Clearlake council authorizes competitive application to help finish Connected Gardens affordable-housing project
April 18, 2024 | Clearlake, Lake County, California
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Clearlake — The city council on April 18 authorized a competitive application to the California Department of Housing and Community Development for the permanent local housing allocation (CPLHA) competitive pot to help finish the Connected Gardens development.
City Manager Alan Flora introduced Resolution 2024-18, which the council approved with minor typographical corrections. Consultant Chris Westlake told the council the CPLHA program is funded from SB 2 recording fees and that approximately $12,500,000 is available statewide in this round. The resolution authorizes up to $5,000,000, though Westlake said the developer and the city currently expect to request about $2.5 million as a gap-filling loan if awarded.
If Clearlake is awarded funds, HCD would enter a standard agreement with the city and the developer as co-applicants; the city would receive the grant and make a residual-receipts loan to the development. Westlake characterized the loans as long-term gap financing, noting they are typically issued as 55-year residual-receipts loans with a 3% simple interest rate.
Resident Margaret Garcia asked why the project was over budget and how long-term financing would affect the city. Staff said cost increases stemmed from unanticipated water and sewer infrastructure upgrades, higher construction interest rates, PG&E and utility delays and slower-than-expected state infrastructure grants — factors that raised project costs and timelines.
Council member Kramer moved to approve Resolution 2024-18, Vice Mayor Overton seconded, and the motion passed unanimously. Staff said the city will finalize the exact request amount before the application deadline (staff cited June 6 as the submittal window) and noted awards will be announced this fall.
The council's approval authorizes city staff to proceed with the CPLHA application and minor clerical corrections to the resolution; formal award and loan terms will depend on HCD's competitive selection process.
City Manager Alan Flora introduced Resolution 2024-18, which the council approved with minor typographical corrections. Consultant Chris Westlake told the council the CPLHA program is funded from SB 2 recording fees and that approximately $12,500,000 is available statewide in this round. The resolution authorizes up to $5,000,000, though Westlake said the developer and the city currently expect to request about $2.5 million as a gap-filling loan if awarded.
If Clearlake is awarded funds, HCD would enter a standard agreement with the city and the developer as co-applicants; the city would receive the grant and make a residual-receipts loan to the development. Westlake characterized the loans as long-term gap financing, noting they are typically issued as 55-year residual-receipts loans with a 3% simple interest rate.
Resident Margaret Garcia asked why the project was over budget and how long-term financing would affect the city. Staff said cost increases stemmed from unanticipated water and sewer infrastructure upgrades, higher construction interest rates, PG&E and utility delays and slower-than-expected state infrastructure grants — factors that raised project costs and timelines.
Council member Kramer moved to approve Resolution 2024-18, Vice Mayor Overton seconded, and the motion passed unanimously. Staff said the city will finalize the exact request amount before the application deadline (staff cited June 6 as the submittal window) and noted awards will be announced this fall.
The council's approval authorizes city staff to proceed with the CPLHA application and minor clerical corrections to the resolution; formal award and loan terms will depend on HCD's competitive selection process.
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