Title
American Rescue Plan Act Affordable Housing Gap Financing Program - Request to Award Morgan and Associates (Ordinance S-49895)
Description
Request to authorize the City Manager, or his designee, to award up to $2 million in American Rescue Plan Act (ARPA) funds for gap funding, enter into ARPA Affordable Housing Loan Program agreements, and take all actions and execute all documents to complete the loan with Morgan and Associates. Further request the City Controller to disburse all funds for the life of the contract.
Report
Summary
The ARPA Affordable Housing Gap Financing program will provide the developer, Morgan and Associates, with a low-interest loan to subsidize the creation of affordable units serving households at or below 65 percent of the Area Median Income for a minimum period of 20 years. The ownership entity for this project is Acacia Heights III, LLC. The Acacia Heights III project is located at 615 W. Pierson St. and plans to provide a total of 68 affordable units, 41 of which will be ARPA funded units.
Procurement Information
On Feb. 7, 2023, the Housing Department issued a Call for Interest (CFI) seeking proposals for developments in need of gap financing for the creation, rehabilitation or acquisition of affordable rental housing based on the Housing Phoenix Plan. Eight proposals were received, and four were deemed unresponsive. An evaluation committee, comprised of two City staff members and one representative from a state agency, evaluated the proposals based on a 1,000-point scale on the following criteria: Project Feasibility; Project Readiness; Efficiency/Resiliency; Affordability; Cost Effectiveness; and Developer Experience. All four projects were recommended for funding, as follows:
- Chicanos Por La Causa - 25th@Bell Apartments: $896,564
- Morgan and Associates - Acacia Heights III: $2 million
- Partners for Housing Solutions - Mesquite Terrace Apartments: $2 million
- Ulysses Development - 12th Street Apartments: $1 million
Financial Impact
This program is funded by ARPA, and there is no impact to the General Fund.
Loan execution is anticipated for Fiscal Year 2023-24.
Concurrence/Previous Council Action
On June 16, 2020, the Phoenix City Council approved the Housing Phoenix Plan which set the goal of creating or preserving 50,000 homes by 2030.
On June 7, 2022, the Phoenix City Council approved the City's ARPA Strategic Plan for the second tranche of funds, and included an allocation of $12 million for the Affordable Housing Program, $6 million of which would be used towards gap financing.
Location
615 W. Pierson St.
Council District: 4
Department
Responsible Department
This item is submitted by Deputy City Manager Gina Montes and the Housing Department.