To: Board of Supervisors
From: John Kopchik, Director, Conservation and Development
Report Title: Approve FY 2024/25 Recommendations to Award Measure X Housing Fund and Permanent Local Housing Allocation Funds
☒Recommendation of the County Administrator ☐ Recommendation of Board Committee
RECOMMENDATIONS:
APPROVE the Department of Conservation and Development’s FY 2024/25 recommendations for the allocation of $11,702,500 in Measure X Housing Funds and $3,526,423 in Permanent Local Housing Allocation (PLHA) funds, as recommended by the Department of Conservation and Development Director.
FISCAL IMPACT:
There is no General Fund impact. Measure X funds are part of a countywide, 20-year ½ cent sales tax approved by Contra Costa County voters on November 20, 2020. The County has already been awarded the PLHA funding, which will cover the cost of funding these recommendations and the County’s administrative costs up to 5% of the total grant.
BACKGROUND:
Measure X
Measure X is a countywide 20-year ½ cent sales tax approved by Contra Costa County voters on November 3, 2020. The ballot measure language stated the intent of Measure X is “to keep Contra Costa’s regional hospital open and staffed; fund community health centers, provide timely fire and emergency response; support crucial safety-net services; invest in early childhood services; protect vulnerable populations; and for other essential County services.”
On November 16, 2021, the County Board of Supervisors approved the allocation of Measure X funding to establish a new funding source for housing-related activities, now termed the Measure X Housing Fund (MX Housing Fund). Eligible projects under the MX Housing Fund for project funds to be distributed through the Affordable Housing Program include:
• Affordable housing for populations earning up to 80 percent Area Median Income (AMI), focusing on 50 percent AMI and below.
• Acquisition, pre-development, construction, rehabilitation, and operating reserve funds.
• Innovation pilot programs and capacity-building technical assistance for affordable housing activities (acquisition, pre-development, construction, rehabilitation, and operating reserve funds).
• Grant writing for affordable housing activities (acquisition, pre-development, construction, rehabilitation, and operating and reserve funds).
PLHA
PLHA is a state program with entitlement and competitive components intended to fund more affordable housing. The State designated Contra Costa County as the administrator of the entitlement grant award for the Contra Costa “Urban County,” which includes the unincorporated communities and all the incorporated cities except for the cities of Antioch, Concord, Pittsburg, and Walnut Creek, which have their own entitlements. The PLHA funds may be used to:
• Increase the supply of housing for households at or below 80 percent AMI;
• Facilitate housing affordability, particularly for lower- and moderate-income households; and
• Promote projects and programs to meet the local government’s unmet share of regional housing needs allocation.
The allocation of PLHA included in the 2024/25 Notice of Funding Availability (NOFA) is $3,712,024 with five percent set aside for Program Administration, leaving $3,526,423 available to allocated to eligible projects.
FY 2024/25 NOFA/RFP Process
On October 12, 2023, a Notice of Funding Availability (NOFA) for County affordable housing funds (federal and local sources, including Measure X and PLHA) and a Request for Proposals (RFP) notice was released and published in all editions of the Contra Costa Times and posted on the County’s DCD website soliciting applications for the development, acquisition, and/or rehabilitation of affordable housing throughout the County. On November 2, 2023, a public Housing “Kick-Off” Meeting was held virtually by County DCD staff via Zoom to provide information to prospective applicants on the NOFA/RFP. County staff also held virtual “office hours” on five separate occasions in November and December 2023 to provide additional technical assistance to prospective applicants.
The County received 23 applications by the December 18, 2023, the deadline for both federal and local funds. During the months of January through April 2024 staff assessed and analyzed the applications, which included interviews of all applicants that submitted complete applications. After reviewing and analyzing the applications and conducting interviews with the applicants, DCD staff prepared a report and recommendations for the various affordable housing funding programs to present to the County’s Affordable Housing Finance Committee (AHFC), the advisory committee to the Board of Supervisors that reviews staff’s recommendations on affordable housing financing activities.
A meeting of the AHFC was scheduled for Wednesday, June 5, 2024; however, the meeting was unable to be held due to a lack of quorum of the committee members. There was not enough time to schedule and hold another AHFC meeting prior to the Board of Supervisors meeting on Tuesday, June 25, 2024, where all federal and local funding are being considered for approval to meet federal or state deadlines. Therefore, DCD staff’s recommendations for MX Housing Funds and PLHA funds, as shown in Attachment A, are being forwarded to the Board of Supervisors for consideration, as recommended by the Department of Conservation and Development Director, to meet federal or state deadlines. The allocations of federal funds for capital housing activities are being considered in a separate Board action on the Board’s June 25, 2024 meeting agenda.
Recommended MX Housing Fund/PLHA Awards for Capital Housing Projects
Choice in Aging
Developer: Satellite Affordable Housing Associates
Location: Pleasant Hill
Recommended Award Amount: $7,931,542 Measure X funds
Contingencies for Approval: All other financing commitments secured by December 31, 2024; FY 2024/25 Measure X funds committed, as evidenced by an executed loan, by August 31, 2025. Measure X funds will be recaptured by January 2025 if significant progress is not made to meet the commitment deadline of August 31, 2025.
Project Summary: An 82-unit senior development including one manager’s unit and units set aside for homeless veterans and affordable to households earning 30%-60% Area Median Income (AMI).
Esperanza Place Phase 2
Developer: Habitat for Humanity East Bay/Silicon Valley
Location: Walnut Creek
Recommended Award Amount: $1,000,000 Measure X funds
Contingencies for Approval: Measure X funds committed, as evidenced by an executed loan, by June 30, 2026; Construction of Phase 2 must commence by June 30, 2027.
Project Summary: New construction of 19 for-sale condominium units in Phase 2 of Esperanza Place (a 42-unit condominium project).
Riverhouse Hotel
Developer: Eden Development
Location: Martinez
Recommended Award Amount: $1,000,000 Measure X funds
Contingencies for Approval: Measure X funds committed, as evidenced by an executed loan by June 30, 2026. Construction must commence by June 30, 2027.
Project Summary: The rehabilitation of an existing, occupied 75-apartment development, including two manager’s units, and the conversion of 6 commercial spaces into nine new affordable units.
Village of Hope Pittsburg
Developer: Hope Solutions
Location: Pittsburg
Recommended Award Amount: $1,770,958 Measure X funds
Contingencies: FY 2024/25 Measure X funds committed, as evidenced by an executed loan, by June 30, 2026; Construction must commence by June 30, 2027.
Project Summary: New construction of 15 permanent supportive housing rental units for transitional aged youth.
El Cerrito Plaza Parcel A South
Developers: Related California, Holliday Development, Satellite Affordable Housing Associates
Location: El Cerrito
Recommended Award Amount: $1,876,423 PLHA funds
Contingencies: All other financing commitments secured by December 31, 2025; FY 2024/25 PLHA funds committed, as evidenced by an executed loan, by August 31, 2026; PLHA funds will be recaptured by January 2026 if significant progress is not demonstrated to meet the August 31, 2026, commitment deadline.
Project Summary: The first phase of a multi-phase master plan transit-oriented development in partnership with BART and the City of El Cerrito, for the new construction of 70 rental units for low and very low-income families, including one manager’s unit.
Rumrill Commons
Developers: Novin Development/Community Resident Services, Inc.
Location: San Pablo
Recommended Award Amount: $1,650,000 PLHA funds
Contingencies: PLHA funds committed, as evidenced by an executed loan, by August 31, 2026.
Project Summary: New construction of 40 rental units affordable to households earning 30%-60% Area Median Income, including one manager’s unit.
CONSEQUENCE OF NEGATIVE ACTION:
Negative Action will prevent these affordable housing developers from moving forward with their FY 2024/25 projects. The applicants would have to wait and apply for funds from the County in next year’s funding cycle, which could jeopardize the projects or significantly delay their construction schedules.