Merced plans to build more lower-income housing, but city still needs about $3 million
With the casting of a unanimous vote Monday night, the Merced City Council greenlit a plan they said would address the community’s housing issues and support its homeless residents.
“We’re here tonight to discuss again your commitment to affordable housing,” said Merced Development Services Director Scott McBride on Monday. “We’re all in alignment about this being a priority.”
The council’s move gave city staff the OK to submit Merced’s application to the $304 million state Permanent Local Housing Allocation (PLHA) Program. The application outlines a five-year plan for Merced’s estimated $3 million allocation.
Eligible ways to utilize PLHA program allocations include projects like developing extremely low to moderate income housing, assisting the homeless or residents at risk of becoming homeless, operating navigation centers, and rehabilitating vacant homes.
The program comes from a 15-bill housing package signed in 2017 by then-Gov. Jerry Brown. The package targeted California’s shortage of homes and high housing costs – an issue all too familiar in Merced.
California housing experts estimate the state faces an annual deficit of about 100,000 housing units each year. Meanwhile, affordable housing projects typically only generate about 20,000 units annually.
Plan to include affordable rentals, permanent supportive housing
Merced’s proposed plan would have the city leverage its more than $3 million allocation toward building more homes for people earning at least 60% below the area’s median income.
The plan designates 95% of program funding through 2023 for developing affordable multifamily rental projects for households with incomes at or below 60% of AMI. The remaining 5% would be used to cover associated administrative costs.
Merced’s five-year plan also outlines a development project proposed by UPholdings in partnership with Self Help Enterprises. The project is slated to add about 67 multi-family units to the city’s housing stock, ranging in size from one to three bedrooms. PLHA program assistance would be provided via a low-interest deferred loan.
A portion of the units would also provide for permanent supportive housing services for those in need of ongoing assistance and services to maintain housing stability, according to the plan.
The city has yet to finalize development projects for the last two years of the plan, but Merced has received numerous responses to its open housing partners request for qualifications, according to city staff.
The application to the California Department of Housing and Community Development Department (HCD) is due Dec. 31. HCD will issue award letters on a rolling basis once the application is submitted, according to city staff.
