Council de‑obligates old housing allocation and approves gap funding for Fairview Terrace to allow construction to proceed

Stockton City Council voted March 31 to de‑obligate $1,614,000 from a 2019 allocation for Sierra Vista Phase 3 after the developer acknowledged the project is not ready to proceed. The action freed funds to support other projects in the city's 2025 NOFA (Notice of Funding Availability) round.

At staff's recommendation, council approved a $2.8 million loan to Mutual Housing for the Fairview Terrace senior housing project to close an immediate financing gap and permit the project to finalize tax‑credit and other funding. Staff and Mutual Housing representatives said Fairview Terrace is scheduled to break ground in April and that the developer needs the gap funding to close on tax‑credit financing and start construction.

Economic Development Director Tina McCarty described the NOFA scoring process: eight proposals were submitted, reviewed by three internal raters and a third‑party underwriting firm, and vetted by an AI scoring assist tool that staff used to check consistency. Staff noted two top scores belonged to projects from the same developer and recommended an either/or $5 million allocation so the developer can pursue the most viable tax‑credit package first.

Council approved the immediate funding for Fairview Terrace and de‑obligation of the Sierra Vista funds; the council directed staff to invite all other NOFA applicants to present at a future meeting so council members could hear further detail before deciding on the remaining recommended allocations.