Project HomeKey Application Process

One of the key requirements of HomeKey is that applicants must submit an authorizing resolution as part of the application. Cities, counties, and all other State, regional, and local public entities may apply independently, or each entity may apply jointly with a non-profit or for-profit corporation as a co-applicant. If the City of Santa Clara is the applicant or co-applicant, the City Council would need to authorize a resolution to authorize staff to negotiate and execute all documents required or deemed necessary or appropriate to secure the HomeKey funds from HCD and to participate in the HomeKey Program. However, the County of Santa Clara can apply as the co-applicant, eliminating the need for any City Council action related to the formal application for HomeKey funds. 

Project HomeKey applications may be submitted to the State by a local public agency, or a non-profit in partnership with a local public agency. City staff evaluated the City’s portfolio of city-owned land and determined there weren’t any city-owned sites suitable for HomeKey Round 2.

Two non-profits have approached the City about the potential for a HomeKey project on sites within Santa Clara. In these cases, the site selection process was purely developer-led and dependent on properties available for purchase through market channels and deemed feasible for financing and construction. Given that these proposed sites are privately owned, there are no agreements relating to land purchase or lease agreements, proposals, or discussions of the same between the City of Santa Clara and agents or owners for the proposed property sites. 

Land Use and Public Approvals

State law exempts all HomeKey funded projects from local land-use regulations.  Accordingly, any HomeKey project will not go through a City of Santa Clara land use approval process.  Specifically, as stated by the State in CA Health & Safety Code § 50675.1.1 (2020), funds appropriated in the 2020 Budget Act or an act related to the 2020 Budget Act, including, but not limited to, moneys received from the Coronavirus Relief Fund established by the federal Coronavirus Aid, Relief, and Economic Security (CARES) Act (Public Law 116-136), to provide housing for individuals and families who are experiencing homelessness or who are at risk of homelessness, including any HomeKey project (a) shall be deemed consistent and in conformity with any applicable local plan, standard, or requirement, and allowed as a permitted use, within the zone in which the structure is located, and shall not be subject to a conditional use permit, discretionary permit, or to any other discretionary reviews or approvals.

City Council Study Sessions on Potential Responses to Homelessness

July 13, 2021 Study Session

As background, on July 13, 2021, City staff held a Study Session on the City’s response to homelessness with information provided to the City Council on HCD’s Project HomeKey. The study session provided an overview of State’s Project HomeKey program, focusing on a case study of the LifeMoves Homekey project located in Mountain View. Staff also asked for input on the City Council’s potential interest for the City of Santa Clara to participate in Project Homekey 2.0 and to advance a similar project after discussing the advantages and disadvantages of this approach compared to other approaches to providing affordable housing. View the meeting details.

View the July 13, 2021 Power Point Presentation

August 24, 2021 Study Session

On August 24, 2021, city staff held a Study Session on Homeless Encampments and Vehicle Dwelling facilitated by the Police Department. This discussion also included an analysis of short-term intervention strategies, including submitting a Project HomeKey application for an upcoming State funding opportunity to establish a transitional housing site for homeless people. View the meeting details. 

View the August 24, 2021 Power Point Presentation

November 9, 2021 Study Session 

On November 9, 2021, the City Council held a Study Session on the City’s activity to address an unhoused population: California Department of Housing and Community Development’s (HCD) Project HomeKey, and provision of basic services for the City's unhoused. The Study Session addressed two separate but interrelated homeless discussion topics: 1) Updates on Project HomeKey proposals, and 2) next steps for providing short-term basic services to Santa Clara’s unhoused populations.  At the conclusion of the Study Session, the City Council gave direction to staff to proceed with the procurement process for short-term basic services, and regarding the LifeMoves Project HomeKey to continue to work with LifeMoves to explore a potential project within Santa Clara at a different location from the original proposal at White Oak Lane.

Project #1 – Bella Vista, El Camino Real

The developer, Resources for Community Development (RCD) proposes repurposing the property currently known as Bella Vista Inn, located at 3550 El Camino Real, Santa Clara, CA 95051, as Clara Gardens. RCD will serve as the co-applicant with the County Office of Supportive Housing for HomeKey Round 2 funds for this project.

The proposed project would have two phases:

Phase 1 (Project HomeKey): If approved through Project HomeKey, RCD will undertake minor renovations to the existing hotel to create approximately 64 units of transitional housing through the Project HomeKey program. The interim transitional housing use is expected to last for 2-3 years, beginning no later than December 2022. The construction will begin to convert to permanent supportive housing use in 2024. The City does not have an application for this rehab and no planning permit is required. RCD is not planning to ask the City for funding for the Phase 1 project.

Phase 2 (Clara Gardens/SB35): RCD is also proposing a permanent affordable housing development on the site that would not be part of Project HomeKey. While this second Phase project is not part of Project HomeKey, information is provided here for convenience. This second Phase is proposed as a new permanent housing development, “Clara Gardens”, that would add a 7-story building next to the remodeled two-story motel building, resulting in 120 total affordable housing units. These apartments will be available to extremely-low and low-income individuals and families, with 25% of the set aside for those experiencing chronic homelessness and 50% sized for families. In addition, the proposed development will include 81 parking spaces, property management and support services offices, laundry facilities, a secure bike room, approximately 1,200 square feet of ground-floor commercial space, two community rooms, two outdoor spaces, and a roof deck. The proposed permanent housing development benefits from a streamlined non-discretionary permit process under California Legislation SB35.  Plans for Phase 2 were submitted to the City in October for review on technical issues, but, in accordance with SB35, the City does not have a discretionary Planning permit requirement for this project. RCD has indicated that they will be requesting City funding for the Phase 2 project.

On October 5, 2021, the County Board of Supervisors (Board) approved a resolution providing public notice to the public of the County's intent to purchase the Bella Vista Inn and set the public hearing to acquire for the acquisition to November 2, 2021. On October 19, 2021, the Board adopted a resolution delegating authority to County Administration to take all necessary actions deemed necessary for the Homekey Program application. The County proposes to purchase the property for $14,000,000, using approximately $11,000,000 in Homekey funds and $3,000,000 million in Housing Bond funds. It is anticipated that Homekey and the County will also fund the minor renovations for the interim use. 

On November 2, 2021, the County Board of Supervisors unanimously approved the acquisition of The Bella Vista Inn and delegated authority to County Administration to acquire it. The meeting details are available on the County of Santa Clara website.

Longer term, RCD is also expected to submit an application to the County for Measure A funds to support the future development of new permanent housing, which would be subject to separate funding approval. RCD also plans to apply for 4% tax credits and request funding from the City of Santa Clara. 

View the August 30, 2021 PowerPoint Presentation

At this time, no City Council action is required to move the project forward. Interim financing would be provided through the Homekey program and Housing Bond funds.  Staff will schedule the Phase 2 project for further consideration in the future if RCD proceeds with the long-term project and requests a City subsidy as anticipated.

Project #2 – LifeMoves, White Oak Lane

While LifeMoves has communicated a desire to develop a project within Santa Clara, at this time, there is no formal request to the City from the applicant for funding and any budget action would require City Council approval in the future.

As noted above, the project would be exempt from local land use control and would not be subject to a Planning permit.  The developer has informally communicated to the City that they will be seeking City funding for the project if it goes forward. The developer and staff are still exploring feasibility at this time, as directed by the Santa Clara City Council.

The project applicant, LifeMoves, initially proposed a project at 2035 White Oak Lane, Santa Clara, CA 95051 that would have created 60 transitional housing units for families. The site is currently a vacant lot bordered by a residential neighborhood with a mix of apartment buildings and single-family residences, a 7/11 convenience store, and Lawrence Expressway (G2).

At the conclusion of the November 9, 2021 City Council study session, the City Council directed staff to continue to work with LifeMoves to explore a potential project within Santa Clara, but not at the White Oak Lane site.

One of the key requirements of HomeKey is that applicants must submit an authorizing resolution as part of the application. If the City of Santa Clara is the applicant or co-applicant, the City Council would need to authorize a resolution to authorize staff to negotiate and execute all documents required or deemed necessary or appropriate to secure the HomeKey funds from HCD and to participate in the HomeKey Program. The city cannot be the designated co-applicant until the City Council approves a resolution delegating such authority.  Neither the Santa Clara City Council nor the County Board of Supervisors has approved a resolution that would allow LifeMoves to apply to Project HomeKey.  

LifeMoves owns eight of the ten emergency shelters it operates, including a new HomeKey Round 1 funded project in Mountain View. LifeMoves also owns three long-term transitional housing sites and one permanent supportive housing site (located in the City of San Mateo).

Preliminary construction and operating estimates for the White Oak Lanes project were higher than experienced in the other LifeMoves facilities, and the developer team is currently working to reforecast the numbers to form a feasible construction and operating plan. Initial estimates would require a $14 million operating contribution from the City of Santa Clara, which is greater on a per unit basis than what was expected for this type of project.

Staff will return to Council with an update if a new site is identified and a feasible project is ready to move forward with an application to Project HomeKey. Any City funding and corresponding budget action would also require City Council approval in before moving forward.