DATE: MARCH 7, 2023
DEPARTMENT: COMMUNITY DEVELOPMENT DEPARTMENT
FROM: MEGAN HUNTER, DIRECTOR
THROUGH: ROD POWELL, PLANNING MANAGER
LUIS OCHOA, SR. COMMUNITY DEVELOPMENT ANALYST
BY: DAVID VIGIL, HOUSING PRODUCTION COORDINATOR VISTA TITLE: APPLICATION TO THE CALIFORNIA DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT PROHOUSING INCENTIVE PILOT PROGRAM RECOMMENDED MOTION:
A motion to approve a Resolution authorizing:
the submission of a Prohousing Incentive Pilot (PIP) Program application to the California Department of Housing and Community Development; and the City Manager or designee to accept PIP Program funds, if awarded, and execute all required Agreements and related documents necessary to implement the program; and the establishment of an HCD PIP Program appropriation of up to $1,660,000, if funds are awarded, for allowable predevelopment, development, acquisition, rehabilitation, and preservation of multifamily, residential live-work, rental housing and homeownership opportunities EXECUTIVE SUMMARY:
On December 15, 2022, the California Department of Housing and Community Development (HCD) released a Notice of Funding Availability and application for its new Prohousing Incentive Pilot (PIP) Program to support the creation and preservation of affordable housing. The PIP Program intends to increase participation in HCD’s Prohousing Designation Program by pairing the designation with a significant award grant to eligible jurisdictions based upon a regional geographic categorization and a jurisdiction’s Prohousing Designation Program (PDP) Application score. The City is currently striving to be the first Central Coast jurisdiction to be awarded a Prohousing Designation and anticipates an approved score that could result in an award of up to $1,660,000.
BACKGROUND:
HCD’s PDP originates from the 2019-2020 Budget Act under Assembly Bill 101 Housing Development and Financing. In response to calls for immediate action to address the State’s housing crisis, the legislature tasked HCD with establishing and administering a PDP to enable jurisdictions that have adopted local measures, programs and incentives that go beyond existing state law to encourage and facilitate the development of housing within its jurisdiction. PDP designation would serve as an important tool to attract and encourage housing development within the City and provides a competitive advantage in seeking and securing additional housing production-related funding such as the PIP Program.
On December 13, 2022, the City Council approved a Resolution approving the submission of a PDP application to HCD. Shortly thereafter, City staff formally submitted its PDP application to on December 19, 2022. On February 7, 2023, City staff consulted with HCD technical assistance staff who provided additional recommendations to support a successful PDP application that could result in an overall score of 51 points, well above the program’s minimum 30-point threshold to obtain the designation.
DISCUSSION:
HCD has established a March 15, 2023 deadline for the submission of a PIP Program application.
In recognition of the concurrent PDP application deadline of March 30, 2023 and the impacts of its resulting score on a potential PIP award amount, HCD has encouraged jurisdictions to submit both applications and to continue to work with HCD staff to finetune the PDP application to allow for the attainment of maximum points and maximization of awarded PIP funding.
The City is actively working on providing additional perspective and supportive documentation to strengthen its PDP application to obtain as many points as possible. This is an important incentive as a higher PDP application score directly correlates to a larger amount of awarded PIP Program funds. Based upon its regional geographic categorization and population, the City would be eligible for a baseline PIP award of $1,150,000 and an additional $10,000 for each point awarded under its PDP applications. Based upon recent conversations with HCD technical assistance staff it is estimated that the City could receive a PDP score of 51 points resulting in an additional $510,000 for a total PIP award of $1,660,000.
If designated and awarded, the City intends to allocate $1,150,000 of its awarded funds towards the predevelopment, development, acquisition, rehabilitation, and preservation of multifamily, residential live-work, rental housing that is affordable to extremely low, very low, low-, and moderate-income households, including necessary operating subsidies and $510,000 towards homeownership opportunities, including, but not limited to, down payment assistance.
CEQA CONSIDERATION:
Not a Project. The City of Salinas has determined that the proposed action is not a project as defined by the California Environmental Quality Act (CEQA) (CEQA Guidelines Section 15378). In addition, CEQA Guidelines Section 15061 includes the general rule that CEQA applies only to activities which have the potential for causing a significant effect on the environment. Where it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment, the activity is not subject to CEQA. Because the proposed action and this matter have no potential to cause any effect on the environment, or because it falls within a category of activities excluded as projects pursuant to CEQA Guidelines section 15378, this matter is not a project. Because the matter does not cause a direct or foreseeable indirect physical change on or in the environment, this matter is not a project. Any subsequent discretionary projects resulting from this action will be assessed for CEQA applicability.
STRATEGIC PLAN INITIATIVE:
Submission of a PIP Program application to HCD supports City of Salinas Strategic Plan 2022-2025 Goals and Strategies of Housing/Affordable Housing by providing critical funding to increase affordable housing production and assist working families own a home.
DEPARTMENTAL COORDINATION:
HCD PDP and PIP applications have been developed by CDD Housing & Community Development Division staff under consultation with both the Current Planning and Advance Planning Divisions and City Attorney.
FISCAL AND SUSTAINABILITY IMPACT:
Acceptance of PIP Program funds, if awarded, will result in the establishment of an HCD PIP Program fund appropriation and corresponding revenue budget of up to $1,660,000.
ATTACHMENTS:
Resolution - City
Resolution – State
City of Salinas PIP Program Application – Draft
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