Marin Independent Journal
September 13, 2022
Richard Halstead
A joint powers agreement will be formed to finance and oversee an affordable housing planned near San Quentin State Prison.
The county, the Marin County Office of Education and a nonprofit public benefit corporation called Education Housing Partners are already in talks to build the proposed Village at Oak Hill project on state-owned land between the prison and the Larkspur Ferry Terminal.
“We are working with the Marin office of education around creating a joint powers association that would offer this rental housing going forward,” Marin County Administrator Mathew Hymel told county supervisors Tuesday.
“Affordable workforce housing is one of the biggest challenges facing our schools and our local governments so we can maintain services,” he said.
In July 2021, the state announced that it was making a small parcel it owns adjacent to San Quentin available to two developers to build a total of 250 units of “affordable” rental housing there.
Education Housing Partners was formed in 2004 by Mill Valley-based Thompson Dorfman Partners to work with school districts to build housing affordable for teachers and other school employees. The nonprofit plans to build a 135-unit apartment building; 101 of the units will be reserved for educators while the remaining 34 units will be earmarked for county employees.
The units will be priced to be affordable to people earning between 60% and 120% of area median income. That means a two-person household could earn between $89,520 and over $149,200 per year.
In a separate but adjacent building planned for the parcel, Eden Housing hopes to build 115 units that would be available to anyone earning between 30% and 60% of area median income. For a two-person household, that translates to between $44,760 per year and $89,520 per year.
The site is located in unincorporated Marin County and within the sphere of influence of the city of Larkspur. There are ongoing discussions between the county and the city about annexing the 8-acre parcel into the city. That would make the city responsible for providing services to the site.
According to the staff report prepared for the supervisors, “creation of a joint powers authority helps the developer access tax-exempt financing.”
Bruce Dorfman, one of the two principals of Thompson Dorfman, said that the biggest hurdle Education Housing Partners faces is financing.
“That is one of the things we’re working on right now through the JPA,” he said.
Dorfman said once the project has received all of its permits and it has a final budget, “we’ll be able to issue bonds to finance the entirety of the improvements.”
“The JPA also further siloes risk for both the county and the Marin Office of Education to the project itself,” Dorfman said. “The security for the underlying debt will be the project, similar to other more market-rate financing structures.”
Dorfman said he initially estimated it would cost about $700,000 per unit to create the housing for the educators and county employees, “but construction costs have continued to escalate.” He now estimates each unit will cost between $750,000 and $800,000.
Supervisor Katie Rice said given those costs the fact that the state is providing the land for free is crucial. The state’s ownership of the land has other benefits as well.
Joanna Julian, a senior project manager at Thompson Dorfman, said the state’s ownership of the land also means that state officials will oversee review of the project for compliance with the California Environmental Quality Act.
“The project’s environmental impact report is underway and we aim to have that finalized in the first quarter of next year,” Julian told supervisors. “That would allow the project to begin construction by the end of next year and complete construction and open for occupancy by the end of 2025.”
Hymel said a lottery will be conducted to determine which county employees get to live there. He said residence may be limited to five to 10 years to spread the benefit among more people.
Dorfman said currently, Marin County, MCOE and Education Housing Partners are drawing up a memorandum of understanding (MOU), which will in turn serve as the basis for creation of the joint powers authority.
Hymel said he plans to bring the MOU to the Board of Supervisors by the end of this year for adoption. The plan is to complete the joint powers authority no later than the end of next year.
Several supervisors said they would like to explore the possibility of shaping the joint powers authority so it can be used to create similar projects in the future.
“I could see this as a model for other projects that we do,” said Supervisor Stephanie Moulton Peters.
Mary Jane Burke, Marin County superintendent of schools, said, “I love the idea that this JPA could be formed in a way that would allow it to serve multiple projects around the county. Indian Valley College seems to be our first next best place where we might move forward.”
