October 28, 2024 Council NOFA Review Committee

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[00:00:10] Member Lucas Ramirez: Or live. Okay, thank you. Go ahead and call the meeting order at 307 at 8 AM. Uh, and I'll go ahead and start the roll call council member Ramos. Here. Count the number hits. Yeah. And share Ramirez is here. This meeting is being conducted with a virtual component and is being recorded. If requested, translation services in Spanish are available virtually and in person. If you are joining virtually and need interpretation in Spanish, please, please press the interpretation button in Zoom, and select the appropriate language. Public comment can also be submitted in Spanish. And we have no members of the public, uh, joining in person. Uh, we'll move to item 3, approval of the minutes, uh, a motion, uh, is in order to approve the minutes. I

[00:01:08] Unknown Speaker: make a motion to approve the, you know, committee meeting minutes of June 17th, 2024. Fantastic. And there are no members of the public participating virtually. that right? No members of the public participant. No, no. Okay, thank you. So with no members of the public, I will go ahead and vote on the motion to approve the minutes on favor. I passes unanimously. Now we'll move to item 4 oral communications for the public. I'm guessing there are still no members of the front. So we'll move on to a 5.one consideration of charities housing notice of funding availability proposal for 57 to 67 East Evelyn Avenue whenever you're ready.

[00:01:55] Harsha Ramchandani: Good afternoon, NoFA Review Committee. Today's staff will be presenting the proposal submitted by Charities Housing for a fully affordable housing project at 5767 East Evelyn Avenue. My name is Harsha Ramchandani, Housing Officer, and joining me is my colleague, Deanna Talavera, senior housing officer. Julie Barnard, affordable housing manager, and Wayne Chen housing director are also present this afternoon. From the developer team, we have Marvel Ang, director of housing development, and Andy Leaf, senior project manager, joining us here today. Monte Espino from David Baker Architects is attending via Zoom. Marvel and Andy have prepared comments and would like to address the committee after staff's presentation. The agenda this afternoon covers a brief background of the city's notice of funding availability or NOFA process, an overview of the proposed project submitted by charities housing, including next steps and staff's recommendation for the committee's consideration. The city released an OFA in February 2014. It is an over-the-counter NoFA and applications are reviewed for funding consideration on a 1st come 1st serve basis. Since then, the city council has appropriated approximately 1490000 for the construction or rehabilitation of 11 fully affordable housing projects, which has led to a combined total of 927 units. Funding for the NoFA includes various city and federal sources, such as the city's housing impact fees, BMR in Loo fees, CDBG and home grants. In recent years, staff has also sought to leverage city funds and has applied for federal and state grants. Charities submitted their NoFA application on July 14, 2024, requesting 180000 in city funding. Following their application and request, staff conducted due diligence process, the due diligence process to evaluate the project's eligibility and viability. The project offers units at deep affordability levels, including a significant number of family sized units, incorporates sustainable design elements, maximizes external funding to leverage city funds, and implements the city's live work preference, where possible under funding and fair housing laws. Charities also participated in one community meeting as part of the coordinated site planning process, and held another as part of their NoFA application. Specifically to gather input about their side plan. As noted at our last meeting in June, staff has updated the review process for NoFA applications, and has incorporated streamlining elements for this project, including an Excel-based template for the application, and balancing project review with determining feasibility of the project development. With the goal being to streamline, but be thorough. I now turn it over to Deanna for the rest of the presentation. I apologize, I have. Charities housing acquired the 2.2 acre site at 5767 East Evelyn Avenue in February 2022 with plans to redevelop it into affordable housing. The property is adjacent to the city owned site at 87 East Evelyn. The charity site is located on the corner of Evelyn Avenue and state Route 85, and a portion of the site is currently used as a commercial office space. This property is adjacent to the city owned site, which will be developed by affirmed housing, who was selected following a competitive RFP process. Both developers have collaborated on a joint site planning process, which included several planning elements that will be discussed later in the presentation. Both the sites were rezoned through the housing element process from general industrial to high density residential. And out on it over to my colleague, Deanna.

[00:05:55] Deanna Talavera: Thanks, Harsha. So I'm gonna just give an overview of the charities housing, no application. As Harsham mentioned, they submitted their no application on July 14th, 2024. And they went through the no for review process that she described. Um, if you're looking at this rendering, you'll see that their development will be 5 stories tall, it'll feature 141 affordable housing units, rental, um, with 2 manager units. It'll serve households between 30 to 60% of the AMI. And um, we should note that half of the units will be uh, 2 and 3 bedrooms, which will accommodate larger families. Um, charities housing also plans to allocate 25% of their units or 36 units for rapid rehousing or a similar county led programming. Uh, program. Um, these programs target households or individuals at 30% of the AMI and specifically support households that have faced uh, short-term homelessness. In addition, the project will include 105 parking spaces for their residents, and incorporate several sustainable design features, like electric heat pumps, energy efficient lighting, and appliances, EV parking, and native landscaping with drip irrigation. Lastly, charities housing has committed to prioritizing households that live or work in Mountain View. Applying for this applying this preference as much as possible within the limits, as Harsha mentioned, um, set by external funding sources and fair housing loss. So here you'll see, um, an image of their community and amenity spaces, um, charities design their community with amenities that really focus on engagement, recreation, and well-being. As you can see here on the slide. The 1st floor will feature a community gathering room. Along with the small activity room for workshops and group activities. Um, To support the resident's health, there will also be an on-site gym. The 1st floor will also include a dedicated area for resident services. Um, outdoors, the development incorporates various amenity spaces, such as a children's play area, landscaped courtyard, picnic and barbecue areas, providing plenty of options for recreation and socialization. Um, As we mentioned, charities housing, um, engaged in a coordinated site planning effort with their neighbor, affirmed housing, who is developing the site, uh, next door, which is a city owned site. Um, This coordinated site planning effort began in December of 2023. The coordinated effort brought together city staff, both development and both design teams. Staff and the teams met bi-weekly until August 2024, which allowed for a pretty significant period of collaboration. This effort has allowed both developers to work closely with city staff, making significant progress on various planning elements. And as a result, these projects are a lot further along than most NoFA projects are at this stage. Um, They have been extensively reviewed by staff from planning, buyer, public works, and community services. Some of the key design and planning elements that emerge from this process are listed on this slide and I'll briefly speak to each of them. So 1st landscape and streetscape. The architecture, landscape, and engineering teams from both developers work closely together. On the layout of open spaces, tree preservation and public streetscape improvements. This was to ensure a cohesive approach. Um, they even engage with the same architect. I'm sorry, arborist and landscape architects. Next trees. Both teams, charities and affirmed, work with the same consultant, to assess trees on both sites, and this consultant also collaborated closely with the city's arborist, to guide decisions on which trees to retain, to remove. Um, they considered factors like tree health and the viability of transplant. Charities indicated that they are committed to preserving as many trees as possible. And any that can't be preserved will be replaced, according to city codes, with the strategy focused on maintaining the existing trees, planting new ones, and integrating green infrastructure throughout their site. So moving on to parking and circulation. Um, a goal of the coordinated site plan was to enhance uh, safe bike and pedestrian access along East Evelyn Avenue. Um, and through the developments, to accomplish this, charities planned on positioning the main pedestrian entrances, um, Toward the shared open space between affirmed and charities. Um, they'll provide 105 parking spaces located on the end of their site. And importantly, they've coordinated with affirmed on a shared vehicular access that comes off of pioneer way. Having traffic and vehicle entrances off of Pioneer will minimize conflicts with pedestrian and bicycle pathways that are planned along East Evelyn Avenue. And uh, they also work together on joint on-site utilities and fire access. So both teams, again, collaborated with the same civil engineer and utility consultant to design for shared utility corridors to ensure adequate fire service, um, and access for service vehicles like trash pickups. Charities will continue to work closely with the firm to establish these shared utilities, uh, corridors and, um, access as their project plans of love. Lastly, resident services, um, both charities and, uh, affirmed housing plan on sharing the same resident services provider, Catholic charities, charities housing, and Catholic charities fall under the same umbrella. Um, and charities, uh, charities, housing handles, um, Development, while Catholic charities handles resident services and property management. So the plan is for them to have a shared residence services coordinator, who will connect residents to community resources, organize community building events and develop educational programs on topics like health, nutrition, and financial skills. These services are provided at no cost to residence. So all of the programs, classes, and workshops will rotate between the 2 sites. That's the plan for now. Both development teams will, um, promote these classes and courses to their residents during initial lease up and will continue to communicate, um, via email and postings throughout their development. Um, Overall, this coordinated effort really set a strong foundation for both development teams. So as we mentioned, charity submitted their NoFA application, um, and they requested $18000000 in city funding. So if we look at the staff analysis and recommendation here, um, this project is eligible for funding. It does align with the city's affordable housing priorities and the no far requirements. The city currently has approximately $36000000 in unencumbered housing funds available. We anticipate that between both developments along Evelyn Avenue will draw down on this 36000000000 and will uh, $19.30000000 between both sites, leaving around $16000000 in the city's housing fund. The $16000000 is anticipated to be deployed for the 2 land dedication sites that we anticipate over the next few years. Due to our limited housing funds. Staff recommends reserving about $11300000 for development, construction, and long-term financing of the charity site rather than the $180000000 they request. Out of this total. We're recommending that $130000000 be appropriated immediately for early pre-development activities, and $5000000 be appropriated immediately for acquisition funding. The remaining $5000000 for construction and permanent financing will be reserved now and appropriated later. Charity housing, like many affordable housing developers, is facing financial pressures. They purchased their site for $18000000 in February of 2022 using external financing, and are currently paying about $51,000 in monthly interest, which is offset by about $31,000 in rentally. The early $5000000 city acquisition loan would reduce their external financing and lower their overall monthly payments by around $15,000. They estimate this will save them approximately $360,000 overall in overall development costs. So this creative approach to deploying our fund sooner allows the developer to save on overall development expenses. The city's loans will include our standard low and no interest loan terms, to enhance project feasibility. Um, and we will secure our loans against the property with a deed of trust. It's also important to note that the city's, uh, underwriting guidelines allow for up to $1300000 for early pre-development and acquisition activities, with the flexibility to exceed that if necessary. So the limit of $1300000 was put in place to mitigate risk, since early funding of projects, uh, These projects typically face uncertainties. Charities, however, has a strong track record of successful projects, making them a reliable partner, and staff, along with the city's consultant team, has thoroughly assessed the project's financial viability. Um, so in summary, staff recommends using the flexibility in the city's underwriting guidelines to allocate 6.300000 of the 11.3 that we're recommending for pre-development and acquisition funding exceeding the standard $1300000 cap. Um, So here's a high level overview of the development's overall funding structure. Um, the city's contribution is expected to be around $79,000 per unit, aligning with the anticipated funding per unit that the neighboring Evelyn Lot development will receive. That

[00:16:27] Member Emily Ann Ramos: development is providing 268 units.

[00:16:31] Deanna Talavera: This equitable funding approach ensures that both charities and affirmed housing receive fair support as both projects are being developed in coordination with each other along East Evelyn Avenue. Securing public funding at all levels has become increasingly challenging due to the depletion of measure A funding. The recent removal of the $2000000000 regional funding measure, and intense competition for state and federal tax credits. Um, However, despite these hurdles, charities has developed a strategy to secure financing through a mix of public and private sources listed here. Uh, the total development cost is estimated at approximately $1360000 for about $957,000 per unit, which aligns with current market conditions. Um, so next steps, um, if the NoFA committee, um, agrees to forward the funding recommendation, it'll go to the city council on December 17th, 2024. Um, charities will continue to concurrently pursue entitlements for the project. They've already submitted or they plan. sorry, they plan on submitting a formal SV 35 application in November. Um, this does not compel the council to make any recommendation. They are pursuing this entitlement, um, regardless of the council's recommendation here today. Um, SB 35 is uh, a ministerial approval process, so the project will be reviewed uh, processed and approved, um, internally by staff. We don't anticipate having to go to council for anything. Um, they, Or the plan is for them to receive their SV 35 application approval in February of 2025 and to start construction in October of 20, I'm sorry, to get their building permits October 2026. They'll begin construction December 2026 and complete construction if everything goes according to plan. August 2028. So here we have the recommendation for the NoFA committee. Which is to forward your recommendation to the city council to fund the charity's Affordable Housing Project at 57. Uh, 67 East Evelyn Avenue as follows. Reserve $11300000 over on city funds for the development, construction, and long-term financing of the project, of which 6.3 will be made a 1000000 will be made immediately available for early pre-development activities. And we have provided some alternatives that the uh, committee can consider if they'd like. Thank you. We also have, as Harsha mentioned, the development team here who would like to make a few comments. So Andy Leaf, Marvel from Charities. Good

[00:19:32] Andy Leaf: afternoon committee members, staff. As DNS said, my name is Andy Leaf with charities housing. We like to thank you for considering our application. And we appreciate the city's enthusiastic participation in producing affordable housing in your city. As you know, Charities recently received funding. Well, a couple years ago for 1265 Montecito. And as you all know, I think that project is under construction. And so we're hoping that we have a similar process and path forward here at 57 East Evelyn.

[00:20:13] Andy Leaf: We're looking forward to leveraging any the funding that the city provides. so that we can go out and obtain tax credits, ASIC and other sources, and bring the project to fruition. Like to thank the housing staff for working with us over the last year or so. As we work through design and financing scenarios, and helping to facilitate our collaboration with affirmed housing, our joint design process. And that. Includes my prepared statement, and we are here to answer any questions that you may have. We should clap. And stay are we good? Thanks,

[00:20:57] Deanna Talavera: Andy. So we're all available to answer questions from the committee. As needed, as is the developer team. We also have planning. Um, so the planner assigned to this project, Ella is joining virtually, and she'll be promoted shortly if you guys have any questions about the SB 35 process or their, uh, planning related elements.

[00:21:19] Member Lucas Ramirez: Thank you very much. Are there any questions from committee members? I

[00:21:25] Unknown Speaker: asked my questions when I...

[00:21:28] Member Lucas Ramirez: I supp- I think there probably is a requirement to disclose. Oh, yes. Yes, I met. I

[00:21:33] Unknown Speaker: met earlier today with the...

[00:21:36] Member Lucas Ramirez: Do you have a chance to meet the other?

[00:21:38] Member Emily Ann Ramos: Not about this project by ZM often. I

[00:21:42] Member Lucas Ramirez: also had an opportunity to meet with the applicant. So, if there are no questions,

[00:21:46] Member Lucas Ramirez: and there are no members of the public present to... So, no members of the public. You're projecting, then we'll proceed to deliberation and action. We are scheduled to be here till five. Any comments?

[00:22:07] Member Emily Ann Ramos: Deliberations, Emma. Well, this is my 1st, like, actual noble review committee, thanks. I'm actually really kind of excited. Um, I don't see anything really controversial. I mean, other than like, I would love to just give them more money, but I understand that we might not have that kind of money to give right now. Um. But yeah, I'm happy to make the motion to move forward staff's recommendation. There a second.

[00:22:35] Member Pat Showalter: I'm always positive about David Baker project, so. So I, with that in mind, I second. Okay,

[00:22:43] Member Lucas Ramirez: so we might be out of here very quickly. I'll be supporting the motion. Just very quickly. I want to express my appreciation. I think the committee's appreciation both to staff for the work and evaluating the project in advance of this meeting, putting together a very thoughtful proposal to the applicant for working well with staff and also the adjacent property owner affirmed. I know the master planning process is not easy. You're working with a very challenging, constrained piece of property. And I'm actually very impressed with what you've been able to do with it. So I'm just appreciative and excited to help deliver the project. There are no other comments or questions than, uh, we'll vote on the motion to, uh, approve the, the staff recommendation, passes unanimously. Um, thank you very much.

[00:23:36] Member Emily Ann Ramos: Is that a record? I do feel like we should tap for a 2nd time.

[00:23:44] Member Lucas Ramirez: And that will go to the council in December, right? See you soon. Yes. Um, and we'll proceed to item 6, committee staff, comments, questions, and committee reports. Are there any? No. Um, do you know if there will be another NoFoot committee meeting this year?

[00:24:04] Deanna Talavera: Um, no, the charities housing project was the only project we have slated to go to NoFA, um, unless we get some, uh, new information from any of our existing pipeline projects that requires us to come back. Yeah, that would be the only when we anticipate. As you know, the affirmed housing project is going through a separate process outside of the NoFA. Um, process as a product of being city on site.

[00:24:32] Member Lucas Ramirez: So no additional meetings dissipated this year. Um, the minutes cover the discussion that we had about changes to process. Was that, are you expecting to come back to the Nova Committee to finalize anything or is that was the only opportunity we had to make changes?

[00:24:52] Deanna Talavera: So we are right now working on incorporating some of those updates. So, um, uh, charities housing was our guinea pig with our template-based pro forma and actually, um, thank them for their patience as they provided a lot of, like, feedback and iterative, like, back and forth with our consultant teams. So we are now working on taking our NoFA application online. So we're working, um, with a platform called soon grants, um, who is helping us with that. And as, uh, it finalizes and the pieces come together, we'll probably come back to the Nofoot committee. Possibly, in the new year or something. Just,

[00:25:32] Wayne Chen: yeah, just to clarify, um, the housing element, time frame for completing the no for review was June, um, June of this year. So we've completed that review, and now the next step is just implementation. And so Deanna was describing implementation, um, to the extent that, you know, there might be some updates here and there, but there's, um, not sort of bring back in terms of other things.

[00:25:57] Member Lucas Ramirez: The the policy work by the notebook, uh, committee is concluded. Correct. Okay, so that would just be reviewing applications as they roll in.

[00:26:06] Deanna Talavera: Oh, I'm sorry. If we can send notices, you know, once the, um, the application is live, so updates to the committee, but there, we really took your feedback and recommendations, and as Wayne mentioned, are now just in the implementation phase. Okay,

[00:26:19] Member Lucas Ramirez: okay, that's helpful to understand. I don't want to burden you with it. I was curious to know what the end result looks like. Um, but I don't think there's any expectation that you go out of your way to help us understand what changes were made. Um, you did mention, um, I think a couple of land dedications that you're anticipating, uh, will come to us with some, some urgency, I guess. which projects are you, or which sites are those? Um,

[00:26:49] Wayne Chen: well, we know we have, um, a couple of, a couple in our 12 project pipeline that we've been, uh, evaluating, so the team might have been referring, um, you know, either to the, the Sobrado land dedication site in North Bay Shore, um, or the, um, East Westman precise plant sites. I mean, that's that's part of our project pipelines. Yes. Um, So, those are the main ones, unless that, I, I think. Yeah, those are those

[00:27:15] Deanna Talavera: are the ones we were referring to, as we mentioned, are, like what we're trying to, uh, strategically use our funds for. we know those are coming up

[00:27:26] Member Lucas Ramirez: Fair enough. I'm not sure I have confidence in either of those opportunities. So I'd be curious to know if you have other opportunities that we might want to consider, um, if we need to look at prioritization, since I don't know if, either Google Master Plan will move forward or even if Sobrado is gonna, I know they're struggling with their phase two, right? Which is when we would receive the landed occasion. I

[00:27:53] Wayne Chen: believe we've already, the site's already been deeded over to the city, uh, as part of the satisfaction of that project, um, the market rate project. And then the East Westman precise plan will just continue to monitor the monitor that. We have enough, you know, work on the pipeline projects, just keep working on those and uh, be strategic in the way we, um, I think about future land dedication sites. So I think we have some flexibility there. We'll keep monitoring the projects and work with our existing pipeline. Okay. Thank you. Any other questions? Okay.

[00:28:26] Member Lucas Ramirez: Well, then we will move on to item 7. Adjournment. Thank you all very much for your word. See you next year. All right. Thank you so much. Thank you.

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