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File Number: 22-122 more competitive for Project Homekey funding. While affordable rental housing generates revenue from rent to sustain long-term affordability, the navigation center and shelter rely on public subsidies and there are no long-term public funding sources for them. The City will continue to explore County, State and federal operating and supportive services funding to ensure that the navigation center can operate sustainably and longer term when the City moves it to a new location. Analysis The City ordered a formal appraisal of the Property in late 2021, which was $5.8 million. Staff recommends that the City Council approve the seller’s asking price of $6.15 million, a slight increase to the appraised value. Initial informal due diligence shows the Property appears in overall good condition and ready to quickly transition to a navigation center and shelter. The Property is situated near prominent homeless encampments. If the Council authorizes the execution of the purchase agreement, City staff will open escrow with a $184,500 deposit. The deposit becomes non-refundable on July 30, 2022. The City will know before July 30 if it has or has not been awarded Project Homekey funding. The City has the right to exercise up to three (3) 30-day extensions with additional deposits not to exceed $75,000. If a second extension is sought by the City, then the total $75,000 in deposits will be non-refundable. Below are the itemized acquisition/closing costs: ·Purchase price $6,150,000 ·Closing costs (estimate)$ 85,000 TOTAL $6,235,000 There are due diligence issues that must be assessed prior to the May 2 Project Homekey deadline and close of escrow. These due diligence reports/studies have already occurred or are under contract and budgeted for under the City’s Adopted FY2021-2022 Budget and include to date: ·Appraisal (completed)$ 8,500 ·Relocation Consultant $ 38,640 ·Property Condition Assessment $ 3,300 ·Phase I Environmental $ 2,100 ·ALTA Survey $ 4,400 ·Lead in Water Testing $ 1,220 ·Lead Based Paint & Asbestos $ 6,925 ·Americans with Disabilities Act Survey $ 2,200 ·Termite Report $ 1,570 ·Sewer Line Scoping $ 1,950 TOTAL DUE DILIGENCE COSTS $ 70,805 Because the City is planning to allocate federal and/or State funds to the acquisition and rehabilitation of the Property, the City will ensure full compliance with State and/or federal relocation laws regarding motel guests who may be determined to be eligible for relocation Page 3 City of San Leandro Printed on 3/16/2022