$465,000 city loan for 13 affordable homes at 36 Airport Road

In plain English

The City would lend Habitat for Humanity Monterey Bay $465,000 to help build 13 affordable, owner-occupied single-family homes at 36 Airport Road. The money comes from a state grant the City already received (the Permanent Local Housing Allocation, or PLHA, under Standard Agreement No. 22-PLHA-17794) and would be appropriated out of the City's Affordable Housing Fund (0221). A yes vote approves the loan agreement, promissory note and deed of trust, and authorizes the City Manager to sign the loan and subordination documents. The loan has a 30-year term at zero percent interest, secured by a deed of trust on the property.

Thirteen income-eligible first-time homebuyers could buy homes at a City-set affordable price, with affordability, owner-occupancy and resale rules that apply to each unit in perpetuity, and Habitat must first try to market the homes to people who live and/or work in Watsonville.

Key facts

• $465,000 loan to Habitat for Humanity Monterey Bay; 30-year term, zero percent (0%) interest starting on the date of disbursement.
• 13 single-family, owner-occupied units on a 41,560-square-foot site at 36 Airport Road (APN 015-391-20 & -19).
• Funds come from the state Department of Housing and Community Development PLHA program, Standard Agreement dated June 13, 2023 (Contract No. 22-PLHA-17794); appropriation is from Affordable Housing Fund (0221).
• Buyers must be first-time homebuyers at or below the state low-income limits, must live in the home as their primary residence, and the City must approve each buyer and the sales price before escrow closes.
• The City conveyed the property to Habitat at nominal cost on November 13, 2018; the Council approved the density bonus and subdivision map on October 22, 2024 (Resolutions 224-24 and 225-24).