REPORT TO THE CITY COUNCIL FROM: THOMAS C. ESQUEDA, City Manager JERRY DYER, Mayor Office of the Mayor & City Manager BY: TIM A. ORMAN, Chief of Staff to the Mayor Office of the Mayor & City Manager PHIL SKEI, Assistant Director Planning and Development Department SUBJECT ..Title Actions pertaining to the acquisition of The Villa Motel, a 51-room motel at 817 N. Parkway Drive, Fresno, California (APN 449-335-25), to provide temporary shelter and prevent COVID-19 among individuals experiencing homelessness in the City of Fresno: 1. Adopt a finding of Categorical Exemption pursuant to Section 15301/Class 1 of the California Environmental Quality Act (CEQA) guidelines 2. Approve a Purchase and Sale Agreement with Hemantkumar Patel in the amount of $2,430,000. ..Body RECOMMENDATION Staff recommends the City Council adopt a finding of Categorical Exemption pursuant to Section 15301/Class 1 of CEQA guidelines, approve a Purchase and Sale Agreement in the amount of $2,430,000 using American Rescue Plan Act of 2021 (ARPA) funds, and authorize the City Manager, or designee, to sign all necessary documents to open and complete escrow on the property. EXECUTIVE SUMMARY In connection with the Council's December 9, 2021, approval of the Administration's request to apply for Homekey funding, this item will result in the City's purchase and renovation of the Villa Motel to be used as a temporary emergency shelter. The Administration recommends approval allocating $2,430,000 of ARPA funds appropriated by Council for affordable housing development on December 9, 2021, to acquire the property. If the City's Homekey funding application is approved by the State, the $2,430,000 in ARPA funds used for acquisition of the property will be reimbursed. BACKGROUND The Villa Motel is located along the Parkway Drive Corridor. This area of Fresno is a densely populated strip of motels visible along Highway 99, with a history of being the epicenter for families and individuals living in poverty. The subculture of human trafficking, gangs, and drugs draw adults and their children into a self-perpetuating cycle, creating Adverse Childhood Experiences of abuse, neglect, and trauma. During COVID-19, it is crucial that they are provided with improved quality living conditions. This project, in combination with several other proposed efforts, would support these individuals and further the City's long-term plans to transform this neighborhood. Acquisition of The Villa Motel will add another property to the portfolios of the City and Fresno Housing Authority and will continue the transformation of Parkway Drive from an unhealthy environment rife with crime to a safe neighborhood and community. ENVIRONMENTAL FINDINGS Staff has performed a preliminary environmental assessment of this Project and has determined it falls within the Categorical Exemption set forth in CEQA Guidelines Section 15301/Class 1 (existing facilities) which exempts projects involving a negligible or no expansion of an existing facility. This exemption applies because this project involves the purchase of the Villa Motel without expansion of the facility. Staff has determined that none of the exceptions to Categorical Exemptions set forth in the CEQA Guidelines, Section 15300.2 apply to this project. LOCAL PREFERENCE Local preference is not applicable because this agreement does not include an award of a construction or service contract. FISCAL IMPACT There is no long-term impact on the City's General Fund as a result of this action because the City is using grant funds the City has already received. Attachment: Attachment A - Purchase and Sale Agreement