City manager lays out affordable housing commitments, project requests and funding gaps
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Summary
City Manager Sanders told the Charlottesville City Council on Dec. 15 that the FY27 housing budget includes several multi‑million dollar commitments (South 1st Phase 2: $6M; 6th Street Phase 1: $3M; West Haven: $15M phased), new requests from developers and nonprofits, and a $3M gap on Candlewood/Kendallwood Phase 4 that may reduce unit counts unless additional funding is found.
City Manager Sanders presented a housing and budget briefing to the Charlottesville City Council on Dec. 15, reviewing current affordable housing commitments, incoming requests from developers and nonprofits, and several programmatic risks that could require council decisions in January.
Sanders listed projects already reflected in the budget: South 1st Street Phase 2 ($6,000,000), 6th Street Phase 1 ($3,000,000) and a $15,000,000 West Haven redevelopment commitment to be phased (first $5,000,000 slated this year). He identified additional city commitments and requests in development pipelines, including Kendallwood (Piedmont Housing Alliance) projects, VISTA 29 (permanent supportive housing; city support of $936,000 requested), and an $8,700,000 acquisition/loan servicing figure for Carlton Mobile Home Park.
On specific pipeline requests, Sanders said 501 Cherry has a current city commitment of $3,150,000; Piedmont Housing Alliance has asked for an additional $700,000 plus a $1,000,000 performance grant to support the project and to fund the shell of a proposed on‑site grocery space (Sanders emphasized the city funding would support shell infrastructure and would not itself guarantee a grocery store).
Sanders described Candlewood (also referenced as Kendallwood) Phase 4 as a particularly complex issue: the CIP currently includes $4,500,000 committed for Phase 4 but staff identified a $3,000,000 funding gap that could reduce the anticipated unit delivery from 425 total units across phases to 388. Sanders said the city is preparing a January work session so council can decide whether to accept fewer units or close the funding gap.
He reviewed recurring program funds and relief efforts: the city contributes annually to the CIP in support of affordable housing (the presentation cited a $1.05–$1.5M contribution range and an annual $10,000,000 commitment as the policy standard), the HOPS program at $575,000, and the Charlottesville Supplemental Rental Assistance Program (SISRAP) at $900,000 proposed for FY27 (supporting 68 households at or below 30% AMI). Sanders said staff will evaluate SISRAP in early 2026 and may recommend program adjustments or incremental expansions using carryover funds rather than new CIP allocations.
Sanders told council he is tracking a potential federal disruption to permanent supportive housing funding that, if realized, could leave roughly 31–32 people without direct assistance and may require local backfilling. Council members raised concerns about rising costs since the pandemic, the risk of LIHTC affordability periods expiring, and the need for stronger land acquisition strategies to preserve long‑term affordability. One council member noted the intervention assessment that led to the $10,000,000 commitment is now outdated and that inflation and construction costs have increased the estimated need considerably.
On next steps, Sanders said the administration will provide council with links to full project applications on the city's NDS housing page, schedule a January work session focused on Kendallwood/Candlewood Phase 4 and other hot topics, and hold three community budget sessions in January (6–8 p.m. on three nights) ahead of the March 2 budget presentation and an April 9 adoption date.
Council then moved into a closed session to consider appointments under the Virginia Freedom of Information Act.
Sanders' presentation included specific dollar figures and identified areas where staff will return with more detail; council did not take final votes on any of the project requests during the Dec. 15 session.
