REPORT TO THE CITY COUNCIL FROM: JENNIFER CLARK, Director Planning and Development Department THROUGH: PHIL SKEI, Assistant Director Planning and Development Department BY: DANNY TOHME, Projects Administrator Housing and Community Development Division SUBJECT ..Title Authorize the City Manager to enter into a Lease Agreement between the City of Fresno and Tutelian Holdings I, L.L.C., a California Limited Liability Company for office space at 2440 Tulare Street, Civic Center Square, for the Housing and Community Development Division ..Body RECOMMENDATIONS Staff recommends that the City Council authorize the City Manager to enter into a lease agreement with Tutelian Holdings I, L.L.C., a California limited liability company for office space at 2440 Tulare Street, Fresno, California, Civic Center Square, for the Housing and Community Development Division (HCD), Housing Finance Division, and Housing Production Division. The attached lease is in substantial form; by approving this action Council is delegating final provision negotiations to the City Manager in collaboration with the City Attorney. EXECUTIVE SUMMARY In Fiscal Year 2023 fourteen staff were added to the Planning and Development Department to increase the internal capacity of the City to meet the affordable housing needs of our community. With the addition of these staff, these Divisions have outgrown the available space at City Hall and must relocate off-site. Staff have identified suitable office space at 2440 Tulare Street to serve the business needs of these Divisions and the public. BACKGROUND As part of the Fiscal Year 2023 budget adopted by City Council, fourteen staff were added to the Planning and Development Department to increase the internal capacity of the City to meet the affordable housing needs of our community. With the addition of these staff, these Divisions have outgrown the available space at City Hall and must relocate off-site. With the many transactions necessary to manage the city's emergency shelter bed inventory, develop tiny home projects, and build permanent affordable housing units as quickly as possible, it is necessary for the staff of these Divisions to have a shared office space out of which to perform these critical business functions and to serve the public. Staff have identified suitable office space at 2440 Tulare Street that meets these needs. ENVIRONMENTAL FINDINGS This Agreement falls within the Class 1 Categorical Exemption for Existing Facilities set forth in the CEQA Guidelines, Section 15301 for existing facilities, as it involves no alteration of existing facilities, with no expansion of use, and will not result in any significant negative effects relating to traffic, noise, air quality or water quality. Furthermore, none of the exceptions to Categorical Exemptions set forth in the CEQA Guidelines, Section 15300.2 apply to this project. LOCAL PREFERENCE Local Preference does not apply because this Agreement is not a bid or award of a construction or services contract. FISCAL IMPACT The relocation recommendation has no fiscal impact to the General Fund. The cost per square foot of 2440 Tulare Street is less than what has already been budgeted to pay for space at City Hall in Fiscal Year 2023. Additionally, the Planning and Development Department will not incur any build-out costs as the space is being leased 'as is.' The Planning and Development Department's existing budget is sufficient to pay for the one-time moving expenses related to technology and furniture for the new location. Attachment: Lease Agreement