DATE: May 9, 2023
TO: Board of Supervisors
SUBMITTED BY: Susan L. Holt, Director, Department of Behavioral Health
SUBJECT: Avalon Commons Revised Resolution, Standard Agreement, Service Agreement, and No Relocation Certification and Indemnification Agreement
RECOMMENDED ACTION(S):
TITLE
1. Adopt revised Resolution authorizing Fresno County’s participation in the California Department of Housing and Community Development Round 4 No Place Like Home Non-Competitive Allocation Program ($2,183,000).
2. Authorize the Chairman to execute the Avalon Commons Standard Agreement 21-NPLH-17356 with the California Department of Housing and Community Development for construction of The Avalon Commons Phase I, LP development, effective upon execution by all parties involved for a 30-year term total not to exceed $2,183,000.
3. Approve and Authorize the Chairman to execute a retroactive Agreement effective April 5, 2023 with Avalon Commons Phase I, LP, that commits the County to make available supportive services for a minimum of 20 years at Avalon Commons, a permanent supportive housing development located at 7521 North Chestnut Avenue, Fresno, CA, a No Place Like Home-Round Four project.
4. Authorize the Chairman to execute Certification Regarding Non-Application of Relocation Benefits and Indemnification Agreement, Avalon Commons Phase I.
REPORT
Approval of the first recommended action will replace a resolution previously adopted by the Board on July 9, 2019, which authorized Fresno County’s participation in the No Place Like Home (NPLH) Competitive Allocation Program.
Approval of the second recommended action will authorize the Chairman to execute the Avalon Commons Standard Agreement for the NPLH project, effective upon execution by the Chairman, Avalon Commons Phase I, LP and the State of California Department of Housing and Community Development for a 30-year term with a total of $2,183,000.
Approval of the third recommended action will fulfill the County’s commitment to make available supportive services to tenants at Avalon Commons Permanent Supportive Housing (PSH) project and authorize the Chairman to execute the Service Agreement with the California Department of Housing and Community Development (HCD) for Avalon Commons. Per NPLH regulations, the Department, via a contracted services provider, is committed to make available supportive services for a minimum of 20 years at NPLH supportive housing developments.
Approval of the fourth recommended action will authorize the Chairman to execute the No Relocation Certificate and Indemnification Agreement with HCD for Avalon Commons. The No Relocation Certificate and Indemnification Agreement identifies that HCD will be held harmless in connection with potential legal costs and liabilities in connection with accepting certification from Fresno Housing Authority (FHA) that permanent or temporary relocation was not necessary under Relocation Law.
There is no Net County Cost associated with the recommended actions. This item pertains to a location in District No. 2.
ALTERNATIVE ACTION(S):
Non-approval of the recommended action would jeopardize the construction timeline of the development from HCD, and data collected during the annual Mental Health Services Act community planning process continually demonstrates increased housing capacity as a top priority in the County.
RETROACTIVE AGREEMENT:
The Standard Agreement and all recommended actions were to be executed prior to the projected loan closure of April 5, 2023. Since FHA did not get the documents to us in time to meet the deadline, FHA has requested the third recommended action, Supportive Services agreement be retroactive.
FISCAL IMPACT:
There is no increase in Net County Cost associated with the recommended actions. The revised resolution and standard agreement authorize the application for the awarded, NPLH funds, totaling $2,183,000. The supportive services will be funded with estimated Short/Doyle Medi-Cal Federal Financial Participation, and Mental Health Realignment funds. The estimated annual budget for the Supportive Services Agreement will be $79,583; or $1,591,660 for 20 years. Sufficient appropriations and estimated revenues will be included in Department of Behavioral Health’s Org 5630 future budget requests.
DISCUSSION:
On July 1, 2016, Governor Brown signed legislation enacting the NPLH Program to dedicate $2 Billion in bond proceeds to invest in the development of PSH for persons in need of mental health services and experiencing Homelessness, Chronic Homelessness, or are At-Risk of Chronic Homelessness. The NPLH legislation was authorized by the California Welfare and Institutions Code, sections 5849 and 5890. The NPLH Program provides capital financing for acquisition, design, construction, rehabilitation, and capitalized operating subsidies to allow California counties to increase capacity of PSH. HCD administers the NPLH Program for California counties for construction of PSH.
On January 29, 2019, the Board approved Resolution No. 19-025 which allowed the County to participate in the NPLH Competitive Allocation Program and Memorandum of Understanding (MOU) No. 19-048, that committed the County’s entire NPLH Non-Competitive Allocation to the FHA for the development of a minimum of 15 PSH units. The MOU established the FHA as a development sponsor/co-applicant with the County for NPLH development applications. On January 30, 2019, the FHA submitted three NLPH Competitive Allocation Program applications to HCD. It is anticipated the County’s NPLH Non-Competitive Allocation, estimated at $2,183,000 will provide supplemental funding to the County’s NPLH Competitive Allocation projects successfully funded by HCD. The County is committed to providing supportive services for a minimum of 20 years to individuals housed in a NPLH PSH development.
On July 9, 2019, the Board approved Resolution No. 19-272 authorizing the County to accept the $2,183,000 Non-Competitive award from HCD, and a Revised Resolution No. 19-273 previously adopted by the Board on January 29, 2019, which authorized Fresno County’s participation in the NPLH Competitive Allocation Program for Avalon Commons Phase I, LP, a permanent supportive housing project partially funded in Round Four of the NPLH Competitive Allocation Program.
Avalon Commons is a permanent supportive housing project partially funded in Round Four of the NPLH Competitive Allocation Program. NPLH provides funding for PSH development for homeless individuals living with Serious Mental Illness (SMI) or youth with Serious Emotional Disorders (SED) and their families. Development of PSH for individuals with SMI or SED will meet the goal set forth in the NPLH Program guidelines for mentally ill homeless individuals to achieve safe, permanent housing with voluntary supportive services.
Avalon Commons was researched and mutually agreed upon by the Department and FHA as acceptable location for PSH which includes the availability of on-site supportive services for tenants. Avalon Commons includes amenities to meet tenant’s needs such as proximity to grocery, post office, bus line, etc. The 30-year agreement term is required by HCD to comply with NPLH Guidelines the County make available supportive services for a minimum of 20-years at the development. FHA is the development sponsor/co-applicant with the County for NPLH development applications. FHA will provide property management services and ownership responsibilities at the development. The County is not a party to the ownership of the development; Avalon Commons Phase I, LP assumes all liability and responsibility for the development. The County’s commitment for the development is for a minimum of 15 PSH units.
Approval of the recommended actions will authorize the Chairman to execute the revised NPLH Resolution, NPLH standard agreement, supportive service agreement, and the No Relocation and Indemnification Agreement for Avalon Commons Phase I, LP. The final Standard Agreement and all recommended actions must be executed prior to the projected loan closure on April 5, 2023. Although the revised resolution states all documents are required for closure, the standard agreement was not received in time to meet the deadline and the project has closed on estoppel pending approval of the standard agreement.
The Supportive Services Agreement with Avalon Commons Phase I, LP is retroactive to April 5, 2023, due to the developments loan closing deadline. The County will make available supportive services for a minimum of 20 years at the permanent supportive housing development located at 7521 North Chestnut Avenue, Fresno, CA, a No Place Like Home-Round Four project.
The No Relocation Certificate and Indemnification Agreement ensures compliance with HCD/NPLH guidelines, which requires the No Relocation Certification and Indemnification Agreement to be returned to HCD. This agreement is a one-way indemnity protecting the State but not Fresno County and is not a normal County practice, but necessary and approved by Risk.
OTHER REVIEWING AGENCIES:
The FHA Board of Directors is aware of the HCD agreement for the NPLH development and will approve the agreements subsequent to execution by the Chairman of the Board of Supervisors, at which time the agreements will be forwarded to HCD for full execution. The Department has informed the County Behavioral Health Board of the HCD NPLH Round Four award for the development of PSH.
REFERENCE MATERIAL:
BAI #39, July 9, 2019
BAI #9, January 29, 2019
ATTACHMENTS INCLUDED AND/OR ON FILE:
On file with Clerk - Revised NPLH Resolution
On file with Clerk - NPLH Standard Agreement
On file with Clerk - Supportive Services Agreement
On file with Clerk - No Relocation and Indemnification Agreement
CAO ANALYST:
Ronald Alexander