Title
Receive a preliminary response to Referral Number 2024.12 regarding the potential use of 1220 Natividad Road to provide capital funding for the Monterey County Local Housing Trust Fund (MCLHTF)
Body
RECOMMENDATION:
It is recommended that the Board of Supervisors receive a report and provide direction to staff to consider the potential commercial use of 1220 Natividad Road to provide funding for the MCLHTF as part of the Facilities Master Planning process.
SUMMARY:
On September 12, 2024, Supervisor Alejo submitted a referral (Referral No. 2024.12) directing the department of Housing and Community Development (HCD) to examine the feasibility of commercializing County owned property at 1220 Natividad Road, Salinas, as a means of providing an ongoing source of capital for the Monterey County Local Housing Trust Fund (MCLHTF).
The State of California established the (LHTF) program to provide matching funds to jurisdictions and regions that have established local housing trust funds. The LHTF provides a dollar-for-dollar match for qualified local funds up to $5,000,000. Qualified local funds include locally generated affordable housing dollars, general fund or private contributions, and the fair market value of County property pledged for affordable housing development. The LHTF specifically excludes funds already restricted by state or federal law or grant regulations (except for PLHA funds) from being counted as part of the qualified match.
On May 20, 2022, the Board of Supervisors authorized the creation of the MCLHTF to support the County’s efforts to create and retain affordable housing. In May 2022 and May 2023, the Board adopted resolutions #22-100 and #23-169 pledging a portion of the County’s Permanent Local Housing Allocation (PLHA) grant, American Recovery Act funds, General Fund, the Inclusionary Housing Fund, the redevelopment housing successor agency low-moderate-income housing trust fund, and 5-acres at 855 E. Laurel Dr where Eden Housing is proposing to develop 132-units of affordable housing. The value of these assets was estimated at $10.04 million with ongoing annual revenue of $100,000. The MCLHTF currently has $7.231 million available but only $3.881 million qualifies for a LHTF matching grant. The decrease in available funding is the result of loans to EAH Housing, Inc. for Greenfield Commons and Lightfighter Village in Marina.
Referral No. 2024.12 requests that HCD consider the possibility of leasing County owned land at 1220 Natividad Road, Salinas (the former print shop site), for commercial use, with the proceeds of such lease going to the MCLHTF. These proceeds could then qualify for matching grant funds through the State LHTF program. This funding would be used to support qualified projects under the LHTF program such as retaining existing affordable housing stock, building affordable housing projects, or funding homeless shelters in the County.
HCD has coordinated with Public Works, Facilities, and Parks (PWFP) on this referral as it involves use of County facilities. PWFP is currently undertaking a Countywide Facilities Master Planning effort which involves studying current and future uses of county owned properties.
In September 24, 2024, the Board of Supervisors authorized PWFP to retain the consulting firm of Gensler to prepare a Countywide Facilities Master Plan. The purpose of this Plan is to study the effective use of the County’s current real estate portfolio as well as plan for the development of future facilities and identify potential surplus land no longer needed by the County. The project includes a review of campuses at Alisal Government Center, East Laurel Facility Yard, Schilling Place Complex, Monterey Courthouse (Aguajito Road) and Life Foundation building as well as a highest and best use analysis of collective properties in and around Natividad Road, East Laurel Drive and Constitution Boulevard in Salinas. In addition to Supervisor Alejo’s referral, the Health Department expressed an interest in using 1220 Natividad Road in the future.
PWFP has coordinated with Gensler to confirm that we can add to the scope of the Facilities Master Planning effort to include consideration of leasing 1220 Natividad Road to help fund the MCLHTF. With the suggested approach the Facilities Master Planning efforts can study a range of uses including the proposed commercial lease for Board consideration. The final Facilities Master Plan is expected to be presented to the Board of Supervisors in June 2025 inclusive of a market analysis for the commercial lease. This would be the most cost effective and expeditious way to incorporate the analysis requested as alternatives would involve securing separate consulting services to provide a standalone study outside the comprehensive master planning process.
OTHER AGENCY INVOLVEMENT:
Public Works, Facilities, and Parks is responsible for preparing the Facilities Master Plan. HCD has reached out to the Health Department and the Sheriff’s Office to alert them of this referral. The Sheriff’s Office indicated that they no longer have plans for the site and the Health Department is interested in opportunities for future uses at the site but appreciate the interest in converting it to an income generating project.
FINANCING:
There is no impact on the General Fund. The Facilities Master Plan is already funded. There maybe additional costs in managing the process to competitively lease the property that will need to be funded separately.
BOARD OF SUPERVISORS STRATEGIC INITIATIVES:
The MCLHTF supports the Board’s Economic Development, Health & Human Services, Infrastructure, and Public Safety initiatives by providing a local source of financing for affordable housing projects that reduce overcrowding, leading to improved public health and safety outcomes and supporting local employer efforts to retain qualified workers by supporting construction of affordable housing.
X Economic Development
X Administration
X Health & Human Services
X Infrastructure
X Public Safety
Prepared by: Darby Marshall, Housing Program Manager, x5391
Approved by: Craig Spencer, Director of Housing and Community Development