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CONSENT CALENDAR
City of San Bernardino
Request for Council Action
Date: March 6, 2024
To: Honorable Mayor and City Council Members
From: Charles A. Montoya, City Manager;
Cassandra Searcy, Deputy Director of Housing and
Homelessness
Department: Community Development and Housing Department (CD) Subject: Arrowhead Grove Phase IV Affordable Housing
Project Conditional Funding Commitment (Ward 2)
Recommendation:
It is Recommended that the Mayor and City Council of San Bernardino, California
1. Adopt Resolution No. 2024-036 of the Mayor and City Council of the City of San Bernardino, California, approving a Conditional Funding Commitment for Arrowhead Grove Phase IV, an affordable housing project; and
2. Authorize the City Manager, or designee, to take any further actions and execute any further agreements or documents as necessary including minor and substantive changes.
Executive Summary
Approval of Resolution No. 2024-036 is a conditional funding commitment of HOME Investment Partnership and Neighborhood Stabilization Programs funds, and there will be no impact on the General Fund. Arrowhead Grove Phase IV (“Project”), 92 low- income units, is part of a total of 412 units spread over three separate parcels. The project encourages and facilitates the development of new housing in Downtown San Bernardino and along transit lines.
Background
The United States Department of Housing and Urban Development (HUD) provides HOME Investment Partnerships Program (HOME) funding to the City, to support the increase in the supply of affordable housing for low- and very low-income households.
A conditional commitment refers to the promise to commit HOME fund once the 1 9
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Housing Authority of San Bernardino County (HACSB) and National Core Renaissance of California (CORE) meet agreed upon conditions.
Arrowhead Grove is a transformational master-planned community located in the heart of San Bernardino. When complete, this 38-acre site will consist of more than 400 mixed-income apartment homes for individuals, families, and seniors.
To date, Phase I (Valencia Vista), Phase II (Olive Meadow), and Phase III (Crestview Terrace) have been completed. The following summarizes Arrowhead Grove when all phases are completed:
Phase Location
# of
Units Completion Date
City
Contribution
Valencia Vista 960 N. Valencia Ave 75 June 2016 HOME Loan Olive Meadow 610 E. Olive St. 62 November 2017 HOME Loan Crestview
Terrace
575 E. Baseline St. 184 September 2021 HOME/NSP
Loan
Phase IV TBD 91 TBD HOME/NSP
Loan
Phase V Community Centers N/A TBD TBD
TOTAL 412
The completion of the first three phases has required the support of multiple funding sources: HUD Office of Recapitalization, HUD Federal Housing Administration, HUD Lender (Wells Fargo), Tax Credit Investors, and public lenders (County of San Bernardino, HACSB, and the City).
Discussion
Phase IV would include the development of seven (7) two and three-story buildings to accommodate 92 new affordable residential units targeting income levels at 80% of the Area Median Income (AMI) and below. Phase IV would include a private community center, a swimming pool, shared outdoor common area amenities with Phases I-III, and surface parking. Development of the 92 residential units, combined with the previously developed 321 units in Phases I-III would result in a total of 412 units.
To financially support the Project, the development team plans to submit an application for the Affordable Housing and Sustainable Communities (AHSC) program. The application deadline is March 19, 2024. The AHSC program provides grants and/or loans to projects that achieve GHG emission reductions and benefit Disadvantaged Communities, Low-Income Communities, and Low-Income Households through increasing accessibility of affordable housing, employment centers, and Key Destinations via low-carbon transportation. These investments result in fewer vehicle miles traveled through shortened or reduced vehicle trip length or mode shift to transit, bicycling, or walking.
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HACSB/CORE will also be applying for tax-exempt bonds from the California Debt Limit Allocation Committee (CDLAC), which if awarded also provides 4% federal low- income housing tax credits (Tax Credits), as well as $5 million from San Bernardino County, made up of $3 million of the County’s HOME allocation and $2 million from the County’s Housing Development Fund. HACSB will be donating the land to the Project as a below market ground lease conveyance. HUD has also confirmed that the Project is eligible for the conversion of assistance of 92 units to Section 8 assistance under the Rental Assistance Demonstration (RAD) program.
AHSC scores projects on a series of factors and requires HACSB/CORE to demonstrate that the Project is financially feasible as evidenced by documentation including, but not limited to, Enforceable Funding Commitments. City staff recommends the approval of a conditional commitment of up to $1.9 million of Neighborhood Stabilization Program (NSP) funds and up to $3 million in HOME funds to support the Arrowhead Grove Phase IV Project, not to exceed $4.9 million in total City funding.
This is a conditional funding commitment, City will return at a future date to request commitment of the HOME and NSP funds, when HACSB and CORE demonstrate all the HOME commitment requirements of 24 CFR 92.2, the requirements contained in 24 CFR92.250(b), provide assessment of the market demand in the neighborhood, complete the environmental review requirements, secure all necessary financing, provide a complete budget, demonstrate cost reasonableness, submit all documentation necessary for the City to complete underwriting and subsidy layering requirements.
2021-2025 Strategic Targets and Goals
Expanding accessibility to housing will improve the quality of life for unhoused residents. The Project aligns with Strategic Target No. 3: Improved Quality of Life.
Fiscal Impact
There is no fiscal impact to the General Fund associated with this item.
Conclusion
It is Recommended that the Mayor and City Council of San Bernardino, California
1. Adopt Resolution No. 2024-036 of the Mayor and City Council of the City of San Bernardino, California, approving a Conditional Funding Commitment for Arrowhead Grove Phase IV, an affordable housing project; and 1 9
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2. Authorize the City Manager, or designee, to take any further actions and execute any further agreements or documents as necessary including minor and substantive changes.
Attachments
Attachment 1: Resolution 2024-036
Attachment 2: Resolution 2017-257 Arrowhead Grove Project Ward:
2ND Ward
Synopsis of Previous Council Actions:
December 20, 2017 The Mayor and City Council approved the Conditional Use Permit and Revised Subdivision for the development of the Arrowhead Grove Project.