Actions pertaining to the Parkway Terrace project located at 933 North Parkway Drive, Fresno, California 93728 (Council District 3) 1. Adopt a finding of Categorical Exemption per staff’s determination, pursuant to Section 15268 (Ministerial Projects) of the California Environmental Quality Act Guidelines, Environmental Assessment dated August 31, 2026 2. ***RESOLUTION - Repealing and replacing Resolution 2026-26 in its entirety and authorizing joint application to and participation in the Homekey+ Program with co-applicant Parkway Prime, LLC for the Parkway Terrace project and authorizing the City Manager or designee to sign all required implementing documents (Subject to Mayor’s Veto) 3. Approve a Repair Services Agreement between the City of Fresno and Parkway Prime LLC, establishing certain terms, conditions, and compensation relating to the Homekey+ Parkway Terrace Project

REPORT TO THE CITY COUNCIL FROM: JENNIFER K. CLARK, AICP, Director Planning and Development Department PHILIP SKEI, Assistant Director Planning and Development Department BY: JENNIFER DAVIS, Senior Management Analyst Housing Finance Division, Planning and Development Department SUBJECT ..Title Actions pertaining to the Parkway Terrace project located at 933 North Parkway Drive, Fresno, California 93728 (Council District 3) Adopt a finding of Categorical Exemption per staff’s determination, pursuant to Section 15268 (Ministerial Projects) of the California Environmental Quality Act Guidelines, Environmental Assessment dated August 31, 2026 ***RESOLUTION - Repealing and replacing Resolution 2026-26 in its entirety and authorizing joint application to and participation in the Homekey+ Program with co-applicant Parkway Prime, LLC for the Parkway Terrace project and authorizing the City Manager or designee to sign all required implementing documents (Subject to Mayor’s Veto) Approve a Repair Services Agreement between the City of Fresno and Parkway Prime LLC, establishing certain terms, conditions, and compensation relating to the Homekey+ Parkway Terrace Project ..Body RECOMMENDATION Staff recommends the City Council (1) adopt a finding of Categorical Exemption per staff’s determination, pursuant to Section 15268 (Ministerial Projects) of the California Environmental Quality Act Guidelines, (2) adopt a Resolution repealing and replacing Resolution 2026-26 in its entirety and authorizing joint application to and participation in the Homekey+ Program with co-applicant Parkway Prime, LLC for the Parkway Terrace project and authorizing the City Manager or designee to sign all required implementing documents, and (3) approve a Repair Services Agreement between the City of Fresno and Parkway Prime LLC, establishing certain terms, conditions, and compensation relating to the Homekey+ Parkway Terrace Project. EXECUTIVE SUMMARY On November 26, 2024, the California Department of Housing and Community Development (HCD) announced the availability of approximately $2.145 billion of Homekey+ Program funding through a Notice of Funding Availability (NOFA). On March 13, 2025, the City Council adopted Resolution No. 2025-68 authorizing the submission of the City of Fresno’s (City) Homekey+ joint application with Fresno Prime LLC for the Valley Inn Project, seeking up to $30,000,000 in Homekey+ Program funds to be used for the development of 85 units of Permanent Supportive Housing for households and Veterans at-risk of or experiencing homelessness. On February 26, 2026, at the request of HCD, the City Council repealed Resolution No. 2025-68 and adopted Resolution No. 2026-26 authorizing application and adding co-applicant, “Parkway Prime, LLC” (previously “Fresno Prime, LLC) and the project name, “Parkway Terrace Project” (previously “Valley Inn Project”). On June 30, 2026, the City received notice that HCD was awarding the Project Homekey+ Program funds in the amount of $32,550,614. On August 6, 2026, HCD requested an updated Resolution authorizing application with Parkway Prime LLC reflecting the actual award amount of $32,550,614, or more. This is a technical update requested by HCD and has no material impact on the scope of the project. Approving the Resolution will provide compliance with the funding requirement from HCD, allowing HCD to deliver the Homekey+ Program award. Approving the Repair Services Agreement with co-applicant, Parkway Prime LLC, will establish certain terms, conditions, and compensation relating to the Homekey+ Parkway Terrace Project. BACKGROUND The California Department of Housing and Community Development (HCD), in collaboration with the California Department of Veterans Affairs (CalVet), announced the availability of approximately $2.145 billion of Homekey+ Program funding through a Notice of Funding Availability (NOFA) dated November 26, 2024. Homekey+ will support the development of Permanent Supportive Housing for households with an individual or Veteran with mental health or substance use disorder challenges and who are at-risk of or experiencing homelessness. Building on the success of both Project Roomkey and approximately $3.572 billion awarded over three rounds of Project Homekey, Homekey+ continues a statewide effort to sustain and rapidly expand Permanent Supportive Housing for persons experiencing homelessness. The Parkway Terrace Project involves the conversion of the former Valley Inn motel into 84 units of Permanent Supportive Housing for individuals and Veterans who are at-risk of homelessness (Project). The Project is situated on 2.42-acres of City-owned land located at 933 North Parkway Drive, Fresno, CA 93728 (APN 449-335-32) (Property). On May 7, 2021, City Council approved the City’s acquisition of the Property for use as an interim low-barrier emergency homeless shelter as part of Project Homekey. The City was awarded Homekey 2 grant funds in August 2022, which enabled the City to make critical improvements to the facility, thereby enhancing the experience of residents at the temporary shelter. On March 13, 2025, the City Council adopted Resolution No. 2025-68 authorizing the submission of the City’s Homekey+ joint application with Fresno Prime LLC for the Valley Inn Project, seeking up to $30,000,000 in Homekey+ Program funds to be used for the development of the Project. On February 26, 2026, at the request of HCD, City Council repealed Resolution No. 2025-68 and adopted Resolution No. 2026-26 authorizing the joint application and adding co-applicant, “Parkway Prime, LLC” (previously “Fresno Prime, LLC) and the project name, “Parkway Terrace Project” (previously “Valley Inn Project”). On June 30, 2026, the City and Parkway Prime, LLC (Developer and co-applicant) received notice that the Project was awarded Homekey+ Program funds in the amount of $32,550,614. The award is comprised of Capital Award funds of $25,462,140; Operating Award funds of $6,818,474; and an additional Operating Award for Veterans units of $270,000. On August 6, 2026, HCD requested an updated authorizing Resolution reflecting the actual award amount of $32,550,614, or more. This is a technical update requested by HCD and has no material impact on the scope of the project. Parkway Terrace is a Gap Financing Project with a total of 85 units, including one (1) Manager's unit. The Project dedicates 75 units to serve Individuals At-Risk of Homelessness with a Behavioral Health Challenge and nine (9) units to serve Veterans At-Risk of Homelessness with a Behavioral Health Challenge. At least thirteen (13) of the units will exceed federal and state accessibility requirements for persons with mobility disabilities; and at least nine (9) units will include features accessible to persons with hearing or vision disabilities. The Project will provide permanent supportive housing (PSH) for households with incomes up to 30% of Area Median Income (AMI). Each unit will be equipped with essential amenities including individual HVAC systems, a refrigerator, electric stovetop, microwave, stainless steel sink, a bed frame with mattress, table with chairs. Each unit will have a bathroom equipped with water saving fixtures, a shower with grab bars, a toilet, and vanity with storage. Each Project unit will also be provided with free internet service. The Parkway Terrace Project will rehabilitate and modernize a three-story former motel, converting it from non-residential to residential use to provide Permanent Supportive Housing. The renovated building will feature solar panels, an elevator, and a shared laundry facility with four washers and dryers. Residents will also have access to community, fitness, and computer rooms, as well as a landscaped courtyard with picnic and barbecue areas. Situated in a mixed-use commercial neighborhood, the property is highly walkable, with a food market, a park, and public transit all located within one mile. Developer and co-applicant, Parkway Prime LLC, will act as the Developer of the Project and will oversee the construction of the 84 Homekey+-assisted units, the manager’s unit, and all onsite and offsite improvements. The City will act as the owner of the Property and will facilitate the Developer’s access to the Property through an executed Right-of-Entry Agreement. Once construction is completed and occupancy is achieved, the Developer will provide comprehensive supportive services to all residents, including high quality and individualized case management with a housing focused approach. These services will include linkage to substance abuse treatment services, school services, vocational services, mental health services, entitlement program assistance, health and disease education, 24/7 peer support, housing retention skills, legal assistance, medical services, and other Veterans-focused services. Upon completion of construction, the City will transfer ownership of the Property to Developer through a long-term ground lease, while complying with Surplus Land Act requirements. The Repair Services Agreement establishes certain terms, conditions, and compensation relating to the rehabilitation of the Property, as well as the Project’s eligible development costs. The Developer has the resources, technical ability, and financial expertise to repair projects like Parkway Terrace to make them available for affordable housing with supportive services. As reflected in the Repair Services Agreement, the Project’s total development cost is approximately $25,462,090. The development of Parkway Terrace is subject to the City’s receipt of the Homekey+ Program Award in the amount of $32,550,614 and HCD’s fully executed Standard Agreement, which binds the City and Developer to the rules, timelines, and commitments made in the Homekey+ joint application. The Project aligns with the City’s affordable housing goals and objectives as outlined in the “One Fresno Housing Strategy” and the Housing Element of the 2035 General Plan. The Project will make a positive and lasting impact on the neighborhood and surrounding areas by providing Permanent Supportive Housing for households with an individual or Veteran who is At-Risk of Homeless, and who are also living with a Behavioral Health Challenge. Further, the Project will help restore housing stability in this vulnerable community. The conversion of this motel will not displace any clients. ENVIRONMENTAL FINDINGS The Planning and Development Department prepared an Environmental Assessment for property located at 933 North Parkway Drive, dated August 31, 2026, under application number P26-02539. Based on the analysis, the project was determined to be statutorily exempt from the California Environmental Quality Act (CEQA) under Section 15268 (Ministerial Projects) of the CEQA Guidelines, which states that Statutory Exemption can be made for ministerial projects. Under Section 15369 of CEQA Guidelines, "Ministerial" describes a governmental decision involving little or no personal judgment by the public agency as to the manner of carrying out the project. A ministerial decision involves only the use of fixed standards or objective measurements, and the public agency cannot use personal, subjective judgment in deciding whether or how the project should be carried out. The determination of what is "ministerial" can most appropriately be made by the public agency involved based upon its analysis of its own laws, and each public agency should make such determination either as a part of its implementing regulations or on a case-by-case basis which projects are considered exempt from CEQA. As such, Ministerial projects approved by public agencies are not subject to the requirements of CEQA (Pub. Res. Code Sec. 21080(b)(1)). Furthermore, projects funded through HCD loans or grants under HSC §§50675.1.3 or 50675.2 for acquiring, rehabilitating, converting, or constructing permanent supportive housing for people who are homeless, chronically homeless, or at risk of homelessness as defined in 24 C.F.R. §578.3, and who are living with a behavioral health challenge, shall be considered by-right and subject to streamlined ministerial review if all required criteria are met. Section 21080 of the Public Resources Code exempts from the application of CEQA those projects over which public agencies exercise only ministerial authority. The project has been deemed compliant with the criteria of AB 531 and is therefore subject to a ministerial review process. Further, no exceptions to the Categorical Exemptions under CEQA Guidelines, Section 15300.2, apply to this project and the project is not expected to have a significant environmental impact. Based on the Department’s analysis, the project meets all criteria to be Statutorily Exempt from CEQA pursuant to CEQA Guidelines Section 15268 (Ministerial Projects). Therefore, staff concluded pursuant to CEQA Guidelines Section 15268 that the project is ministerial and thus exempt from further CEQA analysis. LOCAL PREFERENCE Local preference is not applicable in this case, as the Resolution supports a state funding application, and the item does not include a bid or award of a construction or services contract. FISCAL IMPACT There is no impact to the City’s General Fund as a result of this action. If awarded, funding for the project will be provided through the California Department of Housing and Community Development’s Homekey+ Program award to the City of Fresno. Attachments: Environmental Assessment for 933 North Parkway Drive Resolution Authorizing Homekey+ Application for the Parkway Terrace Project Repair Services Agreement for Parkway Terrace Project