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Habitat for Humanity project in Yuba City faces funding gap; HCD grant ties complicate scaling back
Summary
Habitat for Humanity's proposed Merriment Village, a planned 217-unit multifamily project on Walton Avenue, has a funding gap for Phase 1. Staff said the project's HCD grant is tied to a specified unit count, limiting the group's ability to scale the project down without reducing grant funds.
Habitat for Humanity’s proposed Merriment Village, a planned 217-unit multifamily development on Walton Avenue, is facing a funding gap for the project’s initial phase, Yuba City planning staff told the planning commission.
Staff member Libby said Habitat is working with banks and other partners to close the gap and that the city council has expressed continued support for the project. “It’s taken a long time,” Libby said, adding that construction costs and tariffs have pushed up project expenses.
Libby told commissioners the grant money the project received from the California Department of Housing and Community Development (HCD) is tied to development of a specific number of housing units. Because of that requirement, Habitat cannot simply reduce the unit count for a first phase without affecting the grant amount, Libby said. “They don’t have the flexibility to say, okay, let’s just shave off a certain number of units and continue to build,” Libby said.
Commissioners asked whether a smaller Phase 1 could proceed independently; Libby responded that Phase 1 currently has a gap and that closing it is a focus for the applicant.
No formal action or vote on the project occurred at the meeting. Staff said they will continue to update the commission and council as Habitat works to secure financing.
