Motels to house the homeless: Modesto could seek state money to purchase more
Modesto could seek state funding to buy a motel or motels and convert the property into supportive housing for people who are homeless or at risk of homelessness.
This is similar to Kansas House, the former 103-room American Budget Inn & Suites at Kansas Avenue and Highway 99 that the Stanislaus Regional Housing Authority purchased and converted into studio apartments.
Modesto and Stanislaus County provided financial and other assistance. Kansas House opened in May 2020.
Modesto would seek funding through Project Homekey, one of California’s initiatives to provide housing for people who are homeless or at risk of becoming so.
Gov. Gavin Newsom announced Sept. 9 the project’s second round, which provides $1.45 billion to house people, including grants to local governments to purchase and convert hotels, motels, vacant apartment buildings and other properties into permanent housing.
Eligible projects also include buying and converting empty storefronts or strip malls into housing.
Deputy City Manager Caluha Barnes and Community Development Manager Jessica Hill spoke with The Bee about the city’s efforts.
In anticipation of Project Homekey’s second round, Modesto and Stanislaus County sent out what is called a request for information July 20 to motels and hotels to gauge their interest in selling their properties. Eight properties in the city and two in the county expressed interest.
Council decides in about a month?
County Deputy Executive Officer Tina Rocha said county staff is conducting its due diligence and could know within a couple of months whether it will seek permission from the Board of Supervisors to submit a grant application.
Hill said she expects that in about a month, city staff will ask the City Council’s permission to submit an application.
But Hill and Barnes said they could not provide many details at this point because Modesto is conducting its due diligence. Those details include how many properties the city is pursuing. The name or names of the property or properties eventually will become public.
Modesto also is looking at zoning, project costs and the proximity to essential services, including bus stops and grocery stores, and finding a location that strikes a balance between providing housing that works for its residents and is a good fit for the surrounding community.
Additionally, the city wants to find a housing agency to partner with and that would own and operate the property or properties. The city said this would be permanent supportive housing.
The key is that the people who live there get the services, such as mental health counseling and job training, they need to better their lives.
Modesto can expect to get funded if it submits a timely grant that meets the state’s scoring criteria, according to Russ Heimerich, a spokesman for the California Department of Housing and Community Development. (The state will fund grants as long as it has funding or until May, whichever comes first.)
The state expects to announce grant awards within 45 days of receiving a complete and accurate application with all of the supporting documentation, according to what is called a notice of funding availability, or NOFA, for Project Homekey’s second round. The state released the applications Thursday.
Aggressive timeline
The program has an aggressive timeline. The NOFA states that applicants have eight months from the date they have been awarded funding to close escrow on a property and 12 months from the award to fully rehabilitate the property. The property then needs to be fully occupied — a vacancy rate of no more than 10% — within 90 days after that.
Barnes said the city expects some resistance to the project. “No one will be raising their hands and say bring it here,” she said. But she said this is about Modesto trying to address one of the more serious issues in the community by providing housing for those people who are ready for it.
Barnes said the city wants to “tell the story about the good of these projects, which is to have fewer people in the parks and across the community who are getting back in the game and embracing housing and hope.”
This story was originally published September 30, 2021 at 7:15 AM.
