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Council approves 501(c)(3) bond documents to preserve affordability at Creek at 2645 Apartments
Summary
The Sacramento City Council approved final bond documents allowing a 501(c)(3) transaction to fund acquisition and phased rehabilitation of the 368‑unit Creek at 2645, with affordability restrictions and on‑site resident services; councilmembers pressed SHRA on local control and welfare tax exemption impacts.
The Sacramento City Council voted to approve final bond documents authorizing a 501(c)(3) bond financing for the Creek at 2645 Apartments, a 368‑unit multifamily development that the project team says will be preserved and rehabilitated under nonprofit ownership.
Keisha of the Sacramento Housing and Redevelopment Agency (SHRA) told the council the planned transaction would allow Integrity Housing, the proposed nonprofit owner, to renovate exterior and interior elements over time and keep affordability restrictions in place: 40% of units restricted at 60% of area median income (AMI), 35% at 80% AMI and the remaining 25% at market rate. SHRA said Project Access will provide at least 20 hours per week of resident services, including after‑school programming.
Council members raised concerns about the welfare tax exemption and local control. One council member representing the district where the project sits urged SHRA and developers to coordinate closely with the council and neighborhood stakeholders, noting that property tax exemptions can affect city and special‑district revenues and that past projects generated constituent questions about outreach and remedies. Keisha and SHRA staff described underwriting and oversight steps SHRA uses and said the nonprofit bond structure helps ensure reinvestment in the property rather than rent increases.
John Letgan of Art House Partners, the project sponsor, introduced himself and confirmed Integrity Housing would be the 501(c)(3) owner and AMC Management would serve as property manager. Letgan said a subset of older units will receive more comprehensive renovations and that interior unit upgrades will occur over time as units turn over.
A council member moved the item, it was seconded and the council recorded an affirmative vote; the council noted no public speakers on the agenda item. The approved action authorizes staff to finalize the bond documents and proceed with the financing steps described in the staff report.
Why it matters: The approved bond documents and welfare tax‑exemption pathway are intended to preserve a large affordable housing stock in place rather than allowing a private purchaser to renovate to market rents, but the council’s questions underscore ongoing tension about local oversight and the fiscal effects of property tax exemptions.
Next steps: SHRA and the project sponsor will complete closing steps for the 501(c)(3) bond transaction and begin phased rehabilitation and resident services as described to the council.
