Title
a. Support and recommend that the Board of Supervisors approve and authorize the County Purchasing Agent, or designee, to execute a Letter of Agreement (LOA) with the Central California Alliance for Health (Alliance) to accept an Alliance Housing Fund award in an amount not to exceed $3,222,262 for the Salinas Housing Advancement, Resources & Education (SHARE) Center Reconfiguration Project, consisting of the development of twelve (12) non-congregate family sleeping cabins and a designated recuperative care area of up to thirty (30) beds, for a funding term of thirty-nine (39) months from the effective date of the LOA, substantially in the form attached and subject to final approval as to form by the Office of the County Counsel;
b. Support and recommend that the Board of Supervisors authorize the County Purchasing Agent, or designee, to execute and record a ten (10) year Declaration of Restrictive Covenants, as required by the LOA, against the 1.585-acre portion of County property at 845 East Laurel Drive, Salinas (Assessor’s Parcel Number 003-851-043) on which the SHARE Center is located, substantially in the form attached as Exhibit 4 to the LOA;
c. Support and recommend that the Board of Supervisors adopt a resolution amending the Fiscal Year 2026-27 Adopted Budget for the County Administrative Office, Homelessness Strategies and Initiatives Division, to increase expenditure appropriations by $1,611,131 in General Fund 1001, Appropriation Unit 105008, Expenditure Category 72605 - Construction in Progress, financed by an increase of $1,611,131 in estimated revenues in General Fund 1001, Appropriation Unit 105008, Revenue Category 44000 - Intergovernmental Revenues, Account 44620 - Other Governmental Agencies, representing the Alliance Housing Fund award (4/5ths vote required); and
d. Provide further direction as necessary.
Report
RECOMMENDATION:
It is recommended that the Budget Committee:
a. Support and recommend that the Board of Supervisors approve and authorize the County Purchasing Agent, or designee, to execute a Letter of Agreement (LOA) with the Central California Alliance for Health (Alliance) to accept an Alliance Housing Fund award in an amount not to exceed $3,222,262 for the Salinas Housing Advancement, Resources & Education (SHARE) Center Reconfiguration Project, consisting of the development of twelve (12) non-congregate family sleeping cabins and a designated recuperative care area of up to thirty (30) beds, for a funding term of thirty-nine (39) months from the effective date of the LOA, substantially in the form attached and subject to final approval as to form by the Office of the County Counsel;
b. Support and recommend that the Board of Supervisors authorize the County Purchasing Agent, or designee, to execute and record a ten (10) year Declaration of Restrictive Covenants, as required by the LOA, against the 1.585-acre portion of County property at 845 East Laurel Drive, Salinas (Assessor’s Parcel Number 003-851-043) on which the SHARE Center is located, substantially in the form attached as Exhibit 4 to the LOA;
c. Support and recommend that the Board of Supervisors adopt a resolution amending the Fiscal Year 2026-27 Adopted Budget for the County Administrative Office, Homelessness Strategies and Initiatives Division, to increase expenditure appropriations by $1,611,131 in General Fund 1001, Appropriation Unit 105008, Expenditure Category 72605 - Construction in Progress, financed by an increase of $1,611,131 in estimated revenues in General Fund 1001, Appropriation Unit 105008, Revenue Category 44000 - Intergovernmental Revenues, Account 44620 - Other Governmental Agencies, representing the Alliance Housing Fund award (4/5ths vote required); and
d. Provide further direction as necessary.
SUMMARY:
The County Administrative Office, Homelessness Strategies and Initiatives Division (CAO-HSI) requests Budget Committee review and support of a Central California Alliance for Health (Alliance) Housing Fund award of up to $3,222,262 for the Salinas Housing Advancement, Resources & Education (SHARE) Center Reconfiguration Project (Project), and of the related budget action. The Project, located at 845 East Laurel Drive in Salinas, will develop twelve (12) non-congregate family sleeping cabins and a designated recuperative care area of up to thirty (30) beds for people experiencing homelessness who need a safe place to recover after a hospital stay.
The Alliance award will be matched by $3,222,262 in Whole Person Care Incentive funds committed by the Department of Health Services (Health Department) under an executed Interdepartmental Memorandum (IDM), for a total initial construction budget of $6,444,524. The recommended budget action is fully offset by Alliance revenue and requires no additional General Fund contribution.
This item is time sensitive. The Alliance’s October 5, 2026, award letter requires a fully executed LOA by November 30, 2026; otherwise, the Alliance may withdraw the award and reallocate the funds. Because the Budget Committee meets once a month, the October 28, 2026, meeting is the only opportunity for Committee review before the Board of Supervisors considers the LOA and budget resolution on November 17, 2026. The County and the Alliance are still finalizing the LOA terms, as described below, so the recommended actions authorize execution of an LOA substantially in the form attached.
DISCUSSION:
The SHARE Center is a 128-bed, low-barrier housing navigation center at 845 East Laurel Drive in Salinas that provides interim shelter and supportive services to individuals and families experiencing homelessness. The County of Monterey and the City of Salinas jointly support SHARE Center operations and facility management under their Memorandum of Understanding.
Families with children currently sleep in the SHARE Center’s congregate space alongside unaccompanied adults, and people experiencing homelessness are often discharged from the hospital with no safe place to finish recovering. To address both needs, CAO-HSI and the Health Department have partnered to reconfigure the SHARE Center:
• Family cabins: Twelve (12) modular, non-congregate sleeping cabins along the exterior of the facility, each with a private bathroom, replacing the current congregate sleeping arrangement for families. At least two (2) cabins will meet Americans with Disabilities Act accessibility requirements.
• Recuperative care: A designated, physically separated area with up to thirty (30) beds in fifteen (15) two-bed rooms, for Medi-Cal enrolled or eligible individuals experiencing homelessness who are medically ready for discharge, primarily from Natividad, but who do not have a safe place to complete their recovery.
Recuperative care participants will be connected to medical, behavioral health, Enhanced Care Management, Community Supports, benefits, and housing navigation services. When recuperative care is no longer medically necessary, participants may move to another SHARE Center bed or to other appropriate housing or care rather than being discharged to the street.
Alliance Housing Fund award. On October 1, 2026, CAO-HSI submitted a revised Letter of Intent (LOI) requesting $3,222,262 for the Project. On October 5, 2026, the Alliance approved a contingent award of $3,222,262, which replaces the Alliance’s prior reservation of funds for the discontinued Medical Recuperative Care Center project under the terminated Letter of Agreement dated August 8, 2025. The award is contingent on execution of the LOA by November 30, 2026, Alliance approval of a final Project Plan, completion of project milestones, and compliance with the LOA.
Letter of Agreement. The LOA provides a thirty-nine (39) month funding term from its effective date. Payments are made after each phase is completed and documented. Under the current draft:
• Phase One - Planning and Design (completion date December 31, 2026; 50% of the award): final Project Plan with funding documentation and initial construction budget, design plans, community outreach, and building permit applications.
• Phase Two - Procurement and Construction Start (completion date November 30, 2027; 30% of the award): environmental review, building permits, modular unit and construction procurement, final construction budget, and start of construction.
• Phase Three - Construction Completion and Occupancy (completion date January 31, 2028; 20% of the award): construction completion, certificate of occupancy, a recuperative care prioritization process, and service availability.
After Phase Three, the County must maintain the recuperative care beds for Medi-Cal eligible individuals for a ten (10) year useful life, through January 31, 2038, and submit an annual attestation to the Alliance each March 31. The LOA also requires the County to execute and record a Declaration of Restrictive Covenants that names the Alliance as a third-party beneficiary. The Declaration will be recorded against the same 1.585-acre portion of APN 003-851-043 that is subject to the County’s 2019 Homeless Emergency Aid Program (HEAP) deed restriction (Document No. 2019052407), using the County Surveyor’s existing legal description.
Status of LOA negotiations. The County has returned redline comments on the Alliance’s draft LOA, and CAO-HSI, the Office of the County Counsel, and the Alliance are working to finalize the terms. The main open items are:
• Requiring submission of complete building permit applications in Phase One and moving permit issuance to Phase Two, so the December 31, 2026 Phase One date can be met given the Board approval timeline and recent updates to the cabin layout.
• Confirming that both the family cabins and the recuperative care area are eligible uses of Housing Fund dollars.
• Aligning the Medi-Cal occupancy requirement with the LOI (up to thirty (30) recuperative care beds; the award letter refers to at least thirty) and limiting it to the recuperative care area rather than the full 128-bed SHARE Center.
• Confirming that the County is not required to have ten (10) years of operating funding committed as a condition of the award.
• Mutual indemnification, and the terms and recording timeline of the Declaration of Restrictive Covenants.
Roles and responsibilities. The County will be responsible for developing and operating the Project. Under the IDM executed August 11, 2026, CAO-HSI will administer the Alliance award, coordinate project implementation, manage agreements, monitor expenditures, and ensure compliance with funding requirements. The Health Department will provide the local match and support fiscal monitoring and reporting. The Department of Public Works, Facilities and Parks (PWFP) will manage design and construction through a Reimbursable Services Agreement funded by the Health Department match. Day-to-day operation of the SHARE Center, including the recuperative care program, will be carried out by the County’s subcontracted SHARE Center operator.
Long-term operational sustainability. The County anticipates sustaining SHARE Center operations throughout the Project's required ten (10) year useful life through a combination of state grant funding, cost-sharing with the City of Salinas, and potential Medi-Cal reimbursement revenue. These anticipated funding sources are expected to support the long-term financial sustainability of the SHARE Center and the County's ability to maintain the required recuperative care capacity throughout the ten-year useful life. CAO-HSI will continue to evaluate funding availability and operating costs annually to ensure the facility remains financially sustainable.
Budget Committee review. This item is presented under Section 7 of the Budget Committee Charter because it appropriates a newly awarded grant (Section 7.C), exceeds $150,000 (Section 7.D), and has budgetary implications tied to a capital project (Section 7.H).
OTHER AGENCY INVOLVEMENT/COMMITTEE ACTIONS:
CAO-HSI has coordinated with the Alliance, the City of Salinas, Community Human Services, the Health Department, and PWFP in developing and funding the Project. The CAO Budget & Analysis Division reviewed this report. The Office of the County Counsel is reviewing the LOA and the Declaration of Restrictive Covenants and will approve the final documents and budget resolution as to form. The Auditor-Controller’s Office will review the budget resolution.
Community engagement. On September 16, 2026, CAO-HSI conducted a community engagement public meeting at the Health Department between 5:30 p.m. to 7:30 p.m. with the community and neighbors to discuss the SHARE Center Reconfiguration Project. Community engagement and outreach is a Phase One milestone under the LOA, and CAO-HSI will report outreach results to the Alliance.
This item has not been reviewed by another Board of Supervisors committee.
FINANCING:
The recommended budget action increases Fiscal Year 2026-27 expenditure appropriations and estimated revenues in CAO-HSI General Fund 1001, Appropriation Unit 105008, by $1,611,131, as described in Recommendation c. The action is fully offset by Alliance revenue and requires no additional General Fund contribution.
Project funding sources. Alliance Housing Fund award: $3,222,262. Health Department Whole Person Care Incentive funds (local match): $3,222,262. Total initial construction budget: $6,444,524. The Health Department match is managed through the IDM and a Reimbursable Services Agreement with PWFP and is not part of this budget action.
Timing of revenue. Alliance funds are paid after each phase is completed and documented: 50% ($1,611,131) after Phase One, anticipated in FY 2026-27; 30% ($966,678.60) after Phase Two and 20% ($644,452.40) after Phase Three, both anticipated in FY 2027-28. Project costs will be incurred before each payment is received. Any unspent appropriation at year end will be requested in the FY 2027-28 budget.
Use of funds. Alliance funds may be used only for eligible capital costs, including design, site work, modular units, construction, and furnishings, fixtures, and equipment. Ongoing operations and services will be funded separately through CalAIM Enhanced Care Management, Community Supports and recuperative care reimbursement, Medicare billing by the operator, other state grants, and City of Salinas contributions. No ongoing General Fund commitment is requested with this action.
Fiscal risk. Under the LOA, the Alliance may withhold payments or require repayment of funds already disbursed if the County misses a milestone, discontinues the Project, or does not maintain the Medi-Cal occupancy requirement for the ten-year useful life. The LOA allows milestone dates to be modified with the Alliance’s written approval and provides a 90-day negotiation period if federal or state changes to Medi-Cal make the recuperative care program infeasible. CAO-HSI is negotiating additional protections as described above.
Link to the Strategic Plan:
<https://www.countyofmonterey.gov/home/showdocument?id=139569>
Prepared by: Sarah Federico, Management Analyst III, CAO-HSI Division, ext. 5341
Reviewed by: Roxanne Wilson, Homeless Services Director, CAO-HSI Division, ext. 5445
Approved by: Michael Beaton, Assistant County Administrative Officer, ext. 3835
Attachments:
Draft Alliance Housing Fund Letter of Agreement, including Exhibit 4 - Declaration of Restrictive Covenants (under negotiation)
Alliance Housing Fund Award Letter dated October 5, 2026
SHARE Center Reconfiguration Letter of Intent dated October 1, 2026
Executed CAO-HSI/Health Department Interdepartmental Memorandum dated August 11, 2026
Draft Budget Resolution - to be included with the Board report