A | Consideration and Approval of Budget Adjustment: Fiscal Year 2023-24 Budget Adjustment for Housing Incentive Program Funds with possible allocation of incentive funds for affordable housing within Block 1 of the Timber Sky Final Block Plat. | ||||||
Mr. Clifton offered comments as to why the request was before Council. There was a letter that suggested that the city’s involvement in the matter was a result of some effective lobbying efforts by a private developer, and he wanted to clarify. The City Manager’s office had first-hand engagement in many projects and programs over the years. He referenced the following projects:
Before the Council there were two things. First, the approval of the transfer of a budget appropriation from the General Fund contingency in the amount of $1.1 million dollars. The second was to authorize staff to approve the allocation of incentive funds out of the Affordable Housing Incentive Program for the waiver and reimbursement of fees for affordable housing to be constructed in Block One of the Timber Sky Final Block Plat. He noted that the allocation was entirely separate from the bond fund. The Incentive Policy had been in place for a while but had not been budgeted regularly which was why the reallocation was being requested for approval by Council. Lastly, Mr. Clifton emphasized that the request to Council was not at all a product of lobbying by any developer. The request came to Council because staff felt that it was the right thing to do, and they felt that the project was a good candidate for the assistance the policy offered. Mr. Clifton turned the discussion over to Finance Director Brandi Suda who stated that the request was to approve a Fiscal Year 2023-24 budget adjustment to reallocate $1.1 million of the city’s General Fund contingency funds to enhance funding available for the Affordable Housing Incentive Program. Ms. Suda noted that per state statute, the city was unable to increase the total budget once it had been adopted. However, cities were able to reallocate budget appropriations between departments so long as money was available and if it was in the public interest. The money was available and as part of the Fiscal Year 2023-24 adopted budget, Council approved a contingency set aside within the General Fund. A portion of the contingency fund related to the Public Safety Personnel Retirement System was set aside in accordance with the Contingency Reserve Policy. The Police and Fire Plans were both at about 105% funding and are not anticipated to need to utilize the $1.1 million. In past years when funding had not been needed, it had been repurposed for other one-time needs in a future fiscal year. In regard to the public interest and need requirement, Ms. Suda stated that the declared Housing Emergency demonstrated the need. The Affordable Housing Incentive Program was provided $130,000 of new money in the current fiscal year however, staff had received several requests to utilize the funding. Staff continued to discuss the ability to increase the funding for future years but instead of waiting for the next fiscal year staff desired to seek Council approval for a mid-year reallocation. Councilmember Matthews stated that she would support the reallocation. The policy was in place to incentivize builders to bring affordable housing projects and market-rate units. There has been a declared Housing Crisis and the project would bring 224 affordable rental units to the market. The incentive fund needed to be better funded in future years. Councilmember House voiced her support for the reallocation. She asked what the process would be to better fund the incentive fund more permanently. Mr. Clifton stated that the matter had already been discussed with the Budget Team, and the intent was to see the fund be funded on a regular basis. The amount was unknown but that would be determined through the annual budget process. Lindsay Schube, on behalf of the developer, offered words of gratitude for the funding of the incentive fund. She indicated that the fund, coupled with code modifications were a great tool for Council to incentivize affordable housing. She clarified that the project would bring 221 affordable units and that they were nearing shovel-ready status. Mayor Daggett asked what the Area Median Income (AMI) percentage the project would serve along with the length of affordability. Ms. Schube stated that the project would serve 60% AMI or less, and the state funding is tied to a 15-year term. However, the city had requested a 30-year affordability term which they agreed to. Councilmember Harris stated that the housing crisis was a problem for the entire city. She was grateful for the project that would ensure 221 affordable units for thirty years. Andy Fernandez addressed Council and spoke in opposition to the item. Councilmember Sweet offered appreciation to the City Manager and staff for advancing the matter to Council. The community continued to struggle with housing and businesses were having difficulty recruiting employees due to the cost of housing. Councilmember House also noted her appreciation to all involved. She appreciated the creative approach to find a solution. 221 units were not insignificant, and they are seeing possibilities for the future. Councilmember McCarthy indicated that he was very supportive. Vice Mayor Aslan stated that he was also supportive. It was something to be celebrated, and he was proud to be part of the team that brought the project to fruition. Mayor Daggett echoed the sentiments of appreciation and the creative approach to find a solution. |
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Moved by Councilmember Lori Matthews, seconded by Councilmember Khara House to approve the transfer of budget appropriations from the General Fund Contingency account to the Housing and Community Services Fund's Affordable Housing Incentives program in the amount of $1,100,000. | |||||||
Vote: 7 - 0 - Unanimously | |||||||
Moved by Councilmember Jim McCarthy, seconded by Councilmember Miranda Sweet to direct City Manager and staff to approve the allocation of incentive funds (waiver and/or reimbursement of applicable fees as set forth in the Incentive Policy for Affordable Housing) for affordable housing to be constructed in Block 1 of the Timber Sky Final Block Plat. | |||||||
Vote: 7 - 0 - Unanimously | |||||||