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 Parkview Apartments affordable rental housing project located along the Parkway Drive Corridor, Fresno, CA (Council District 3):
1. ***RESOLUTION - Adopt a Resolution in support of a contribution of City funds in the amount of $6,000,000 and a contribution of three City-owned parcels along the Parkway Drive Corridor to Cesar Chavez Foundation for the development of the Parkview Apartments affordable rental housing project, and authorizing the City Manager, or designee, to execute all necessary documents on behalf of the City (Subject to Mayor’s Veto)
Body
RECOMMENDATION
Staff recommends City Council adopt a Categorical Exemption pursuant to Section 15301 (Class 1) and Section 15332 (Class 32) of the California Environmental Quality Act (CEQA) Guidelines and a Resolution in support of a $6,000,000 contribution of City funds and the contribution of three City-owned parcels along the Parkway Drive Corridor to Cesar Chavez Foundation for the development of the Parkview Apartments affordable rental housing project, and authorizing the City Manager, or designee, to execute all necessary documents on behalf of the City.
EXECUTIVE SUMMARY
The Cesar Chavez Foundation (Developer) is proposing to develop the Parkview Apartments, a 144-unit affordable rental housing project on three City-owned sites located along the Parkway Drive Corridor. The project will consist of both the rehabilitation of existing units and new construction, offering permanent affordable housing options.
Adopting the Resolution will provide a conditional commitment of $6,000,000 in City funds and a contribution of three City-owned parcels to the Developer to support the development of the Parkview Apartments. This contribution of City-owned property, along with the conditional City funding, is contingent upon the full financing of the project and shall terminate on December 31, 2025, with an option to extend for one additional year, subject to certain provisions.
BACKGROUND
The City of Fresno is the fee owner of three parcels located along the Parkway Drive Corridor and more particularly described as 1444 West White Avenue (APN 449-343-07T), 817 North Parkway Drive (APN 449-335-25), and a vacant lot at the northwest corner of North Parkway Drive and West Dennett Avenue (APN 449-321-18) (the Properties). On February 1, 2024, the three City parcels were declared Surplus by City Council through the adoption of Resolution No. 2024-023. In accordance with the Surplus Land Act (SLA), Gov. Code, Sections 54222 et seq., the City is required to make surplus land available for affordable housing prior to considering other uses. Following this, on February 14, 2024, the City released a Notice of Availability/Offer to Sell Surplus Property (Notice) which included the Properties. The Cesar Chavez Foundation responded to the Notice with a letter of interest on February 29, 2024, to acquire the Properties for the development of affordable housing.
The proposed Parkview Apartments project includes the development of 144 affordable housing units, which will consist of the rehabilitation of 53 units into permanent supportive housing and 91 units of newly constructed affordable rental housing (Project). The Project will be split as follows:
• 26 new units of affordable rental housing will be on the vacant 2.21-acre lot at the northwest corner of North Parkway Drive and West Dennett Avenue (APN 449-321-18).
• 65 units will be developed at the former Travel Inn Motel (1444 West White Avenue, APN 449-343-07), converting the 1.55-acre site into newly constructed affordable rental housing.
• 53 units of permanent supportive housing will be created through the rehabilitation of the former Villa Motel located (817 North Parkway Drive, APN 449-335-25), a .83-acre site.
Both the Travel Inn and Villa Motel sites are currently being utilized by the City to provide low-barrier emergency shelter and triage services for individuals experiencing homelessness. The City is deeply committed to assisting people with exiting homelessness and recognizes the critical need for permanent affordable housing to address the ongoing homelessness and housing crises.
To fund the Project, the Developer intends to apply for funding from the State of California Department of Housing and Community Development’s (HCD) Multifamily Super NOFA (MFSN) Program. The City supports this funding application, which will be due to the State around April 2025. In addition to supporting the funding process, the City intends to contribute $6,000,000 in conditional funds to cover construction and rehabilitation costs for the Project; and the City plans to contribute the Properties to the Developer through a long-term ground lease, at a nominal fee of $1 per year for 55 years.
The City’s conditional commitment of funds and contribution of the Properties are contingent on the Developer securing full funding through the MFSN Program and providing evidence of full financing for the Project, in addition to the City obtaining approval of the disposition terms by the California Department of Housing and Community Development (HCD). Once these conditions are met, the City and Developer will formalize an enforceable financing commitment not to exceed $6,000,000 and will execute a 55-years ground lease at $1 per year. This conditional commitment and contribution will expire on December 31, 2025, with an option to extend the Resolution for one year, contingent upon the Developer securing full funding for the Project.
Approval of this Resolution will allow the Developer to complete the funding application process, seek to secure additional funding sources, and provide the City with the necessary evidence that the Project is fully funded. In partnership with Cesar Chavez Foundation, the Parkview Apartments development offers the City an opportunity to repurpose existing and vacant sites into high-quality, permanent affordable rental housing, furthering the City’s efforts to reduce homelessness and increase its affordable housing stock.
ENVIRONMENTAL FINDINGS
This item is not subject to CEQA at this time. Staff will bring forth an Environmental Determination at a later date
LOCAL PREFERENCE
Local preference is not applicable as this action does not involve a bid or an award of a construction or services contract.
FISCAL IMPACT
This action represents the City’s firm commitment of funds to the Project. The City anticipates receiving nominal income from the ground lease, but the action primarily involves the conditional commitment of City funds and the contribution of the surplus parcels.
Attachments:
Resolution for Parkview Apartments