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Agenda Item
ASR
Control 14-001002 |
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MEETING DATE: |
07/15/14 |
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legal entity taking action: |
Board of Supervisors |
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board of supervisors
district(s): |
1 |
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SUBMITTING
Agency/Department: |
County Executive Office (Approved) |
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Department contact
person(s): |
Scott Mayer (714) 834-3046 |
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Karen Roper (714) 480-2805 |
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Subject: Acquisition of Year-Round
Emergency Shelter and Multi-Service Center Site
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ceo CONCUR |
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Clerk of the Board |
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Concur |
Approved Agreement to Form |
Discussion |
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3 Votes Board Majority |
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Budgeted: Yes |
Current Year Cost:
$3,650,000 |
Annual Cost:
N/A |
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Staffing Impact: No |
# of Positions:
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Sole Source:
No |
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Current Fiscal Year Revenue: N/A
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Prior Board Action: 01/24/2012
#31, 12/10/13 #57 |
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RECOMMENDED ACTION(S):
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1. |
Find that the recommended actions are Categorically Exempt from the provisions of California Environmental Quality Act (CEQA) pursuant to Section 15332 of the CEQA Guidelines. |
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2. |
Approve the Purchase and Sale Agreement with B&N Group, a California General Partnership and JRMV Investments, Inc., a California Corporation in the amount of $3,600,000 for the purchase of property at 1217 E. Normandy Place, Santa Ana, CA. and return two executed copies to the County Executive Office. |
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3 |
Authorize the County Chief Real Estate Officer, or designee, to sign all transactional and escrow documents, including minor modifications that do not materially alter the terms or financial obligations of the transaction, and perform all activities specified under the terms of the Purchase and Sale Agreement and Escrow Instructions including execution of the Grant Deed. |
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4. |
Authorize funding not to exceed $50,000 necessary to conduct due diligence investigations to comply with applicable County ordinances and best practices. |
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5. |
Direct the County Chief Real Estate Officer, or designee, to return to your Board in the event that all Due Diligence investigations regarding the real estate are not completed and the contingencies set forth in the Purchase and Sale Agreement are not fulfilled as set forth therein. |
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SUMMARY:
Approval of the Purchase and Sale Agreement will facilitate the acquisition of a site for a year-round emergency shelter and multi-service center for homeless families and individuals in Orange County.
BACKGROUND INFORMATION:
On January 24, 2012, your Board approved Orange County’s final Ten-Year Plan to End Homelessness (the Plan). To ensure successful implementation of the Plan, your Board established the Commission to End Homelessness (the Commission). The Plan includes goals and implementing strategies to effectively end homelessness in Orange County. More specifically, Goal #3 of the Plan is to improve the efficacy of the emergency shelter and access system. Further, Implementing Strategy #14 of the Plan is to develop year-round permanent emergency shelters to replace the seasonal Armory Emergency Shelter Program. The Commission has four Implementing Groups. Implementing Group #2 focuses on emergency and transitional shelter systems improvement. During 2011, Implementing Group #2 convened multiple community meetings and forums to solicit key stakeholder input regarding policies for year-round emergency shelter development. At its November 18, 2011 meeting, the Commission approved the following policy recommendations.
Commission to End Homelessness Policy Recommendations for Year-Round Emergency Shelter
Each year when the County’s Armory Emergency Shelter Program closes for the season, Orange County immediately loses 400 emergency shelter beds. To address this issue, it is critical to transition the seasonal Armory Emergency Shelter Program to a year-round emergency shelter program. To accomplish this objective, the following policies should guide the development of a year-round emergency shelter.
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a. |
Consider multiple sites throughout the County to meet the needs of each local community. These sites should be strategically developed after the initial opening of a year-round centrally accessible site(s). |
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b. |
Work with cities on how the County shelter effort coordinates with efforts of other jurisdictions working on the same issues. |
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Co-locate and/or have access to multi-service or “day” center to provide critical services needed by clients. |
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Combine permanent supportive housing with an emergency shelter and other components to create a sustainable model. |
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Allow the lowest possible thresholds to enable an individual to receive services to create the ideal emergency shelter. The only barrier should be if the behavior of the individual threatens the well-being of other participants. Individuals with addiction and mental health disorders must be able to receive services in this type of emergency shelter. |
As part of the January 24, 2012 Ten-Year Plan to End Homelessness agenda item, your Board approved the aforementioned policy recommendations for a year-round emergency shelter. In addition to these policy recommendations, it is important to outline other key initiatives that led to the identification of a site in the City of Santa Ana:
City of Santa Ana Emergency Shelter SB2 Zone:
During the months of May 2012 through July 2013, the City of Santa Ana conducted an extensive stakeholder outreach and engagement process for the development of its SB2 Zone. Along with many other stakeholders, the Commission to End Homelessness, OC Community Services, and First District participated in the City’s outreach and engagement process by providing input on components of the ordinance, including provision for a two-hundred bed emergency shelter/multi-service center. In September 2013, the City of Santa Ana adopted its SB2 Ordinance and became the only City in Orange County to allow for a two-hundred bed emergency shelter/multi-service center. In February 2014, the State approved the City’s Housing Element/SB2 Ordinance.
Since the establishment of the City’s Ordinance, the County has evaluated approximately 30 different sites in the City’s SB2 Zone. The proposed site is in the City’s SB2 Zone and meets the County’s site selection criteria for a year round emergency shelter/multi-service center. The site selection criteria included but was not limited to the cost of acquisition, condition and size of the building, parking, fenced outdoor areas, and proximity to public transportation, the existing seasonal armory shelter, and other county services.
City of Santa Ana Efforts and Partnership:
In April 2014, the City of Santa Ana established a staff working group on homelessness and invited the County to participate. The working group includes representatives from the City Manager’s Office, City Attorney’s Office, Police Department, Planning and Building Agency, Community Development Agency, as well as the Parks, Recreation and Community Services Agency. Staff members from the First District and OC Community Services regularly meet with the working group to address current and emerging homeless issues. In advance of your Board’s consideration of the proposed site, the City of Santa Ana held a Special Council Meeting on Homelessness on June 12, 2014 where City and County representatives presented on issues and opportunities related to homelessness. In partnership with the County, the City of Santa Ana also held a large community forum at Kennedy Elementary School on July 2, 2014.
The Real Estate
Transaction
The Purchase and Sale Agreement (Agreement) between the County, as purchaser, and B&N Group/JRMV Investments, Inc., as seller, for the purchase of the property at 1217 E. Normandy Place in Santa Ana for $3,600,000 has been fully-negotiated by the parties and has been executed by the seller. The Agreement is attached hereto as Attachment A. The Agreement contains standard County language, which has been developed and tailored for this specific acquisition by CEO/Real Estate and County Counsel.
The property consists of a one-story 23,220 square foot industrial warehouse building, constructed in July 2000, situated on approximately 56,942 square feet of land, with 44 parking spaces. It is currently used as a storage warehouse. Property ingress and egress is exclusive to this site and is not shared with any adjacent property parcels.
Due Diligence investigations are underway including the procurement of a preliminary title report and an appraisal. Additional Due Diligence investigations, which will occur during the 90 day escrow period, include: Phase I environmental site assessment, land survey, structural and physical inspection, roof inspection, sewer line inspection, hazardous materials inspection, and a safety inspection. Due Diligence will be conducted during the escrow period to determine the suitability of the building for the County's intended use. The building and land are in excellent condition and will not require any rehabilitation or renovation other than the tenant improvements required for use as an emergency shelter/multi-service center. The source of funds for this building acquisition are Fund 15B, a County Executive Office controlled fund, designated for housing related uses and Federal Community Development Block Grant (CDBG) Funds. Costs related to any necessary building modifications will be identified through the Request for Proposals (RFP) process that will be subsequently released by OC Community Resources/OC Community Services to select a contractor operator for the facility. The RFP will be released once the site is owned by the County.
The County has engaged CB Richard Ellis, a certified California Commercial Appraiser and a qualified County Procurement vendor to provide an opinion of value.
In compliance with HUD requirements for use of Federal CDBG funds, a National Environmental Policy Act (NEPA) Environmental Assessment will be completed prior to close of escrow.
Post-Acquisition
Considerations
On December 10, 2013, your Board received and filed the OC Community Services Year-Round Emergency Shelter and Multi-Service Center Cost Model Report (Report). This Report estimates the cost to construct tenant improvements for a Year-Round Shelter (For 200 residents - individuals and families) and Multi-Service Center model site to be $100/square foot or $2,322,000.00 for a 23,220 square foot building. The Report estimates the annual costs to operate and maintain the facility at $2,600,000.00. The sources of funds for development are Fund 15B, a County Executive Office controlled fund designated for housing related uses, and Federal Community Development Block Grant Funds. The sources of funds for operating costs are Federal Community Development Block Grant Funds, Federal Emergency Solutions Grant Funds, County General Funds, and Mental Health Services Act Funds. In addition to these funds, the selected operator will secure other public and private funds to leverage the County's funds for development and operation of this facility.
FINANCIAL IMPACT:
Funding for this acquisition is available through the use of the CEO Housing Fund 15B, a County Executive Office controlled fund, designated for housing related uses and the Federal Community Development Block Grant from OC Housing, Fund 15G. Appropriations and funding for this project were included in the FY 2014-15 Adopted Budget approved by your Board on 6/24/14.
STAFFING IMPACT:
N/A
REVIEWING AGENCIES:
County Counsel Approved Agreements to Form
EXHIBIT(S):
Exhibit A: Property
Aerial Map
Exhibit B: Property Location Map
Exhibit C: Property Assessor Parcel Map
Exhibit D: Grant Deed (unsigned)
Exhibit E: Real Property Acquisition
Questionnaire
Exhibit F: Purchase and Sale Agreement
Summary
Exhibit G: Emergency Shelter Cost Model
Report
ATTACHMENT(S):
Attachment A:
Purchase and Sale Agreement