Actions Related to the Loan Commitment for the Valley Transportation Authority Capitol Station Affordable Housing Development.

The City Council is considering approving a construction-permanent loan commitment of up to $8,400,000 from Low- and Moderate-Income Housing Asset Funds to MidPen Housing Corporation (or an affiliated entity) for the Valley Transportation Authority Capitol Station Affordable Housing Development. This development, located at the southwest corner of West Capitol Expressway and Narvaez Avenue, will consist of 203 residential units, including 201 affordable rent-restricted units and 51 permanent supportive housing units. The project serves households earning between 30% and 60% of Area Median Income (AMI).

A key provision authorizes an increase in rents and income restrictions up to 60% of AMI for new tenants in Project-Based Voucher (PBV) subsidized apartments if PBVs expire or terminate, and for some or all tenants in the event of foreclosure, provided it's necessary for the development's feasibility and allowed by other funds. The loan will be secured by a leasehold deed of trust, with a 4% simple interest rate during both construction and permanent phases, a construction loan term of up to three years, and a permanent loan term of 55 years. The total development cost is estimated at $169,591,201, with other funding sources including County Measure A funds ($11,571,000) and State Affordable Housing and Sustainable Communities Program funding ($35,000,000 loan and $14,339,431 grant). Construction financing is anticipated by October 2026, with construction starting by November 2026 and taking approximately 24 months.