____________________________________________________________________________________
FOR CITY CLERK ONLY
Council Meeting:
Disposition:
Agenda Item No: 2.e
Meeting Date: May 18, 2026
SAN RAFAEL CITY COUNCIL AGENDA REPORT
Department: Community and Economic Development
Prepared by: Alexis Captanian,
Housing Manager
City Manager Approval: ______________
TOPIC: BELOW MARKET RATE RENTAL HOUSING AND HOMEOWNERSHIP PROGRAM
ADMINISTRATION
SUBJECT: RESOLUTION AUTHORIZING THE CITY MANAGER TO ENTER INTO A
PROFESSIONAL SERVICES AGREEMENT WITH MARIN HOUSING AUTHORITY
FOR ADMINISTRATION OF THE BELOW MARKET RATE RENTAL HOUSING AND
HOMEOWNERSHIP PROGRAMS FOR THREE YEARS IN AN AMOUNT NOT TO EXCEED $125,000 PER YEAR
RECOMMENDATION:
Staff recommends that the City Council adopt the resolution authorizing the City Manager to enter into a professional services agreement with the Marin Housing Authority for administration of the below market rate rental housing and homeownership programs for three years in an amount not to exceed $125,000 per year.
BACKGROUND:
The San Rafael General Plan 2040 contains provisions for the construction and preservation of both affordable ownership and rental housing units in San Rafael. To ensure compliance with City affordable housing policies, the City has contracted with the Marin Housing Authority for many years to administer the City’s Below Market Rate (BMR) Ownership and Rental Housing Programs. Through this partnership, the City benefits from Marin Housing Authority’s expertise in housing management and compliance. To continue monitoring existing and future BMR units, the City needs to initiate a new professional services agreement with Marin Housing Authority.
On February 17, 2026, Marin Housing Authority presented a program update to the City Council Housing and Economic Development Subcommittee, including Mayor Kate Colin and Councilmember Eli Hill, describing the current and projected unit portfolio, the services that Marin Housing provides, who the program serves, and how it has evolved based on changes in the housing market and other factors.
ANALYSIS:
This new agreement with Marin Housing Authority will include administrative duties for both the BMR Rental and Ownership Housing Programs for a term of three years (2025-2028).
SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 2
BMR Homeownership Program
Under the agreement, the Marin Housing Authority services include coordination with the City and developer on the initial pricing and sale of each BMR unit, full resale services, annual compliance monitoring, and case-by-case enforcement to address violations. The annual cost is $850 per homeownership unit. The program currently includes 111 homeownership units across 22 complexes.
The number of homeownership units is not projected to increase over the term of the agreement due to limited ownership projects in the City’s development pipeline and the expiration of affordability restrictions on some older units in the portfolio. The affordability term varies by unit age, with some older units having a term of just 30 years. More recent BMR homeownership units have terms of 55 years or in perpetuity.
The City has not previously recovered costs for the homeownership program; however, going forward, the Marin Housing Authority will include a fee for new BMR homeowners to help recover costs of compliance monitoring and administration.
BMR Rental Program
Under the agreement, the Marin Housing Authority will monitor developments with BMR units, calculate and update allowable income schedules, review tenant income certifications, answer questions from renters and landlords, bill and collect monitoring and certification fees, and ensure compliance with affordable housing program requirements. The program currently includes approximately 750 rental units across 42 complexes. The number of BMR rental units in the portfolio is projected to increase based on the City’s development pipeline; however, most of the anticipated BMR units are in market-rate developments, which pay an annual monitoring fee.
The City will pay $25 per rental unit for 100% affordable housing projects that are deed-restricted through an award from the City’s Affordable Housing Trust Fund. Under California state law, cities are not permitted to charge a local compliance monitoring fee on 100% affordable housing developments that are already subject to a regulatory monitoring agreement with the state.
Staff proposes a not-to-exceed cap of $125,000 per year to provide sufficient funding for the administration and monitoring of both programs.
FISCAL IMPACT:
The cost of the proposed agreement over the three-year term is not to exceed $125,000 per year. The agreement will be funded through the Housing Division’s General Fund budget. For Fiscal Year 2025- 2026, these services will be funded through the Housing Division’s existing budget.
OPTIONS:
The City Council has the following options to consider in this matter:
1. Adopt the resolution;
2. Adopt the resolution with modifications;
3. Direct staff to return with more information; or
4. Take no action.
RECOMMENDED ACTION:
Staff recommends that the City Council adopt the resolution authorizing the City Manager to enter into a professional services agreement with the Marin Housing Authority for the administration of the below market rate rental housing and homeownership programs for three years in an amount not to exceed $125,000 per year.
ATTACHMENTS:
1. Resolution
2. Professional Services Agreement
RESOLUTION NO.
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN RAFAEL AUTHORIZING THE CITY
MANAGER TO ENTER INTO A PROFESSIONAL SERVICES AGREEMENT WITH MARIN HOUSING
AUTHORITY FOR ADMINISTRATION OF THE BELOW MARKET RATE RENTAL HOUSING AND HOMEOWNERSHIP PROGRAMS FOR THREE YEARS IN AN AMOUNT NOT TO EXCEED $125,000
PER YEAR
WHEREAS, the City of San Rafael General Plan contains policies to encourage affordable housing units for very low-, low- and moderate-income households in residential projects; and WHEREAS, the City of San Rafael provides grants and loans to affordable housing projects from the City’s Affordable Housing Trust Fund; and
WHEREAS, such affordable units provided by developers to comply with the General Plan or funded through the Affordable Housing Trust Fund are known as Below Market Rate Housing (“BMR”) units, and each developer of a BMR unit executes enforceable restrictions so that both ownership and rental units remain affordable over time; and
WHEREAS, for many years, the City of San Rafael has hired Marin Housing Authority to administer the City’s BMR Ownership and Rental Housing Programs; and WHEREAS, the City of San Rafael desires to assure that the existing and future BMR units will remain as a housing resource for future generations by allocating funds for the management of the BMR Ownership and Rental Housing Programs; and
WHEREAS, the Community and Economic Development Department (“CED”) wishes to initiate a new professional services agreement with Marin Housing to ensure the administration and monitoring of existing and future BMR units for a three-year term; and WHEREAS, for this professional services agreement with Marin Housing Authority, CED will fund the cost of monitoring BMR units in affordable rental housing projects and ownership BMR units, as well as the cost of enforcement services, from the Housing Division General Fund budget; and WHEREAS, Marin Housing Authority will bill and collect the Annual Monitoring Fee from property owners to cover the cost of monitoring BMR units in market-rate residential rental projects; NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of San Rafael authorizes the City Manager or their designee to execute a professional services agreement with Marin Housing Authority for Fiscal Year 2025-2026 through Fiscal Year 2027-2028 in an amount not to exceed $125,000 per year.
FURTHER RESOLVED, that the City Council further authorizes the City Manager or their designee to utilize funding already appropriated to the Community and Economic Development Department to fund any work performed under the above-referenced professional services agreement in Fiscal Year 2025-2026; and
I, LINDSAY LARA, Clerk of the City of San Rafael, hereby certify that the foregoing resolution was duly and regularly introduced and adopted at a regular meeting of the City Council of said City held on Monday, the 18th day of May 2026, by the following vote, to wit:
AYES: Councilmembers:
NOES: Councilmembers:
ABSENT: Councilmembers:
LINDSAY LARA, City Clerk