REPORT TO THE CITY COUNCIL
FROM: JENNIFER CLARK, Director
Planning and Development Department
PHILIP SKEI, Assistant Director
Planning and Development Department
BY: JENNIFER DAVIS, Senior Management Analyst
Housing Finance Division
SUBJECT
Title
Actions pertaining to the construction of Sustainable Transportation Infrastructure amenities for an affordable housing project located at 1302 Fulton Street (Council District 3):
1. Adopt a Categorical Exemption pursuant to Section 15268 (Ministerial Projects) of the California Environmental Quality Act (CEQA) Guidelines
2. Approve a Memorandum of Understanding between the City of Fresno and Housing Authority of the City of Fresno for the construction of Sustainable Transportation Infrastructure amenities for 1302 Fulton Street
Body
RECOMMENDATION
Staff recommends the City Council (1) adopt a Categorical Exemption pursuant to Section 15268 (Ministerial Project) of the California Environmental Quality Act (CEQA) Guidelines, and (2) approve the Memorandum of Understanding between the City of Fresno (City) and the Housing Authority of the City of Fresno (Developer) for the construction of Sustainable Transportation Infrastructure (STI) amenities to serve the development at 1302 Fulton Street, contingent upon full funding of the Developer’s Affordable Housing and Sustainable Communities (AHSC) Program application, due May 28, 2025
EXECUTIVE SUMMARY
The project located at 1302 Fulton Street is a $62,000,000 mixed-use development that includes 124 deed-restricted affordable residential rental units and certain Sustainable Transportation Infrastructure (STI) improvements. The STI components aim to reduce environmental impact and improve transportation access for residents by enhancing connectivity to major retail, social services, education, and employment opportunities. The Developer is applying for Round 9 of the California Strategic Growth Council’s Affordable Housing and Sustainable Communities (AHSC) Program to secure funding for the project. To submit a complete application, the City must enter into a Memorandum of Understanding (MOU) with the Developer to construct the STI improvements, should the project be awarded. The application includes a request for up to $15,000,000 to reimburse the City for these infrastructure enhancements.
BACKGROUND
On March 25, 2025, the California Strategic Growth Council (SGC) and the California Department of Housing and Community Development (HCD) issued a Notice of Funding Availability (the AHSC NOFA) under the Affordable Housing and Sustainable Communities (AHSC) Program, established by Senate Bill 862 (2014) and codified under Division 44, Part 1 Chapter 2 of the California Public Resources Code (beginning with Section 75200). The AHSC Program was created to reduce greenhouse gas emissions through projects that implement land use, housing, transportation, and agricultural land preservation practices to support infill and compact development. Funded through the Greenhouse Gas Reduction Fund (GGRF), otherwise known as the California Climate Investments, the AHSC Program funds projects that increase the supply of affordable housing, transportation, and access to other daily needs. The goal of the AHSC Program is to reduce personal vehicle use by funding affordable housing projects that make it easier for residents to get out of their cars and walk, bike, or take public transit. The AHSC Program explicitly funds projects through affordable housing loans, and capital grants for housing-related infrastructure, sustainable transportation infrastructure, transit-related amenities, and other related programs.
In early 2024, the Housing Authority of the City of Fresno (Developer) submitted a comprehensive application to the City’s Affordable Housing Development Notice of Funding Availability (the City NOFA), proposing the Affordable Housing Development (AHD component) strategically located on 0.55 acres of land at 1302 Fulton Street, Fresno, California 93721 (APN: 466-153-14). The project site includes a five-story mixed-use building designed to contribute to Fresno’s vibrant downtown district while providing 124 new deed-restricted affordable residential units. The project aims to foster a sense of community through thoughtfully integrated amenities such as a community room and open space for residents. The project features a diverse mix of housing types, including studios, one-bedroom units, and two-bedroom units, thoughtfully integrated with retail spaces on the ground floor, enhancing both the social and economic landscape of the area. The project intends to address the pressing need for accessible housing for low- and moderate-income families in our community while also being committed to implementing energy-efficiency design strategies that comply with the City of Fresno’s Green Building requirements, ensuring that the development minimizes its environmental impact while proving long-term savings for residents. Moreover, the project will adhere to the City’s Universal Design Ordinance (2008-53), making it accessible and welcoming for individuals of all abilities, thus promoting inclusive housing offerings.
To enhance the infrastructure surrounding the project, the proposed scope of construction includes both on-site and off-site improvements. Emphasis has been placed on creating a community-oriented environment, integrating social spaces that promote connection to the surrounding area. Existing off-site improvements at the sidewalk will remain in place, including sculptures, fountains, and trees. The essential off-site upgrades will facilitate the smooth integration of the new multi-family housing project into the existing urban landscape. The City will develop the Sustainable Transportation Infrastructure (STI) components such as improved walkways, dedicated bike paths, additional bus stops, and improved service frequency along existing bus routes connecting residents to major retail, social services, education, and employment opportunities.
The Developer is applying for Round 9 of the AHSC Program to obtain needed funding to support this affordable housing project. The AHSC application seeks an award to the Developer in an aggregate amount not to exceed $50,000,000 in AHSC Funds consisting of up to $35,000,000 of AHSC affordable housing development loan funds for construction of the housing project; and up to $15,000,000 of AHSC grant funds for the purpose of reimbursing the City for the cost of the STI Improvements. For the Developer to submit a complete AHSC application, the City and Developer are required to enter into a contractual agreement to develop the STI elements of the project, if the project is awarded.
This project represents a vital opportunity for infill new construction in an area that has long sought revitalization, while addressing the city’s need for quality affordable housing by providing 124 new deed-restricted residential units for low- to moderate-income households. Investment in infrastructure such as improved walkways and dedicated bike paths will enhance the city’s downtown area by increasing community safety, promoting social equity, and enhancing the area’s economic viability by creating a better transit area. The completion of this project will assist in bringing the City closer to meeting the housing goals and objectives as outlined in the “One Fresno Housing Strategy” by addressing high-priority local housing needs, supporting economic development through the creation of new affordable housing units, and promoting infill development and infrastructure improvements within the City’s high opportunity zones.
ENVIRONMENTAL FINDINGS
The Planning and Development Department approved Zone Clearance Application No. P24-03984 for property located at 1302 Fulton Street on April 21, 2025. Based on the analysis, the project was determined to be statutorily exempt from the California Environmental Quality Act (CEQA) under Section 15268(a) (Ministerial Projects) of the CEQA Guidelines, which states that Statutory Exemption can be made for ministerial projects.
Under Section 15369 of CEQA Guidelines, “Ministerial” describes a governmental decision involving little or no personal judgment by the public agency as to the manner of carrying out the project. A ministerial decision involves only the use of fixed standards or objective measurements, and the public agency cannot use personal, subjective judgment in deciding whether or how the project should be carried out. The determination of what is "ministerial" can most appropriately be made by the public agency involved based upon its analysis of its own laws, and each public agency should make such determination either as a part of its implementing regulations or on a case-by-case basis which projects are considered exempt from CEQA.
As such, Ministerial projects approved by public agencies are not subject to CEQA (Pub. Res. Code Sec. 21080(b)(1)). None of the project approvals require discretionary review subject to CEQA, including Zone Clearance applications. Further, no exceptions to the Categorical Exemptions under CEQA Guidelines, Section 15300.2, apply to this project and the project is not expected to have a significant environmental impact. A Categorical Exemption has been prepared, and the area is not environmentally sensitive.
LOCAL PREFERENCE
Local preference is not applicable as this Memorandum of Understanding does not include a bid or award of a construction or services contract.
FISCAL IMPACT
If awarded, the City will receive up to $15,000,000 to pay for STI improvements which will be incorporated into the City of Fresno annual budget for the fiscal year(s) in which funds will be available.
Attachments:
P24-03984 Notice of Exemption
Memorandum of Understanding with Housing Authority for Fulton Street Development