Affordable housing project granted to Wallace House in 3-1 decision
During the March 6 special meeting of the Cloverdale City Council, the council voted 3-1 to sole source the development of the Cherry Creek affordable housing project to the Cloverdale Community Outreach Committee (CCOC), or Wallace House, rather than open up the development to a Release for a Request for Proposals (RFP) process.
Two upcoming deadlines — the lease with Wallace House ending in the fall and a $1.9 million bond balance spending cap of 2022 — meant that the council had to decide both what to do with the site in the future and how to spend the money. The CCOC operates a housing facility on Cherry Creek, and an outpouring of public comment was in support of the city maintaining that relationship and sole sourcing the project to CCOC, which would allow CCOC to continue operating past the September 2019 lease expiration.
This issue was initially brought to the council on Feb. 27, where options were discussed but not voted on. During the February meeting, the council expressed interest on sole sourcing the project to Wallace House if the bond proceeds would allow it. City staff came back on March 6 affirming that sole sourcing the project would be an option, and that the bond proceeds don’t require an RFP process for the funds to be used.
“We think there’s an opportunity to be transparent in the process and see what potential proposals might come forward,” City Manager David Kelley said while advising the council of the city staff’s recommendation to open up an RFP process. “That doesn’t mean your precluding any one partner from submitting a proposal, it just gives you some flexibility in looking at what the market might provide in terms of alternatives for potential development of the site and operation of the site … if you decide to sole source, the same level and type of documentation that would be required (in the RFP process) will be required for that sole sourced developer … The RFP process just gives other entities the opportunity to present proposals for future development of the site to the council and the community for further review.”
Prior to opening up the discussion to public comment, Vice Mayor Gus Wolter inquired about and stressed transparency should the city decide to sole source the development to Wallace House. Kelley reverberated his previous statement regarding Wallace House having to submit the same paperwork that they would have had to submit during an RFP process.
Margaret Van Vliet, executive director of the Sonoma County Community Development Commission, spoke in favor of the city going through an RFP.
“I’m a big fan of public solicitations, because I do think that inviting the public sector to give you a choice can sometimes pay dividends. We’ve recently had an RFP and we had seven really quality proposals … I think it brought some new ideas that we hadn’t considered,” she said. “I want to voice my support for the efforts generally, and offer our technical support if it’s at all useful to you with respect to this project or any other housing or homelessness related work going on.”
According to Kelley, the state’s health and safety code dictates that whomever the city enters into a development agreement with should be able to operate and maintain an affordable housing project for 55 years.
“We’re really in this for the long term, and we want to seek a partner that’s going to provide that long-term stability for our community,” he said.
Wallace House has 28 clients who live in permanent, supportive or transitional housing, some of whom are families with children or are seniors who were displaced once rent in the area began going up.
“I did want to take the opportunity to thank the city for the partnership we’ve had at Cherry Creek Village for the last 10 years,” Wallace House/CCOC Executive Director Colleen Halbohm said. “We hope to continue and expand our programs by building the units that are proposed at Cherry Creek Village.”
Wallace House is partnering with development firm Kingdom Development. Kingdom’s chairman of the board William Leach also attended the city council meeting, where he answered questions from the council.
“Our nonprofit board has a specific mission to come alongside local community impact groups and help them get affordable housing developments built that they may not have the expertise to get built,” Leach said.
According to Leach, the partnership allows Wallace House to be the “managing general partner,” with Kingdom serving as the “administration general partner.” This allows the control of the housing development to maintain in Wallace House’s hands, while making Kingdom available for administrative oversight.
“Our partnership is unique in terms of its structure,” Halbohm said. “Most affordable housing developments, the affordable housing developer receives the development fee — which is generally $1.5 million — in our case we’re sharing that with our development partner, which will allow us to do some pretty incredible things with that money. Additionally, the rental income that we would receive from Cherry Creek Village would support three case managers and we would have an on-site property manager.”
While some members of the public, and city staff, advised the council that seeking proposals is the best practice, there was also an onslaught of public support for sole sourcing the project to Wallace House.
“Many, many years ago, the Wallace House gave me a handout and they helped me,” Toby Zipperlen said. “They didn’t give me money, they helped me to look at my situation and what I was doing to myself — and what I was doing to myself was wrong … I don’t spend money on drugs today, I don’t spent it on alcohol. I buy art supplies — I couldn’t do any of that today without the love and support of Wallace House, the agency and them believing in me.”
Multiple comments in favor of sole sourcing the project followed, each person echoing the desire for the city to maintain its relationship with the local, small-scale program. Many people also expressed concern with the possibility of an extended timeframe should the council decide to open up the development for an RFP.
“In opening an RFP, we lose sight of what is working for the community of Cloverdale with an abundance of ideas and paperwork that may or may not work for our town. I ask that we keep in mind that we have something that is incredible and unique, that it’s a resource that can help us directly. I ask that we please sole source the development to Wallace House so that we can continue to help others successfully,” Cloverdale resident Jessica Chavez said.
Following numerous questions about Kingdom Development’s history of developing affordable housing, the council voted 3-1 to sole source the project to CCOC.
“I find the community, even the council in my perception, that they’re leaning toward this appreciation and wanting to make CCOC or the Wallace House work,” Councilmember Jason Turner said. “When we look at this RFP — money will have to be spent just to throw your hat in the ring … we would be asking them to spend money with this notion in our head that we’re already kind of leaning toward Wallace House anyway. It is my personal opinion that that’s a little irresponsible of their resources.”
Mayor Melanie Bagby, Wolter and Turner voted in favor of sole sourcing the project, and Councilmember Marta Cruz voted against. Councilmember Mary Ann Brigham was absent from the meeting.
