REPORT TO THE CITY COUNCIL FROM: JENNIFER CLARK, Director Planning & Development Department THROUGH: PHIL SKEI, Assistant Director Planning & Development Department BY: SHIN AE CHOI, Real Estate Finance Specialist I Housing & Community Development Division SUBJECT ..Title Approve the First Amendment to the repair services agreement with RH Community Builders, Inc. (RH Community Builders) to amend the Project Homekey rehabilitation budget of $5,981,700.00 by $150,000 for a total amendment contract amount of $6,131,700.00 for repairs and maintenance at The Ambassador Inn (Property), located at 1804 W. Olive Avenue, Fresno, California (APN 449-231-11) ..Body RECOMMENDATION Staff recommends the City Council approve the First Amendment to the repair services agreement with RH Community Builders, to increase the previously approved budget of $5,981,700 by $150,000.00 for a total amended contract amount of $6,131,700.00 for repairs and maintenance at The Ambassador Inn. EXECUTIVE SUMMARY Due to required sidewalk, curb, and accessibility improvements not originally included in the rehabilitation budget at The Ambassador Inn, the approved Repair Services Agreement dated August 18, 2022 must be amended and the budget increased by $150,000.00 for a total agreement amount of $6,131,700.00. This increase is within the Project Homekey budget for this site. BACKGROUND The Ambassador Inn is located along the North 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. Since entering into an agreement with RH Community Builders, RH Community Builders has been using its resources, as well as its technical, and financial expertise to repair the The Ambassador Inn to make it available as a low-barrier emergency homeless shelter. This shelter opened on January 4, 2023 and is fully occupied. The remaining work at this site resulting in this requested amendment was originally scheduled to be completed at a later date as part of the City's planned transformation of Parkway Drive, but staff have determined it is best to complete the work now. 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 repair of The Ambassador Inn without expansion of the facility. Staff determined under the CEQA Guidelines this project fits within the definition of existing facilities in Section 15301/Class 1, as Categorically Exempt from further CEQA review. 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 of the use of State funds. 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 Homekey funds the City has already received that are committed to this project's budget. Attachment: Exhibit A - First Amendment to the Agreement