REPORT TO THE CITY COUNCIL
FROM: JENNIFER CLARK, Director
Planning and Development Department
PHILIP SKEI, Assistant Director
Planning and Development Department
BY: CRYSTAL SILVA, Senior Management Analyst
Homeless Services Division
SUBJECT
Title
Actions related to a City-owned property of approximately 0.98 acres located at 3876 N. Blackstone Avenue (APN 436-260-22) (Council District 4):
1. ***RESOLUTION - Adopt the 16th Amendment to the Annual Appropriation Resolution No. 2025-179 Appropriating $348,000 from the Encampment Resolution Funds, Round 3 (ERF-3) to Support the City Studios Project (Requires Five Affirmative Votes) (Subject to Mayor’s Veto)
2. Approve an agreement with Fresno Mission for the City Studios project, located at 3876 N. Blackstone Avenue (APN 436-260-22), designating 12 units for families and youth households that have been served through Encampment Resolution Fund grant.
Body
RECOMMENDATION
Staff recommends that the City Council approve an amendment to the Annual Appropriations Resolution No. 2025-179, appropriating $348,000 from ERF-3 to support the City Studios project.
Additionally, staff recommends approval of an agreement with Fresno Mission to designate 12 units for families and youth households served through the Encampment Resolution Fund grant. The agreement term will run from November 1, 2025, through June 30, 2026, in an amount not to exceed $348,000, funded through ERF-3.
Staff further requests that the City Council authorize the City Manager, or designee, to execute all implementing documents and agreements necessary to carry out the intent of this action.
EXECUTIVE SUMMARY
On April 20, 2023, the City Council authorized a joint application with Fresno Mission to the California Department of Housing and Community Development (HCD) for the Homekey Round 3 Program. The purpose of the Homekey 3 application was to acquire, rehabilitate, and operate the City Studios Project located at the former Travelodge Motel at 3876 North Blackstone Avenue, also known as 1780 East Saginaw Way (APN 436-260-22), converting a 44-room motel into 34 permanent affordable housing units for individuals and youth experiencing or at-risk of homelessness. Upon construction completion, Fresno Mission Communities will act as the owner, operator, and service provider for the Project.
Included in the City Council’s action authorizing application, an enforceable funding commitment of future City funding not to exceed $5,000,000 was also made to support the project’s capital needs. Due to formulaic constraints in the Homekey application the project was not able to include in the grant budget all of the funds needed for initial start-up costs, including operational ramp-up, furnishings, and laundry equipment. These funds were planned to be contributed to this project from the time of application and are eligible for this use based upon the City’s ERF-3 grant award. This is the only funding the project will require of the City.
The City of Fresno (City) is proposing the allocation of $348,000 ERF-3 to expand access to permanent housing for families and youth households served through ERF. As part of the agreement, Fresno Mission, the project operator, will designate 12 units specifically for ERF clients through June 30, 2026.
To facilitate funding for the City Studios project, an AAR must be submitted to appropriate $348,000 that was not originally allocated in the FY2025-26 budget.
BACKGROUND
On April 20, 2023, the City Council authorized a joint application with Fresno Mission to the California Department of Housing and Community Development (HCD) for the Homekey Round 3 Program. As part of that action, an enforceable funding commitment of future City funding not to exceed $5,000,000 was also made to support the project’s capital needs. The purpose of the Homekey 3 application was to acquire, rehabilitate, and operate the City Studios Project located at the former Travelodge Motel at 3876 North Blackstone Avenue, also known as 1780 East Saginaw Way (APN 436-260-22) (Property), converting a 44-room motel into 34 permanent affordable housing units for individuals and youth experiencing or at-risk of homelessness. Upon construction completion, Fresno Mission Communities will act as the owner, operator, and service provider for the Project.
On February 14, 2024, the City and Fresno Mission were awarded $9,598,131 in Homekey Round 3 Program Funds for the Project. This funding will provide 34 units of permanent affordable housing, including 21 studio apartments, 9 one-bedroom units, 2 two-bedroom units, and 2 three-bedroom units. Of these, 23 units will be reserved for individuals at-risk of homelessness, 10 units for homeless youth or youth at-risk of homelessness, and one unit for an on-site manager. On April 18, 2024, City Council authorized the acceptance of $9,598,131 in Homekey Round 3 Program Funds from HCD for the Project, to be used for eligible capital and operating costs and expenses.
On November 27, 2023, The California Interagency Council on Homelessness (Cal ICH) released a Notice of Funding Availability for the Encampment Resolution Fund Round 3 (ERF-3) program. This initiative was designed to support local jurisdictions in addressing the wellness, safety, and long-term housing needs of individuals residing in encampments. On April 19, 2024 the City received an ERF-3R award of $10,926,075.78.
To further support the development of permanent supportive housing, the Homeless Services Division, is recommending the allocation of $348,000 in ERF-3 funds as funding for the City Studios project. The project operator, Fresno Mission, will designate 12 units specifically for ERF clients through June 30, 2026.
ENVIRONMENTAL FINDINGS
On September 28, 2023, the City Council adopted a finding of Categorical Exemption pursuant to Sections 15301/Class 1 (Existing Facilities) and 15332/Class 32 (In-fill Development) of the California Environmental Quality Act (CEQA) Guidelines. Staff reviewed the project and determined that none of the exceptions to Categorical Exemptions set forth in CEQA Guidelines, Section 15300.2, apply to this project.
LOCAL PREFERENCE
Local preference is not applicable due to the use of State Funds.
FISCAL IMPACT
The general fund will not be impacted, due to the City utilizing state Encampment Resolution Funds to support the project.
Attachment:
16th Amendment to AAR No. 2025-179
Fresno Mission Agreement - City Studios