Council moves on housing project
EL CENTRO – The El Centro City Council on Tuesday authorized city staff to sign various loan documents related to the $12 million, 24-unit El Dorado affordable housing development.
The documents are for a $5.1 million dollar loan the city was awarded in 2018 from the federal HOME Investment Partnerships Program.
The loan is expected to close by early September, allowing construction on the project to begin in October and finish by October 2021, according to meeting agenda backup documents.
The project is being undertaken in partnership with general contractor AMG & Associates, and is being financed with state tax credits as well as a private loan.
Located in the 1800 block of Eighth Street, the project site is about three acres and is adjacent to the Las Brisas housing development
Though all five members of the council approved the resolution directing city staff to sign the loan documents, both Mayor Efrain Silva and Councilwoman Cheryl Walker-Viegas expressed some reservations.
Prior to the council’s vote, they both shared concerns about the project’s overall $12 million cost, which roughly equated with each housing unit costing about $500,000 to construct.
“It just seems an awful big investment for 24 units,” Silva said.
“Something is seriously wrong with those kind of numbers,” Viegas-Walker added.
Adriana Nava, the city’s Community Services director, explained that the project’s costs reflect the prevailing wages that contractors will be paid, as well as various developer impact and utility fees.
Construction of the 24-unit development is considered phase 1 of a larger proposed housing development, and therefore has more upfront costs as well, Nava said.
Amenities to be built during phase 1 include a community room, dog park and half of a basketball court.
Once completed, the El Dorado development will have eight two-bedroom units, seven three-bedroom units and eight four-bedroom units.
One of the units will be a manager’s unit and is not considered a rent-assisted unit.
Six of each of the two, three- and four-bedroom units will be set aside for households who earn 60 percent or less of the area’s median income. Two of both of the two- and four-bedroom units, and one three-bedroom unit will be reserved for households earning 50 percent or less of the area’s median income.
The city expects to collect about $437,000 in development impact fees of for phase 1 construction, Nava said during Tuesday’s meeting. The proposed project will not draw from the city’s general fund.
The city will also col
lect an annual $2,500 fee for monitoring the units once completed. The city does similar monitoring of other housing developments but does not receive any payment in return, she said.
As part of the $5.1 million loan, the city will use $100,000 for consulting and administrative services. Additionally, in 2018 the council had authorized the use of $134,000 in HOME Program income funds for the project, according to meeting agenda backup documents.
The term of the loan is for 55 years and has a 3 percent interest rate. The loan’s first payment will be due 15 years after project’s completion date, according to meeting agenda backup documents.