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Santa Rosa approves $38 million in loans for affordable housing

The Santa Rosa Housing Authority has approved the use of about $38 million in federal disaster relief funds to build hundreds of new affordable homes in the next few years.

A short-handed Housing Authority on Monday afternoon voted to loan $38,353,107 to the developers of five projects in Santa Rosa that initially offer the promise of 377 units combined, almost all restricted to low-income residents.

The largest single award, notable for both its circumstances and its size, went to the first phase of the 3575 Mendocino Avenue project, which when fully built envisions 532 homes on the site of the former Journey’s End mobile home park. Linda Adrian, a former park resident and vocal supporter of the redevelopment effort, praised the $11.9 million award to the project, which would create 370 market-rate apartments as well as 162 units in an affordable development to replace the 160 Journey’s End homes, most of which were destroyed in the 2017 Tubbs fire.

“At the moment, I’m still living in a temporary apartment which is only 320 square feet, and I’ve been waiting for this — for Journey’s End to be rebuilt so I can move back in,” said Adrian, who lived at the park for 25 years.

The funds represent a bittersweet windfall for a city in desperate need for additional affordable places to live. While the money offers a rare chance to boost several large projects simultaneously, Santa Rosa wouldn’t have had access to the funds if it hadn’t suffered through the enormous disaster of the Tubbs fire.

The city received the money last year via state officials from the U.S. Department of Housing and Urban Development due to the damage inflicted upon Santa Rosa by the Tubbs fire, which exacerbated the existing shortage of affordable housing by destroying more than 3,000 homes citywide. The city formally opened the application process for the funds in November, less than one month after it stuck an agreement with state officials to release the money.

The city received 17 applications, four of which were deemed incomplete. Two were later withdrawn. The 11 remaining applications, representing requests for about $80.3 million — more than twice what the city had to offer — were reviewed by a panel of two members of the Housing Authority, vice chair Diane Test and commissioner Steve Burke, and two members of the City Council, John Sawyer and Tom Schwedhelm, guided by city staff.

Their unanimous recommendations went in support of five projects, three of which are backed at least in part by Burbank Housing, the Santa Rosa-based affordable housing developer. According to city documents, the projects, along with their loan amounts, total costs, number of units and estimated month of construction completion, are:

  • Phase one of 3575 Mendocino Avenue; $11.9 million loan; $56.7 million development cost; 94 units; March 2023.
  • The Cannery at Railroad Square; $10.3 million; $86.8 million development cost; 129 units; June 2023.
  • Phase one of Caritas Homes; $8.9 million loan; $39.8 million development cost; 64 units; December 2022.
  • Burbank Avenue Apartments; $5 million loan; $38 million development cost; 64 units; July 2023.
  • Linda Tunis Senior Apartments; $2.1 million loan; $9.4 million development cost; 26 units; March 2022.

The loans include affordability guarantees for 55 years from the date of initial occupancy and 3% annual interest rates deferred for that same amount of time, according to city documents.

Burbank Housing is a development partner in the 3575 Mendocino, Caritas Homes and Burbank Avenue Apartments projects. The Cannery project has been brought forward by the John Stewart Company, and the Linda Tunis project — named for a former Journey’s End resident who perished in the Tubbs fire — is backed by Petaluma Ecumenical Properties, or PEP Housing.

“This is in fact a major step forward in chipping away at the housing units that are needed and demanded, specifically affordable units, for the city of Santa Rosa,” said Efren Carrillo, director of housing development and government affairs for Burbank Housing.

The two non-Burbank housing projects both agreed to reduce the size of the loans they requested from the Housing Authority, according to city staff. There was no indication the three Burbank Housing projects had to do so.

The Housing Authority ordinarily includes seven members, including two tenant commissioners. However, when it met on Monday, the authority lacked both tenant positions, two of its five current commissioners were serving on expired terms, and one had to recuse himself to avoid a potential conflict of interest.

All but one of the units for each project, or 372 units total, are income-restricted to some degree. The other five units are unrestricted and are intended to house on-site managers of the projects.

The pre-award review took into account the projects’ ability to secure planning approval and other committed sources of funding, conduct environmental reviews, total costs per unit and estimated construction start and end dates, said Nicole Rathbun, a city housing program specialist.

“We were really focusing on project readiness and wanting to get these units in the community as quickly as possible,” Rathbun said.

You can reach Staff Writer Will Schmitt at 707-521-5207 or will.schmitt@pressdemocrat.com. On Twitter @wsreports.

Editor’s Note: Efren Carrillo was misidentified in a previous version of this article.

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