,111 648,025 670,705 694,180 718,476 743,623 769,650 796,588 824,468 979,210 1,162,994 Property Management 3.50% 840 62,988 65,193 67,474 69,836 72,280 74,810 77,428 80,138 82,943 85,846 101,958 121,095 Resident Services 3.50% 3,579 268,342 277,734 287,455 297,515 307,928 318,706 329,861 341,406 353,355 365,722 434,364 515,888 Taxes 2.00% 1,000 72,828 74,285 75,770 77,286 78,831 80,408 82,016 83,656 85,330 87,036 96,095 106,097 Replacement Reserves 0.00% 500 35,000 35,000 35,000 35,000 35,000 35,000 35,000 35,000 35,000 35,000 35,000 35,000 Total Expenses 14,916 $1,044,096 $1,078,322 $1,113,724 $1,150,342 $1,188,220 $1,227,400 $1,267,928 $1,309,851 $1,353,215 $1,398,073 $1,646,627 $1,941,073 Net Operating Income $116,779 $111,575 $105,920 $99,792 $93,168 $86,022 $78,330 $70,064 $61,197 $51,700 -$6,341 -$85,241 Debt Service amount rate amort
SHRA Monitoring Fee $5,236,000 0.125% 7,445 7,445 7,445 7,445 7,445 7,445 7,445 7,445 7,445 7,445 7,445 7,445 Debt Service Subtotal $7,445 $7,445 $7,445 $7,445 $7,445 $7,445 $7,445 $7,445 $7,445 $7,445 $7,445 $7,445 Cash Available after Debt Service $109,334 $104,130 $98,475 $92,347 $85,723 $78,577 $70,885 $62,619 $53,752 $44,255 ($13,786) ($92,686) Priority Distributions
Limited Partner Management Fee 3.00% 0 0 0 0 0 0 0 0 0 0 0 0 Asset Management Fee $20,000 3.00% 20,000 20,600 21,218 21,855 22,510 23,185 23,881 24,597 25,335 26,095 30,252 35,070 Managing General Partner Management Fee 3.00% 0 0 0 0 0 0 0 0 0 0 0 0 Administrative General Partner Fee 3.00% 0 0 0 0 0 0 0 0 0 0 0 0 Priority Distributions Subtotal 20,000 20,600 21,218 21,855 22,510 23,185 23,881 24,597 25,335 26,095 30,252 35,070 Net Cash after Priority Distributions $89,334 $83,530 $77,257 $70,493 $63,213 $55,392 $47,004 $38,022 $28,417 $18,160 ($44,038) ($127,756) SHRA Loans
Principal Balance $5,236,000 0.00% 5,236,000 5,236,000 5,236,000 5,236,000 5,236,000 5,236,000 5,236,000 5,236,000 5,236,000 5,236,000 5,236,000 5,236,000 Interest for Period 0 0 0 0 0 0 0 0 0 0 0 0
Payment 0 0 0 0 0 0 0 0 0 0 0 0
Balance $5,236,000 $5,236,000 $5,236,000 $5,236,000 $5,236,000 $5,236,000 $5,236,000 $5,236,000 $5,236,000 $5,236,000 $5,236,000 $5,236,000 Capital Operating Subsidy Reserve $400,000 0.5%
Beginning Balance $400,000 $491,334 $577,320 $657,464 $731,244 $798,113 $857,495 $908,787 $951,353 $984,526 $983,803 $627,638 Deposit (or Withdrawal) $89,334 $83,530 $77,257 $70,493 $63,213 $55,392 $47,004 $38,022 $28,417 $18,160 -$44,038 -$127,756 Interest Earned $2,000 $2,457 $2,887 $3,287 $3,656 $3,991 $4,287 $4,544 $4,757 $4,923 $4,919 $3,138 Ending Balance $491,334 $577,320 $657,464 $731,244 $798,113 $857,495 $908,787 $951,353 $984,526 $1,007,608 $944,684 $503,021
Rodeway Inn
Cash Flow ProformaAttachment 4
Attachment 5
Addresses
Number of Units
Construction Type
Acreage
Unit Mix and Rents 30% AMI PBV Exempt Management Unit
Studio 69 -
1BR/1BA - 1
Total Units 69 0
Square Footage (both locations) Number of Units Unit Size (sq.ft.) Total (sq. ft.) Studio (Type 1) 18 230 4,140
Studio (Type 2) 26 320 8,320
Studio (Type 3) 26 370 9,620
Common Areas 11,620
Total Gross 33,700
Resident Facilities
Permanent Sources Total Per Unit Per Square Foot
HOMEKEY Grant 20,386,000$ 291,229$ 605$
SHRA HHAP4 3,223,000$ 46,043$ 96$
MHSA 2,013,000$ 28,757$ 60$
TOTAL SOURCES 25,622,000$ 366,029$ 760. 30$
Permanent Uses Total Per Unit Per Square Foot
Acquisition 13,500,000$ 192,857$ 400.59$
Construction Costs 7,347,007$ 104,957$ 218.01$
Architecture & Engineering 442,350$ 6,319$ 13.13$
Permits/Fees 278,470$ 3,978$ 8.26$
Hard Cost Contingency 1,102,051$ 15,744$ 32.70$
TOTAL HARD COSTS 22,669,878$ 323,855$ 672. 70$
Soft Cost Contingency 250,049$ 3,572$ 7.42$
Operating Reserves 400,000$ 5,714$ 11.87$
Legal Fees 35,000$ 500$ 1.04$
Developer Fee 1,500,000$ 21,429$ 44.51$
Third Party Fees, Marketing, Other 767,073$ 10,958$ 22.76$ TOTAL SOFT COSTS 2,952,122$ 42,173$ 87. 60$
TOTAL USES 25,622,000$ 366,029$ 760. 30$
SHRA $ per Unit Per Unit Cost
74,800$ 366,029$ $1.00 : $4.89
Management / Operations
Proposed Developer
Property Management Company
Operating Expenses 604,938$ 8,642$
Property Management Fee 62,988$ 900$
Resident Services 268,342$ 3,833$
Replacement Reserves 35,000$ 500$
Taxes and Insurance 72,828$ 1,040$
Rodeway Inn
Residential Project Summary
25 Howe Avenue, Sacramento, CA 95825
70 Rehabilitation
1.62 Total
69 1
70 per unit
Amenities on site will include a resident community space, laundry facilities, landscaped courtyards and outdoor gathering/seating, barbeque, picnic tables, vehicle and bicycle parking.
Leverage
Leverage
SHRA
Hope Cooperative
John Stewart Company
per unit
per unit
per unit
per unit
Attachment 6
Family Size 30% AMI
1 person $ 21,300
2 person $ 24,330
3 person $ 27,360
Unit Size 30% AMI
Studio 532$
¹
Pursuant to 24CFR 983.301, contract rents approved by HUD may exceed the tax-credit rent limits. The tenant rent will not exceed 30% of the household adjusted gross income with PBV.
Rent Limits¹
Rodeway Inn
MAXIMUM GROSS INCOME AND RENT LIMITS 2023
Maximum Gross Income Limits
RESOLUTION NO.
ADOPTED BY THE HOUSING AUTHORITY OF THE
CITY OF SACRAMENTO
A RESOLUTION OF THE GOVERNING BODY OF THE HOUSING AUTHORITY OF
THE CITY OF SACRAMENTO AUTHORIZING JOINT APPLICATION TO AND
PARTICIPATION IN THE HOMEKEY PROGRAM FOR THE RODEWAY INN
PROJECT
WHEREAS, t he Department of Housing and Community Development (“Department”) has issued a Notice of Funding Availability, dated March 29, 2023 (“NOFA”), for the Homekey Pro gram (“Homekey” or “ Program”). The Department has issued the NOFA for Homekey grant funds pursuant to Health and Safety Code section 50675.1.3 (Assem. Bill No. 140 (2021-2022 Reg. Sess.), § 20.).
WHEREAS, the Housing Authority of the Ci ty of Sacramento “Co-Applicant”) desires to jointly apply for Homekey grant funds with 25 Howe Avenue LP ( HOPE Cooperative) (“Corporation”). Therefore, Co-Applicant is joining Corporation in the submittal of an application for Homekey funds (“Application”) to the Department for review and consideration.
WHEREAS, the Department is authorized to administer Homekey pursuant to the Multifamily Housing Program (Chapter 6.7 (commencing with Section 50675) of Part 2 of Division 31 of the Health and Safety Code). Homekey funding allocations are subject to the terms and conditions of the NOFA, the Application, the Department-approved STD 213, Standard Agreement (“ Standard Agreement ”), and all other legal requirements of the Homekey Program.
NOW, THEREFORE, BE IT RESOLVED BY THE HOUSING AUTHORITY OF THE CITY OF SACRAMENTO:
Section 1. Co-Applicant is hereby authorized and directed to submit a joint Application to the Department in response to the NOFA, and to jointly apply for Homekey grant funds in a total amount not to exceed $20,386,000.
Section 2. If the Application is approved, Co-Applicant is hereby authorized and directed to enter into, execute, and deliver a Standard Agreement in a total amount not to exceed $20,385,000, any and all other documents required or deemed necessary or appropriate to secure the Homekey funds from the Department and to participate in the Homekey Program, and all amendments thereto (collectively, the “Homekey Documents”).
Section 3. Co-Applicant acknowledges and agrees that it shall be subject to the terms and conditions specified in the Standard Agreement, and that the NOFA and Application will be incorporated in the Standard Agreement by reference and made a part thereof. Any and all activities, expenditures, information, and timelines represented in the Application are enforceable through the Standard Agreement. Funds are to be used for the allowable expenditures and activities identified in the Standard Agreement.
Section 4. The Sacramento Housing and Redevelopment Agency Executive Director or her designee, is authorized to execute the Application and the Homekey Documents on behalf of Co-Applicant for participation in the Homekey Program.
On a motion by Member_______________ ______________, seconded by Member _____________, the foregoing Resolution was passed and adopted by the Housing Authority of the C ity of Sacramento, State of California, this 9th day of May, 2023, by the following vote, to wit:
AYES: Members,
NOES: Members,
ABSTAIN: Members,
ABSENT: Members,
____________________________ ___
Chair of the Housing Authority of the
City of Sacramento, California
SEAL:
ATTEST: ____________________________________
Clerk
The undersigned, Clerk of the Board of Co-Applicant, does hereby attest and certify that the foregoing is a true and full copy of a resolution of the governing body adopted at a duly convened meeting on the date above -mentioned, and that the resolution has not been altered, amended, or repealed.
SIGNATURE: _________________ DATE: _____________________
NAME: __Mindy Cuppy_ TITLE: City Clerk
RESOLUTION NO. 2023 –
Adopted by the Sacramento City Council
on date of
RODEWAY INN PROJECT: APPROVAL OF CONDITIONAL LOAN AND GRANT COMMITMENT (COMMITMENT); AUTHORIZATION TO EXECUTE FUNDING AGREEMENT, AND RELATED DOCUMENTS WITH 25 HOWE AVENUE LLC (HOPE COOPERATIVE) OR RELATED ENTITY FOR THE PROJECT; AMEND THE SACRAMENTO HOUSING AND REDEVELOPMENT AGENCY BUDGET; AND
ENVIRONMENTAL FINDINGS
BACKGROUND
A. The Housing Authority of the City of Sacramento and their co -applicant, HOPE Cooperative or related e ntity (Developer), desire to apply for approximately $20,386,000 in Homekey Program funds from the California Department of Housing and Community Development for the Rodeway Inn Project (Project). The proposed Project located at 25 Howe Avenue (APN 228 -0141-028) includes the acquisition and conversion of a motel into 70 studio apartment units . Authorization to apply for Homekey funding is addressed in a separate Housing Authority resolution.
B. On February 7, 2023, the Council committed $3,223,000 in Homeless Housing Assistance and Prevention 4 (HHAP4) funds to the Rodeway Inn Project subject to final receipt of the HHAP4 grant funding, completion of the necessary environmental review, and approval as to form by the City Attorney’s Office.
C. In March of 2023, the Developer requested gap funds in the amount of $5,236,000 to assist in the construction and permanent financing of the Project that will serve as permanent supportive housing for individuals and families.
Sacramento Housing and Redevelopment Agency (SHRA) is proposing to utilize Mental Health Services Act (MHSA) funding, which is under the purview of the County of Sacramento, and the previously committed HHAP4 funds for the Project. MHSA funding is expected to be approved by the Sacramento County Board of Supervisors on May 9, 2023.
C. The Project has been analyzed in accordance with the California Environmental Quality Act (CEQA) and has been determined to be exempt from CEQA pursuant to Health & Safety Code, Section 15301 (existing facilities).
D. The Project is in the process of being analyzed in accordance with the National Environmental Policy Act (NEPA) and NEPA review will be completed prior to making any choice limiting action. It is anticipated t hat the review will result in a Finding of No Significant Impact (FONSI).
Rodeway Inn Project May 9, 2023
BASED ON THE FACTS SET FORTH IN THE BACKGROUND, THE CITY COUNCIL RESOLVES AS FOLLOWS:
Section 1. All evidence presented having been duly considered, the findings, including environmental findings regarding this action, as stated above, are found to be true and accurate and are hereby approved.
Section 2. Subject to the City’s final receipt of the HHAP -4 grant funding , t he commitment of HHAP4 funds for the Rodeway Inn Project in the amount of $3,223,000 is hereby approved.
Section 3. The Commitment with the Developer, which includes $3,223,000 in HHAP4 funds for the construction and pe rmanent financing of the Project, is approved for the Rodeway Inn development.
Section 4. SHRA is authorized to negotiate, enter into, execute and amend the Commitment, funding agreement, and related documents for the construction and permanent financing of the Rodeway Inn Project with the Developer, and execute other documents, as approved to form by its Office of the General Counsel, and perform other actions deemed necessary by SHRA consistent with the objectives of HHAP4 funding, including without limitation, negotiation, amendment, subordination, regulatory agreement, financial restructuring, extensions, SHRA’s adopted policies, the HHAP4 Standard Agreement, Health & Safety Code section 50216, and with this resolution.
Section 5. SHRA’s budget is hereby amended to allocate $3,223,000 in HHAP4 funds for the Rodeway Inn development. HHAP4 funds will then be allocated to the Developer in the form of a grant for the Rodeway Inn Project.
Section 6. The City Manager, or designee, and SHRA are authorized to negotiate, enter into, and execute a HHAP4 funding agreement and related documents for the acquisition and rehabilitation financing of the Project, and execute other documents, as approved to form by the City Attorney or SHRA’s Office of the General Counsel, as the case may be, and perform other actions as the City Manager or SHRA, as the case may be, deems necessary to fulfill the intent of the HHAP funds, including without limitation, negotiation, amendment, subordination, regulatory agreement, financial restructuring, extensions, consistent with SHRA’s adopted policy, the HHAP Standard Agreement, Health & Safety Code section 50216, and with this resolution.
Table of Contents:
Exhibit A: Commitment
Attachment 6
Effective Date: May 9, 2023
TO: 25 Howe Avenue LLC
RE: Conditional Loan and Grant Commitment for Rodeway Inn Development
On behalf of Sacramento Housing and Redevelopment (Agency), we are pleased to advise you of this Conditional Loan and Grant Commitment of a construction, operation and permanent loan (Loan and Grant) comprised of funds listed below for the purpose of construction, operation and permanent financing of that certain real property known as Rodeway Inn development located in the City of Sacramento at 25 Howe Avenue, Sacramento, California (Property).
SHRA Funding Programs Amount
Construction and Permanent Loan
Homeless Housing, Assistance, and Prevention (HHAP4) –Grant $ 3,223,000 Mental Health Services Act (MHSA) Construction and Permanent Loan $ 2,013,000 Total SHRA Loan $ 5,236,000
The Agency's decision is based on your application, and all representations and information supplied by you to it. If these representations and information change in a material manner without written approval of the Agency, this C ommitment is void. Agency's obligation to make the Loan are subject to the satisfaction of all the following t erms and conditions and Borrower's execution of documentation that is in a form and in substan ce satisfactory to the Agency.
The Loan shall be made on standard Agency loan documents. Loan terms not in this Commitment and the attached loan document forms shall not be included in the final loan documents without additional environmental review and governing board approval. In the event of any discrepancies between terms stated in this C ommitment and the loan documents, the terms stated in th is Commitment shall be deemed to be terms of this Commitment.
Unless otherwise agreed in writing by the Agency in exercise of its absolute discretion, the following shall be considered conditions to Agency approval of a fina ncing commitment. The Agency may, in exercise of its absolute discretion, modify its requirements upon written notice to Borrower given at least sixty (60) days prior to close of escrow for the Property.
This Commitment will expire October 31, 2024 unless a mutually agreed upon extension is made.
PROJECT DESCRIPTION: The Rodeway Inn Project will rehabilitate the three-story building currently containing 101 motel rooms into 69 studio apartment units and one one-bedroom manager’s unit. Eighteen of the existing rooms will be converted into studio apartments. Fifty- two studio apartments will be larger by converting and combining 78 of the existing rooms.
Kitchenettes will be added to all units. Seven of the rooms will be used to create offices and other meeting areas. The building is double-sided with exterior access rooms in an L shape
Sacramento Housing and Redevelopment Agency “Changing Lives” 801 12th Street · Sacramento, CA 95814 · www.shra.org
overlooking a courtyard and protruding elevator on the west side facing Howe Avenue. Site improvements will include enhanced perimeter fencing, converting parking areas to landscaping, pet areas, and gathering areas.
1. BORROWER: The name of the Borrower for the Loan, is 25 Howe Avenue LLC or related entity, (Developer).
2. PURPOSE OF LOAN : The Loan is to be used by Borrower solely to pay the costs of construction and permanent financing and for such other purposes as Agency expressly agrees to in the loan agreement for the Loan, and such other agreements as may be generally required by the Agency for the use of the funding source for the Loan.
3. PRINCIPAL AMOUNT OF LOAN: The combined principal amount of the Loan will be the lesser of the following:
a. Five Million Two Hundred Thirty Six Thousand Dollars and No Cents ($5,236,000), or
b. An amount to be determined prior to close of the Loan based on a project budget approved by Agency.
4, TERM OF LOAN: The Maturity Date of the Loan is 40 years or 480 months from the date of closing, at which point any and all unpaid principal and interest on the loan will be due and payable.
5. INTEREST RATE OF LOAN: The Loan will bear simple interest at zero percent (0%) per annum. Interest shall be calculated on the basis of a 365-day year and actual number of days elapsed.
6. ANNUAL REPAYMENT OF LOAN : Annual principal and interest payments shall be made according to the structured payment schedule contained in the final Loan Agreement with mutually agreed upon deposits to the Capitalized Operating Reserve and as calculated to achieve a minimum annual debt service coverage ratio of 1.2:1. Payments shall be applied first to outstanding interest accrued and unpaid and then to principal. All outstanding principal and interest is due and payable on the Maturity Date.
7. SOURCE OF LOAN FUNDS: Agency is making the Loan from the following sources of funds, and the Loan is subject to all requirements related to the use of such, whether Agency requirements or otherwise : HHAP4, and MHSA. This Loan is conditioned upon Borrower’s acceptance of Agency’s requirements and conditions related to such lending programs and funding sources, including among others, the required forms of agreements for the Loan; the requirements for covenants, conditions and restrictions upon the Property; and insurance and indemnity requirements.
8. Borrower acknowledges that, as a condition of the Agency’s making of the Loan, the Property will be subject to restrictions on future sales and rentals which may result in less income to Borrower than could otherwise be realized, and that such restrictions run with the land, and during their operational term, will bind all successors in interest.
Sacramento Housing and Redevelopment Agency “Changing Lives” 801 12th Street · Sacramento, CA 95814 · www.shra.org
___________ (Borrower Initial)
9. ACCELERATION: Agency shall have the right to accelerate repayment of the Loan in the event of a default under any Loan Document or upon sale, transfer or alienation of the Property except as specifically provided for in the Loan documents.
10. SECURITY: The Loan shall be evidenced by promissory note(s) secured by a deed of trust with assignment of rents against the fee and/or leasehold interest in the Property and Improvements, which shall be a lien upon the Property and Improvements subject only to liens senior to the Agency’s lien securing loans from a conventional lender or other lender and such other items as the Agency may approve in writing. The Loan shall also be secured by security agreements. The Agency may subordinate said deeds of trust in order to accommodate completion of the development of the Property. The Agency will not subordinate the regulatory agreement(s) to said deeds of trust in order to preserve the affordable housing covenants.
11. LEASE AND RENTAL SCHEDULE: All leases of the Property and Improvements shall be subject to Agency's review and approval prior to execution. Borrower shall not deviate from the rental schedule presented in Borrower's application for the Loan without Agency's prior written approval.
12. PROOF OF EQUITY: Low Income Housing Tax Credits are not applicable to the project.
13. OTHER FINANCING: Borrower, as a requirement of the Loan, shall procure and deliver to Agency evidence satisfactory to Agency that Borrower has obtained the following described financing which may be secured by a lien upon the Property and Improvements superior or subordina te to Agency's liens, and which shall be otherwise on terms and conditions acceptable to Agency:
a. Such commitments for financing shall not require modification of Agency loan documents, or any term of this commitment letter.
b. Such commitments shall not be b ased upon sources and uses of Project funds that are different from those approved by Agency for the project or be subject to conditions which require amendment of other agreements.
14. EVIDENCE OF FUNDS : Prior to the first disbursement of the Loan, Borrower must demonstrate evidence of adequate and assured funding to complete the development of the Project in accordance with the Agency's requirements. Borrower's evidence of available funds must include only one or more of the following: a) Borrower equity; b ) firm and binding commitments for the Project from financial institution(s) or from other lender(s) approved by Agency in its absolute discretion; and c) Agency’s contribution, provided, however, that Agency is not obligated by this letter to make any contribution not stated in the terms of the letter.
15. SOILS AND TOXIC REPORTS : Borrower has submitted to the Agency a hazardous substances report made in accordance with the American Society for Testing and Materials "Standard Practice for Environmental Site Assessments; Phase I Environmental Site
Sacramento Housing and Redevelopment Agency “Changing Lives” 801 12th Street · Sacramento, CA 95814 · www.shra.org
Assessment Process" (Designation E15 27-13) prepared by a licensed or registered environmental engineer or other qualified party prior to Loan closing. Borrower must, as a condition of disbursement of Loan funds, provide assurances satisfactory to the Agency that hazardous materials are not present on the Property or that any hazardous materials on the Property will be remediated and that no further remediation is then required by the environmental agency having responsibility for monitoring such remediation.
16. LOAN IN BALANCE: Borrower will be required to maintain the Loan "in balance". The Loan is "in balance" whenever the amount of the undisbursed Loan funds, the remaining sums to be provided by the Borrower and the loan funds from other project lenders or the equity investor are sufficient, in the sole judgement of the Agency, to pay for the remainder of the work to be done on the project as required by written agreement with the Agency.
Should the Agency determine that the Loan is not "in balance", the Agency may declare the Loan to be in default.
17. PLANS AND SPECIFICATION : Final plans and specification s, if any, for the project must be in accord with the proposal approved as part of the Loan application. Final plans and specifications will be subject to Agency's final approval prior to t he disbursal of Agency Loan funds. Borrower must obtain Agency's prior written consent to any change in the approved plans and specifications or any material deviation in construction of the project. The final plans shall incorporate all related mitigation measures, environmental conditions required, if any, for compliance with approvals under CEQA, and/or NEPA, or the U.S. Department of Housing and Urban Development as conditions of approval of the project.
18. ARCHITECTURAL AGREEMENT: The architec tural agreement (Agreement) , if any, for the preparation of the plans and specifications and other services shall be subject to Agency's approval. Agency may require an assignment of Borrower's interest in and to the Agreement as security for the Loan.
19. CONSTRUCTION CONTRACT: The construction contract ( Contract), if any, and any change orders issued thereunder, and the contractor (Contractor) to be retained by Borrower to construct the Improvements shall be subject to Agency's approval. Agency may require an assignment of Borrower's interest in and to the Contract as security for the Loan. Agency may require Contractor to provide a performance and payment bond in a form acceptable to Agency for the amount of the Contract.
20. ECONOMIC OPPORTUNITY EMPLOYMENT REQUIREMENTS : The Loan will require that to the greatest extent feasible, opportunities for training and employment be given to lower income residents in and around the area of the project. Borrower will instruct its Contractor and its subcontra ctors to utilize lower income project area residents as employees to the greatest extent feasible.
21. RETENTION AMOUNT: The Agency shall retain ten percent (10.0%) of the total amount of the Loan as retention and shall be released when the Agency determines all conditions to final disbursement of the Loan have been satisfied.
Sacramento Housing and Redevelopment Agency “Changing Lives” 801 12th Street · Sacramento, CA 95814 · www.shra.org
22. COST BREAKDOWN: Borrower shall deliver to Agency for Agency's approval prior to commencement of work a detailed cost breakdown of the cost of constructing, financing and other costs of developing the Improvements, which breakdown conforms to the project plans and specification and the budget approved with this C ommitment. Borrower shall also deliver a list of all contractors and subcontractors to be employed in connection with the construction of the Improvements. If required by the Agency , Borrower shall also submit copies of all bids received for each item of work to be performed as well as copies of executed contracts and subcontracts with acceptable bidders.
All contracts, subco ntracts, contractors, and subcontractors shall be subject to Agency's approval prior to close of the Loan. Agency also reserves the right to require performance and material payment bonds on any or all contractors, or in lieu of bond a letter of credit acceptable to Agency.
Agency shall make disbursements of the Loan based on a cost breakdown that lists line items in cost categories. Agency shall require that Borrower provide documentation supporting all requests for disbursement of Loan funds, including proof of work done and actual expenditure. Agency shall conduct inspections of the Property to assure that the work was done before making a disbursement.
23. COST SAVINGS: At completion of construction, Borrower shall submit to Agency a cost certification prepared by a qualified, independent auditor acceptable to Agency, which cost certification shall indicate the amounts actually spent for each item in the cost breakdown and shall indicate the final sources of funding. If there is an aggregate savings, in the total of all such cost breakdown items from the cost breakdown items in the original budget approved by the Agency, after adjusting for any decrease in any funding source , the Agency shall withhold for itself as loan repayment, one -half of s uch savings from the amount of retention then held by the Agency, and the Loan balance shall be reduced by the amount so withheld. The Agency, in its sole discretion, shall determine any reduction and/or repayment of the Agency loan based upon this cost ce rtification and the original approved budget for the project.
24. START OF CONSTRUCTION : Borrower shall commence construction at the earliest possible date subject to the conditions of this Agency and other involved lenders, but no later than fourteen (14) days following the close of construction financing.
25. COMPLETION OF CONSTRUCTION: Borrower shall complete the construction of the Improvements no later than twelve (12) months (Constriction Period) following the close of construction financing , unless the Notice of Available Funding (NOFA) and/or Guidelines, as amended, for Homekey Program funds dictate a more restrictive Construction Period, or extension is approved by Agency.
26. SECURITY CAMERAS AND OUTSIDE LIGHTING : Project shall include installation of a security camera system at vehicular driveways and additional exterior lighting, and security patrols, all as approved by the Agency.
Sacramento Housing and Redevelopment Agency “Changing Lives” 801 12th Street · Sacramento, CA 95814 · www.shra.org
27. INSURANCE PROVIDER : Each policy of insurance required under the Loan shall be obtained from a provider licensed to do business in California and having a current Best's Insurance Guide rating of A VII, which rating has been substantially the same or increasing for the last five (5) years, or such other equivalent rating, as may reasonably be approved by Lender's legal counsel.
28. PROPERTY INSURANCE: Borrower shall procure and maintain property insurance and during construction Builder's Risk completed value insurance in a form and substance approved by Agency. Coverage shall be for protection against loss of, or damage to the Improvements or materials for their construction to their full insurable value. Borrower shall also procure and maintain insurance against specific hazards affecting Agency's security for the Loan as may be required by Agency, governmental regulatio ns, or any permanent lender. All such policies shall contain a standard mortgagee loss payable clause in favor of Agency. The insurance required shall be written with a deductible of not more than $25,000.00.
29. COMMERCIAL GENERAL LIABILITY AND OTHER INSURANCE:
Borrower shall carry insurance as set forth below effective prior to the disbursement of the Loan, and such insurance shall be maintained in full force and effect at all times and work is performed in connection with the project. Such insurance coverage must list the Agency as an additional insured, and must be approved in writing by Agency prior to the disbursement of the Loan.
a. Commercial general liability insurance, in Insurance Services Office (ISO) policy form CG 00 01 or equivalent, with limits of liability not less than: $1,000,000 per occurrence, and $5,000,000 general aggregate, all per location of the project, such coverage to include contractual liability to include bodily injury, property damage and personal injury;
b. Personal injury insurance with the employment exclusion deleted, unless the Agency gives prior written approval for the employment exclusion to remain in the policy;
c. Commercial automobile liability insurance for any vehicle used for or in connection with the project, in an amount not less than $1,000,000 and approved in writing by Agency; and
d. Workers’ compensation and all other insurance required under applicable law, in the amount required by applicable law or by Agency, whichever amount is greater.
30. TITLE INSURANCE: Borrower must procure and deliver to Agency a n ALTA Lender's Policy of Title Insurance, together with such endorsements as Agency may require, including but not limited to ALTA endorsement nos. 9. 06 and 28 insuring Agency in an amount equal to the principal amount of the Loan and covenants, conditions or restrictions of the Loan, that Agency's Deed of Trust constitutes a third lien or charge upon the Property and Improvements subject only to such items as sh all have been approved by Agency.
There must be no exceptions permitted for mechanics liens. Title insurance for the Loan must be issued by a title insurer approved by Agency.
Sacramento Housing and Redevelopment Agency “Changing Lives” 801 12th Street · Sacramento, CA 95814 · www.shra.org
31. ORGANIZATIONAL AGREEMENTS: Borrower must submit to Agency certified copies of all of Borrower’s organizational documents, including all amendments, modifications or terminations: if a corporation, Borrower's Articles of Incorporation and By -Laws; if a partnership, its Partnership Agreement and, as applicable, Certificate of Limited Partnership or Statement of Partnership; if a Limited Liability Company, its Articles of Organization and its Operating Agreement; and in all cases with all exhibits and amendments to such documents, fictitious business name statements, other related filin gs or recorded documents and such related documents as Agency may request. If it is a corporation, Borrower must submit a corporate borrowing resolution referencing this Loan.
If Borrower is other than a corporation, Borrower must submit such proof of au thority to enter this Loan as may be required under the organizational documents.
32. PURCHASE OF PROPERTY : Borrower shall provide Agency with copies of all documents relating to Borrower's purchase of the Property.
33. FINANCIAL INFORMATION: During the term of the Loan, Borrower shall deliver to Agency within 120 days of the end of each fiscal year an audited income and expense statement, a balance sheet, and a statement of all changes in financial position signed by authorized officers of Borrower. Prior to close of the Loan and during its term, Borrower must deliver to Agency such additional financial information as may be requested by Agency. Agency reserves the right to review and approve financial statements and other credit information and references prior to closing. During the term of the Loan, Borrower must deliver to Agency a monthly rent -roll including household composition information and operating statements with respect to the Property and Improvements, as Agency may request.
34. MANAGEMENT AGREEMENT: Prior to execution, Borrower must submit to Agency any agreement providing for the management or operation of the Property or Improvements by a third party which agreement is subject to Agency Approval.
35. AFFIRMATIVE FAIR MARKETING : Borrower agrees to follow the Agency’s Affirmative Marketing Policies that require outreach to groups least likely to apply for the housing based on local demographic information, providing sufficient marketing time prior to lease Up (as defined in the Affirmative Marketing Policies), and lotteries or other method for initial Lease Up and initial waiting list creation, as agreed upon by the Agency and Borrower prior to the start of Lease Up.
36. RESIDENT SERVICES AGREEMENT : Prior to execution, Borrower must submit to Agency any agreement providing for the resident services by a third party which agreement is subject to Agency Approval.
Borrower will provide two case manager s and two will be provided by the County of Sacramento. The agreement must include on -site resident services according to the following minimum schedule of fifteen (15) hours per week:
a. Coordinator: Three (3) hours per week (maximum)
Sacramento Housing and Redevelopment Agency “Changing Lives” 801 12th Street · Sacramento, CA 95814 · www.shra.org
b. Additional Programming: Twelve hours per week shall include, but are not limited to:
i. Workforce development support and activities.
ii. Education classes such as nutrition, exercise, health resources, health insurance application assistance, annual onsite health fair and ESL classes. iii. Socialization activities such as bingo, gardening and community building events. Other services such as transportation assistance, counseling assistance and employee readiness and job search assistance will also be provided.
The County of Sacramento with pr ovide case management for the MHSA residents. In addition, two full time case managers will be provided on site for the non-MHSA residents.
37. LOW INCOME HOUSING TAX CREDITS (LIHTC): LIHTC does not apply to this project.
38. SMOKE-FREE ENVIRONMENT: Fifty percent (50%) of the buildings and units must be smoke free (including all forms of smoking that create secondhand smoke that impacts the health of nonsmokers). In addition, all indoor common areas must be smoke-free. Clearly- marked designated smoking areas must be provided.
39. DOCUMENTATION: This letter is not intended to describe all of the requirements, terms, conditions and documents for the Loan, which shall also include customary provisions and documents for an Agency transaction of this type. All d ocuments to be delivered to or approved by Agency must be satisfactory to Agency in all respects. Borrower must promptly deliver to Agency any further documentation that may be required by Agency.
40. CONSISTENCY OF DOCUMENTS: As a material obligation under this Commitment, Borrower shall assure that the loan documents for the Project are consistent with lender's commitment approved by the Agency and comply, in all respects, with this Commitment.
41. CHANGES OR AMENDMENTS: No documents or contracts which are to be delivered to Agency or are subject to Agency's review or approval shall be modified or terminated without the prior written approval of Agency.
42. ACCEPTANCE OF THIS COMMITMENT: Borrower’s acceptance of this Commitment shall be evidenced by signing and delivering to Agency the enclosed copy of this letter.
Until receipt of such acceptance by Agency, Agency shall have no obligation under this letter. Agency may withdraw this Commitment at any time prior to Borrower’s acceptance.
Signatures appear on the following page.
Sacramento Housing and Redevelopment Agency “Changing Lives” 801 12th Street · Sacramento, CA 95814 · www.shra.org
Sincerely,
__________________________________
La Shelle Dozier, Executive Director
The undersigned acknowledges and accepts the terms and conditions of the Commitment and Scope of Development, and has executed this Commitment as of the Effective Date.
BORROWER:
_____________________________________
Name:
1413 Howe Avenue LP
Attachment:
Exhibit 1 - Scope of Development
Sacramento Housing and Redevelopment Agency “Changing Lives” 801 12th Street · Sacramento, CA 95814 · www.shra.org
Exhibit 2: Scope of Development
Hope Cooperative Rodeway Inn Homekey Conversion (“RWI”) Scope of Development –
Adaptive Re-use – Rehabilitation
The RWI is an existing operating tourist motel built in 1990 located at 25 Howe Avenue in the City of Sacramento with 101 operating rooms located on approximately 1.62 acres. Ninety-six of the existing 101 rooms will be converted to 3 different studio apartment plans, plus 1 irregular staff unit, for a total of 70 units. There are currently 5 ADA mobility units and 6 more will be created for a total of 11 or 15%. The existing common areas and amenities include an existing lobby and lounge with restroom. A kitchen will be added to the lounge/meeting area.
The existing open lounge area was once the owner’s suite. One former unit is already an office will serve property management in addition to the front desk. Five additional rooms near the lobby will be converted into offices/small meeting spaces for resident services and case management. The commercial laundry room will be converted to a resident laundry room. Ample storage exists through the building for maintenance and supplies.
All work shall comply with Accessibility requirements of Chapter 11B of the California Building Code, as well as Federal Americans with Disability Act (ADA) accessibility requirements as applicable, as well as any other requirements stipulated by the funding sources. The architect will indicate these funding requirements in the Project’s plans/scope of work.
I. Site Work
1. Asphalt Pavement: Repair, resurface and restripe parking lot. Certain parking spaces will be removed and converted to landscaped/recreation uses.
2. Repair/replace curb, and sidewalk areas with excessive cracking, tree root damage and non -conforming ADA path of travel slopes and barriers.
3. Drainage: Damaged and missing gutters and downspouts will be repaired or replaced and 2% slope for five (5) feet away from all structures will be ensured.
4. Landscaping Improvements: Landscaping improvements will include installation of consistent and drought-tolerant plants and shrubs and removal and replacement of trees, as well as bark/mulch, and a Smart Controller programmable automated irrigation system. Plans to be approved by SHRA.
5. Mailboxes: US Postal Service conforming mailboxes and parcel boxes (cluster box units) will be added in a central location near the lobby.
6. Recreation/gathering Areas: Barbeque, seating, smoking, ball court will be created at the south parking lot; The pool will be fille din landscaped as another gathering area with water feature for sound; and at the far western parking area, pet areas will be added.
7. Pool/Spa Removal: The existing pool and equipment will all be removed and filled in for recreation, gathering/landscaping uses and a possible additional water feature.
8. Security Cameras: The existing security surveillance camera system will be upgraded and additional cameras will be added. Camera locations will include primary ingress/egress points to and from the site, parking lots, and indoor and outdoor common areas where people congregate (including management office, laundry room, and play areas).
9. Sewer Repairs: All laterals will receive complete cabling and jet cleaning.
10. Site Lighting: Minor upgrades/additions will be made to the system that is already converted to LED.
11. Signage: New and/or modified unit identification, way finding, code, fire, and life and safety signage will be installed. Signage will be code-compliant and include braille and raised letter unit and site signage.
12. Site Fencing: New fencing will be added to enclose the converted south parking lot area to landscape gathering space. Emergency only pedestrian gate access will be included. The existing 4 foot tall front vehicle gate entry system will be replaced with 6 foot tall version. A pedestrian with access control will be
Sacramento Housing and Redevelopment Agency “Changing Lives” 801 12th Street · Sacramento, CA 95814 · www.shra.org
added at the main entry. The west and south chain link in disrepair will be replaced (or supplemented if over property line) with wrought iron.
13. Trash Enclosure: One accessible trash enclosure made of concrete block and a concrete apron will be modified and expanded at its current location in the parking lot for resident and staff use.
II. Building Exteriors
1. Building Envelope: Stucco will be repaired as needed.
2. Building Lighting: Exterior building and parking lot lighting is recently upgraded LED. Additional lighting will be added to improve a few dark areas.
3. Exterior Painting: Building exteriors (fascia, walls, doors, door frames, and trim throughout exterior walkways and laundry room) were all recently repainted.
4. Roofing: The cement tile roof is budget for replacement due to the likely disrepair of the paper underneath and the desire to add solar panels.
5. Common Stairs: Minor repairs as needed.
6. A clear pest inspection report will be provided at the conclusion of the construction work.
III. Building Interiors
1. Accessible Units for the Mobility Impaired and Audio Visual Impaired: 15% (11) of all 70 units currently comply with mobility accessibility requirements. Five are existing, and up to 6 additional mobility units will be added to achieve 15% necessary for Homekey points. Seven vision and hearing - impaired units will be added to achieve 10% for Homekey points.
2. Appliances: All units will receive new ranges (Energy Star if available), new Energy Star-rated refrigerators, new sinks and faucet sets, and new Energy Star range hood fans.
3. Bathtubs, Toilets, and Other Bath Fixtures: Only the mobility units will get all new bath features as needed. Original bath/shower mixer valves to be replaced with code compliant units.
4. Kitchen Cabinets, Counters and Sinks: All units will have a full cabinet, countertop, and sink added.
Cabinets will be all wood construction; countertops will be stone or composite stone.
5. Ceilings and Walls: Units will receive drywall repairs at existing damage and where remodeling is part of the plan.
6. Doors: Interior unit doors (for closet, bedroom and bathroom) are typically hollow core painted swing doors, generally in good condition, and will not be replaced. Interiordoor hardware will be replaced with matching hardware..
7. Electrical and Lighting: Wiring and panels will be replaced or added as needed. Electrical panelboards will be replaced in all units. All interior lighting is LED and in good working order. Any sw itches, outlets and light fixtures not meeting current applicable codes will be replaced.
8. Flooring: All units will have new LVP flooring.
9. Heating and Cooling: All PTAC units over 3 years in age will be replaced with more energy efficient models. 100% is budgeted, 1 per unit.
10. Bath Exhaust Fans: Bath exhaust fans will be replaced with humidistat controlled fans.
11. Interior Paint: All units will be repainted and interior common areas will be repainted.
12. Plumbing: supply and waste lines will be extended from bathrooms for the added kitchenettes where not already present. Any toilets, showerheads, faucets and mixing valves not meeting current codes will be replaced.
13. Water heater: The single gas fired water heater serving the entire building will be replaced with a more energy efficient model.
14. Outlets: Non-ground-fault circuit interceptor (GFCI) are present throughout at required locations. New GFCI’s and electric outlets will be added at new kitchen counters as required by code.
15. Smoke Alarms, Etc.: All units will receive new AC powered combination smoke alarm/carbon monoxide detectors in the hallway outside the bedrooms. Bedroom smoke detectors will be replaced with new AC powered smoke detectors. Per code, smoke detectors will be interconnected within each unit.
Sacramento Housing and Redevelopment Agency “Changing Lives” 801 12th Street · Sacramento, CA 95814 · www.shra.org
16. Window Treatments: Existing fabric will be replaced with vertical vinyl blinds.
17. Where disturbance of any hazardous materials (e.g. lead, asbestos, mold, etc.) occurs, a clearance report from an environmental consultant will be provided at the end of construction. Per building department requirements, appropriate testing will be done prior to the start of work and results shared with SHRA.
18. Windows: All windows will be replaced.
IV. Interior Community Amenities
1. Telecom/Broadband Infrastructure: Existing coaxial cable to each unit will provide all necessary phone, internet and TV options thru Comcast or other service provider.
2. Laundry Facility: A new tenant laundry room will be created at the existing motel commercial laundry room for 5 sets of washer/dryers (1 per 15 units).
3. Lobby/front desk: The existing The front desk casework will be modified for ADA access and will be raised for greater security.
4. Property management offices: The immediately behind the front desk will serve as the property managers office.
5. Services offices: Three rooms will be converted to case manager offices for the 4-5 case managers expected to be on site at any given time. An additional room will be converted to an office for the Resident Services Coordinator. A 5th former room will be converted to a medium sized meeting room.
6. Community building/room: The existing recently renovated open lounge area adjacent to the lobby will have a kitchen area added and will serve as a large meeting room and lounge area.
7. Elevator: The interior will be upgraded with new finishes.
8. Electric Service: Existing electric service will be evaluated for capacity to serve new loads, including unit refrigerators an and ranges and new elevator(s). Electric service will be upgraded if required.