Council backs set-aside to keep Farro center operations funded while lease and services are negotiated

The City Council unanimously approved a staff recommendation on June 23 to reserve up to $350,000 to support the Farro center ' a local homeless-services site ' while negotiations continue over lease arrangements and operational roles.

Homeless and housing services manager Carrie Payne told council that staff anticipates a worst-case contribution of $100,000 from the state's Public Housing Agency allocation and that the city can make up the remainder this year with a combination of Measure I savings, CALAM contract leverage for case management, and salary savings. Payne said the city also expects to negotiate a new lease structure in which SB ACT (an operator) may take the lease directly with the landlord but that the city could continue a service contract to secure required operational standards.

"We are confident that we will have $100,000 from PHA to contribute," Payne said, but added staff wants the city to identify the full-year funding scenario so that negotiations with the landlord and SB ACT are not constrained by lack of clarity. Council members sought clarification about whether the city would remain the leaseholder if SB ACT could not reach terms with the landlord; staff said the city could retain the lease if necessary and return to council.

Council and staff agreed to return on July 28 with the proposed lease and service agreement and detailed startup costs; in the meantime the council authorized the funding set-aside and directed staff to continue negotiations. The vote was unanimous.

What happens next: staff will return with a contract and lease proposal July 28; council will then decide whether to authorize an ongoing appropriation or condition approval on operational terms.