DATE: AUGUST 6, 2024
DEPARTMENT: CITY ATTORNEY’S OFFICE
FROM: CHRISTOPHER A. CALLIHAN, CITY ATTORNEY
TITLE: HOME ARP AND PLHA FUNDS FOR PROJECT HOMEKEY
RECOMMENDED MOTION:
A motion to approve a Resolution authorizing:
the City Manager and the City Attorney to enter into any required agreements and to take any other action necessary to make previously allocated HOME ARP and PLHA funds available to two Homekey permanent supportive housing sites (180 South Sanborn Road and 1030 Fairview Avenue); the City Manager and the City Attorney to execute any required amendments or other documents necessary to incorporate the change of ownership on the three Homekey properties (180 South Sanborn Road and 1030 Fairview Avenue and 545 Work Street); City staff to take any action that may be necessary to amend or update the City’s HOME ARP Allocation Plan and the PLHA Program; and the Mayor and City Clerk to execute any required state or federal resolutions or other documents necessary to reflect amendments to or updates to the City’s HOME ARP Allocation Plan and the PLHA Program.
EXECUTIVE SUMMARY:
There are three Homekey project properties within the city of Salinas: 545 Work Street, 180 South Sanborn Road, and 1030 Fairview Avenue. With respect to the latter two properties, the Salinas City Council has previously approved the allocation of HOME ARP and PLHA funding to support the conversion and the operation of the two motels for permanent supportive housing. For 180 South Sanborn Road the City has made $968,000 of HOME ARP funds and $220,000 of PLHA funds available and for 1030 Fairview Avenue the City has made $1,298,000 of HOME ARP and $1,014,000 of PLHA funds available. The three Homekey properties are now under new ownership, with the new owners having acquired the properties through foreclosure sales that resulted from Shangri La, Inc.’s (and its various subsidiaries’) defaults.
BACKGROUND:
The City Council has previously taken action to participate in the Homekey program and, as a result, has three Homekey properties located within the city of Salinas. All three of the properties have come under new ownership through foreclosure sales as a result of Shangri La, Inc., and its various subsidiaries’ (“Shangri La”), defaults under its agreements with the State of California and with various lenders from which Shangri La borrowed money. The new owners have indicated their intent to complete the required construction work and to open the properties for their originally intended use as permanent supportive housing.
To help support the work and the operations at the 180 South Sanborn and 1030 Fairview Avenue properties, the City previously allocated $2,312,000 of HOME ARP funds and PLHA funds to the 180 South Sanborn Road property and $1,188,000 of HOME ARP funds and PLHA funds to the 1030 Fairview Avenue property. In order to continue support for these two properties, those funds need to remain available to the new property owners and usable for the activities and purposes permitted under the HOME ARP and PLHA programs. The Resolution recommended to the City Council retains this funding for those two properties and authorizes your City Manager and City Attorney to take action to make those funds available, authorizes City staff to take whatever additional action may be necessary to update the City’s HOME ARP Allocation Plan and PLHA program, and authorizes the Mayor and the City Clerk to execute additional resolutions as may be required by the State of California or HUD.
CEQA CONSIDERATION:
The City Council’s action to approve the Resolution is not a project as defined by the California Environmental Quality Act (CEQA) Guidelines section 15379 as the actions approved in the Resolution do not cause a direct or indirect physical change on the environment. Subsequent discretionary projects resulting from this action will be assessed for CEQA applicability. Activities utilizing federal funds are also subject to the National Environmental Policy Act (NEPA) and will be evaluated prior to expending any funds.
STRATEGIC PLAN INITIATIVE:
The City Council’s approval of the Resolution supports the 2022-2025 Strategic Plan Strategies and Goals of Housing/Affordable Housing and Effective and Culturally Responsive Government.
DEPARTMENTAL COORDINATION:
The Community Development Department’s Housing Division administers the City’s HOME ARP, PLHA, and Homekey programs.
FISCAL AND SUSTAINABILITY IMPACT:
No additional funding will be made available as a result of this action, consequently, there will be no impact to the City’s General Fund. Previously allocated HOME ARP funds and PLHA funds will remain available for the 180 South Sanborn Road and 1030 Fairview Avenue properties and when made available for use at these properties will have no impact to the City’s General Fund.
ATTACHMENTS:
Resolution
RESOLUTION NO. ___________ (N.C.S.)
A RESOLUTION AUTHORIZING ACTION WITH REGARD TO PERMANENT SUPPORTIVE HOUSING HOMEKEY PROJECTS AT 545 WORK STREET, 180 SOUTH SANBORN ROAD, AND 1030 FAIRVIEW AVENUE BE IT RESOLVED BY THE CITY COUNCIL OF SALINAS as follows:
HOME ARP and PLHA funds previously identified and allocated for use at 180 South Sanborn Road and 1030 Fairview Avenue will continue to be made available for use at those properties consistent with the HOME ARP and PLHA programs; The City Manager and the City Attorney are hereby authorized to enter into any required agreements and to take any other action necessary to make previously allocated HOME ARP and PLHA funds available to two Homekey permanent supportive housing sites (180 South Sanborn Road and 1030 Fairview Avenue); the City Manager and the City Attorney are hereby authorized to execute any required amendments or other documents necessary to incorporate the change of ownership on the three Homekey properties (180 South Sanborn Road and 1030 Fairview Avenue and 545 Work Street); City staff are hereby authorized to take any action that may be necessary to amend or update the City’s HOME ARP Allocation Plan and the PLHA Program; and the Mayor and City Clerk are hereby authorized to execute any required state or federal resolutions or other documents necessary to reflect amendments to or updates to the City’s HOME ARP Allocation Plan and the PLHA Program.
PASSED AND APPROVED this 6th day of August, 2024, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
APPROVED:
____________________________________
Kimbley Craig, Mayor
ATTEST:
____________________________________
Patricia M. Barajas, City Clerk
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