The Affordable Housing Challenge

A Brown Bag OLLI presentation, featuring:
•  Chris Dart of The Danco Group
•  Beth Matsumoto of the Rural Communities Housing Development Corporation

This is the video and transcription of the OLLI Brown Bag Lunch Presentation from December 12, 2022, on the Affordable Housing Challenge. It is about 1 hour 20 minutes long.

With Chris Dart, president of the Danco Group and specialist in construction of affordable housing, and Beth Matsumoto, Director of Multifamily Development of the non-profit Rural Communities Housing Development Corporation. Jane Woodward, moderator.

As a developer with much experience, Chris Dart knows what it takes to build affordable apartments. Included in his presentation are these statements:

• You’re not seeing a lot of market rate apartments being done. Because the cost to produce a market rate apartment would really, for a median household, be more like 50% of their income would have to be spent on housing to afford that.
• In general, the cost of construction goes up substantially when you go above four-story construction. It’s pretty unfeasible, for the cost of construction, to be able to build that high [eight stories].
• The California Code allows you to do five stories of wood. But if you were to go above five, you’d have to do concrete podium foundation or podium construction. And that gets into a higher cost.
• We have not been able to find a market-rate model that works. The cost to build is so high that our rents would have to be extremely high to be able to bring a market rate project into production. 

Included here is the video, with the PowerPoint slides from Chris Dart and Beth Matsumoto, and a full transcription of their presentations. Questions for the Chris Dart starts at about 43 minutes on the video. Beth Matsumotor’s talk starts at about 48:30. Questions for both participants start at about 58 minutes.

Jane Woodward  03:47
Welcome all and we’re happy to see you here. It’s a nice chilly morning. I think it’s the lowest temperature we’ve experienced. My dog thought it was a little interesting to walk on the crusty, frigid lawn.

Anyway, welcome to Chris Dart, who is president of Danco Communities. His extensive experience and knowledge in the development and construction industry spans over 30 years with the Danco Group. He pioneered the affordable housing endeavors of Danco Communities and continues to be the visionary principal of the Development Department at Danco. He’s involved in land acquisitions, design development, entitlements, and financing strategies, and has built a vast knowledge in obtaining various forms of local, State, and Federal government funding for his projects.

Danco Communities specializes in developing affordable housing projects by obtaining funding from organizations such as TCAC, USDA ID, HOME, and the Community Development Block Grants. I think it’s something like that. I’m going to go ahead and hopefully be able to, I’m going to introduce Beth in case she gets here. She got stuck with jury duty. So I we got notice of this about 9:15 this morning, and it’s like she hoped to be out of there, but it could be she’s not going to get — she’s not going to make it. So, we’ll hope she does.

She’s had 20 years of experience in nonprofit affordable housing. She holds a Masters degree focused on sustainable community development from HSU, and a Bachelors from University of Colorado Leeds School of Business. After working in corporate management, she shifted gears in pursuit of creating something that endures and improves lives. This new path led her to nonprofit housing. From there she learned to navigate the complex but rewarding field of developing and preserving affordable housing tells me the basic needs of our community members. In 1915 [corrected: 2015] she was selected as the recipient of the Northern California Nonprofit Leadership Achievement Award for her contribution to affordable housing. As the Executive Director of Housing Humboldt based in Arcata, she helped to facilitate a formal partnership with the Rural Communities Housing Development Corporation [RCHDC] to strengthen the nonprofit housing sector in Humboldt County and the surrounding region. She’s now the director of multifamily development for the Rural Communities Housing Development Corporation. So we hope she makes it but just in case, Chris, it’s all yours. And thank you so much for coming.

Chris Dart  06:38
All right, thank you, Jane, that when you’re introducing Beth that I think the award must have been 2015, not 1915, because I would make her 107 years old.

Jane Woodward  06:50
That’s kind of interesting. Oh, my goodness, I forgot a century.

Chris Dart

Chris Dart  06:59
Thank you for having me. I recognize some of the faces and names on the screen. I appreciate the opportunity to be able to speak and present today, I have two PowerPoints to show. One is just kind of talk about who Danco is and what we’ve been up to, and showcase some of our recent projects to give you a sense of what we’ve been doing. And then the next – I’ll end that one and then we can, you know, chat about it and anybody can ask questions or curiosity. It’s just really just a presentation about some of the projects that we’re doing or have done recently.

And then, in preparation for this talk, I met with Jane Woodward prior. And we talked about what is affordable housing to us. What is it? What’s going on at the State level? How’s it feasible? When I go into the feasibility, I’ll actually show you some numbers. I brought one of our financial models to share, so you can see kind of the costs that go into the projects. What are the challenges? We’ll talk a little bit about my take on the Gateway Project. And then what’s going on at the State, and what could we look at, what changes could we make to make things better? And then we can, along the way I’ll just pause at different moments and we can ask questions or have discussion.

Jane Woodward  08:30
The good part is Beth just arrived. Hi, Beth! Congratulations on making it.

Chris Dart  08:41
All right. So I’ll go into my first share here. And let’s see if I can share my screen. Can you all see the PowerPoint? Yes. Okay. Let me start that. All right. So, again, my name is Chris Dart. I’m the president of Danco Communities with the Danco Group. I’m just going to showcase a few of our projects.

You know, really to start I think Danco really focuses on being a community member and doing projects that improve the community, it’s actually in our mission. So when we think about the projects that we do, we really try to make a difference, make an impact, and produce high-quality projects that are a benefit to the community. Not just in terms of housing, but also services or whatever the need would be, whether it be family housing, supportive housing, senior housing or market rate housing — or all of the above. We really try to pick and choose our projects that will make a difference. That’s how we select our projects moving forward.

The picture you see here is a project that we completed in Eureka called Bayview Heights. It’s 50 units for formerly homeless veterans and just general population. Danco Group is, we are we call ourselves vertically integrated, which is a fancy word for that we do development, construction, and property management. In development we are focused primarily on affordable housing, We do do a little bit of single-family, maybe a few commercial projects at the local level. But primarily our offer is affordable housing.

We also do construction, wer’e a couple of hundred people in our construction team. We self-perform framing, concrete, painting, roofing, you know, really a lot of the different trades in construction, and we build all of our own projects. And then in addition to that we are a property management company, where we manage all of our properties. We are working — as you’ll see from some of the projects that I show, that I’m showcasing — all over the State of California as well as Oregon and Arizona.

Again, this is the Bayview Heights project that we just finished in Eureka. permanent supportive housing. It’s a three-story project with lounges and game rooms, on all levels, fitness center, rooftop garden, community kitchen. It was a $22 million project, 51,000 square feet and 51 units. And this has been in service now for about, I think it’s been in service for just over two years. And it’s been a huge success in being able to house previously homeless residents within our community.

Chris Dart  12:30
Here’s a project we just completed in Gilroy, in student services for several years. This is a 75 unit senior housing project. It’s 100% seniors, but 50% of the units are supportive housing for seniors that are or were experiencing homelessness and then 50% just general senior housing. It’s very nice project, four stories. Monterey Gateway in Gilroy, California.

Some projects some of you may be familiar with. We just completed out on the peninsula of Samoa. It’s a $31 million project. It’s 80 units, 10 buildings, mostly three-story construction. What’s unique about this project is that all of the units have garages. So every resident here was able to have their own garage. And then the community building is a four-story building. And within the community building we offer support services. We have 20 of our units are for homeless families. So folks that were families with children that were experiencing homelessness within our community, we were able to set aside 20 units for those families, and then work with Department of Health and Human Services to provide services for all those residents. So that’s a very nice facility. It’s been in service now for just over a year.

This is our project that we just completed in Arcata, this is downtown Arcata, called Sorrel Place. It is a four-story building, many of you probably know it. It’s 44 units, family housing. There’s featuring one to three bedrooms. There’s a picture of the community center in the lower right. And the project’s been in service for about eight months now. And we’re very proud of this building and it’s a very nice amenity. It also was financed with affordable housing sustainable community funds, which gave quite a few dollars to the City of Arcata for transportation improvements including an electric bus and several sidewalk road improvements that are in support of this project.

Here’s a project that many of you probably don’t know about which we just completed down in Santa Rosa. This is similar to the Eureka Bayview project except for it’s not specific for Veterans. This is called Sage Commons. It’s 54 units, 100% supportive housing, that we have folks that were experiencing homelessness. Mostly studio apartments. It’s been in service for about eight months.

And then here’s a project we just completed in Fort Bragg, California. We call it The Plateau. 69 units. This project is interesting in that it has three different target populations. 23 of the units are for seniors, 20 of the units are supportive housing, and then 25 of the units are family townhomes. So we have three different population types on one campus. It’s an eight-acre site. And just placed in service this month, it’s just filling up now. It’s down in Fort Bragg, just overlooks the Noya River.

Here’s our largest project to date that we’re doing in downtown San Jose. This is really like in the heart of the city. This is a 90,000 square foot, seven-story project. It’s 80 units in total — 56 one-bedrooms, 23 two-bedrooms. It’s 40 of the units will be set aside as supportive housing, and then the other half just general population. We’re under construction on it now.

This is a project that we’re currently working on in in Eureka. It’s on 7th and Myrtle This is a three-story, 36 units, three-story senior housing project featuring one or two bedrooms and 69,000 square feet. This is one of the financial models I have to show you if we have time about how this project is feasible. In Eureka, many of you probably know it, it’s off of 7th and Myrtle.

And then on the other side of the State down in Moorpark, California, this will be our largest project. This is a 200-unit apartment complex, eight buildings, that we’re currently procuring financing for, and we’ll start construction first quarter 2023. It’s in Ventura County, Moorpark, California, large family apartments in that community.

And then finally, we are, as many of you know, we’re renovating the peninsula of Samoa. We have 200 homes out here and we’re restoring the historic town of Samoa piece by piece. We’ve been working on it now for 25-plus years. We do have all the approvals in place. We are rented currently renovating the single-family existing homes and selling them, and then putting in new infrastructure. I think today we’ve sold around 38 homes there and are continuing to offer those for sale. The renovations include a commercial area on Vance Avenue, a business park, revitalizing the Cookhouse, expanding the Maritime Museum, the new camping area. There is a new residential single-family homes component, which is in this area in the flat. Live-work studios, new roads, trails, pathways, park, all new utilities including wastewater treatment, water tanks, corporation yard, utility substation, and fire station. So this is a pretty exciting project. It’s going to provide a lot of different housing types for much in need for many of our community members.

Here are some pictures of some of the remodels that we’ve recently completed — 200 Vance, 783 Vance, and 20 Vance, some pictures of what they look like exterior and interior. They’re turning out pretty nice.

And that’s it for that slide presentation. I will pause and see if there’s any questions or comments on any of our recent projects and what we’re up to, or anything say about that.

Jane Woodward  19:47
I have I have a question, if nobody else does. How did you end up — did you have to buy the entire area of Samoa in order to do what you’re doing? Did everybody sell? How did that work? Have you gotten funding for that for affordable housing. or is that considered affordable housing?

Chris Dart  20:07
Yeah, great question. So the town about 26 years ago went up for auction. The town was — it’s an old mill town. It was owned by what was Pacific Lumber Company, and then also Simpson Lumber over the years. And so it went up for auction. And the company [Danco] formed an LLC with other local investors and submitted a bid, and won the bid. The project has been financed to date all by private capital. And it has been — some we have been able to bring in financing for the affordable housing project that we did out there through Federal grants and local grants and State money. But otherwise, the town itself has been financed through private equity and private placement loans through banks.

Jane Woodward  21:06
Do you expect to sell those properties? The houses and things, or retain them as rentals?

Chris Dart  21:15
All of the property has been subdivided through the Coastal Commission approvals, and the Humboldt County planning approvals to the Planning Commission and Board of Supervisors. And the plan is to sell the existing houses. All the land out there is subdivided into individual parcels and we have been selling off single-family residences as we renovate them. They are, I would say, this is considered affordable housing. I mean, in terms of price point, our houses at Samoa are, I would say, lower than maybe a new construction project, new subdivision. The price points out there are able to be less because they’re renovations. And then, you know, some of the houses we are renovating and some of the people that are buying the houses actually want to do some of the work themselves. So there’s options. And then there’ll be a new construction component to it, which will be just traditional single-family residential homes that will be built adjacent to the existing single-family.

Jane Woodward  22:32
Does anyone else have a question? Yeah, Nancy.

Nancy 22:36
I’m wondering about the projects in our local areas. What’s the availability? Are they filled? Are they on a list? How do you find that out?

Chris Dart  22:48
Currently, we’re working with — You mean for the properties that are for sale?

Nancy
For sale, for rent for whatever. What’s the availability for seniors, say?

Chris Dart  22:58
Well, the properties are being listed. The single-family homes are being listed through Benchmark Realty. So if anybody has an interest in buying a home, you can contact Mark Burchett at Benchmark Realty who is our listing agent. And then if you’re interested in renting, you can contact the Danco offices at 707-822-9000. And there’s a list of available rentals. And it’s also on our website at www.danco-group.com.

Jane Woodward  23:32
I take it that most of your projects are rentals?

Chris Dart  23:36
Well, actually out in Samoa most of the properties will be home-ownership. But we do have the affordable housing property that we built out there which is all for rent.

Jane Woodward  23:51
JoAnn, you have a question?

JoAnn Schuch  23:54
Thank you, Chris. This is a great presentation. What is the acreage for the 7th and Myrtle project? And are there elevators in the building?

Chris Dart  24:02
It’s a very small acreage. It’s just over an acre of buildable area that we’re building on. I believe it does have an elevator. Yes, it’s one building with elevator access to all stories.

Jane Woodward  24:19
Did you have something further, JoAnn? Did you want to – No, okay. Patricia Ann wanted to ask about Sea Level Rise with respect to Samoa?

Chris Dart  24:34
Yeah, all of the all of the new construction is required to be elevated off of the — to a different elevation than floor level. So if you notice that’s why the townhomes that we built out there are have garages underneath for in the event of a tsunami or high tide or a tidal inundation, as they would call it. And so the facility has been designed basically to take that into consideration and any new construction has to be considered at those higher elevations for the living quarters.

Jane Woodward  25:16
I see only one of these projects went over four stories, for the most part. You did do one seven story. Is that, is it harder to do a seven-story building and make it affordable?

Chris Dart  25:32
Absolutely. And that kind of goes into my next presentation, which would be yet to answer your question, Jane. Yes. Once you get over — the California Code allows you to do five stories of wood. But if you were to go above five, you’d have to do concrete podium foundation or podium construction. And that gets into a higher cost. The project that I flashed on the screen down in San Jose, which is a seven story building, it has two buildings of concrete and then five buildings of wood frame. So your cost goes up substantially. When you’re working in an urban setting, like San Jose, the cost of land is substantial, and so to justify those costs, given that the land costs so much. I think it’s a little harder to do here in a rural area where land is not as expensive. It’s that there’s a pricing point where it becomes unfeasible to go higher. Which is why you probably don’t see a lot of multi-story tall buildings in the area because really — practically speaking — it’s not feasible. Maybe I should go in, I want to make sure I leave enough time for Beth. Which I want to target that. So how much time do you think more do you think I should go before we go on?

Jane Woodward  26:58
Oh, another the 10 minutes or so.

Chris Dart  27:00
Okay. All right. So I’m going to bust through my next PowerPoint here which will probably bring up a lot of questions. And let me just pull that up here.

Chris Dart  27:44
So I have plenty of content here to go over but I will make sure that I keep it short and sweet so you [Beth] have time to share yourself. So I just am going to go through and present, I probably won’t go into the details of the financial plan for 7th & Myrtle.

Affordable Housing

Chris Dart  27:56
So what is Affordable Housing as we know it. When I say “we” I mean Danco. So affordable housing to Danco — and Danco’s model is really subsidized multifamily housing. Also known as apartment buildings that are subsidized. This is primarily what we do when it comes to affordable housing development, construction, and property management. Those affordable housing projects come with regulatory agreements and those regulatory agreements restrict the rents [to] below fair market value. And really they’re 60% or below the area median income. The median income in Humboldt County is about 50,000 a year. That’s 49,000 something, but rounded up is about 50,000 a year. “Median” meaning 50% of the people make more and 50% of the people make less. So 50,000 annual income per family. So our affordable housing has a regulatory agreement that restricts that we rent them to families earning 60% of median and/or below. We finance those with Federal, State, and local grants and forgivable loans. There are public / private partnerships, they have public investment but private ownership. So that there’s public funds and private accountability. And then they have a component of this traditional debt, through permanent housing, funding permanent financing with debt. And they are permanent housing, not temporary housing.

Some of the misconceptions of affordable housing, I think, like to talk about — just because it’s affordable housing doesn’t mean it’s cheap or inexpensive. In some cases the housing is more expensive than traditional housing, because a lot of the funding agencies really want to see high-quality projects. And you’ll notice that some of the affordable housing projects are a lot better quality than some of the market rate housing. It’s not housing for the poor necessarily. Many of our residents are working families or there are seniors on fixed incomes. They’re not halfway houses — we hear some of this stuff at public hearings. They are not temporary housing or shelters. And they’re not government-owned or run housing projects. These are privately owned, government financed.

Some of the history of affordable housing is the Affordable Housing Act. It’s been around since 1937, in which the Housing Authorities were formed. That was the Federal government was loaning money to States and communities for what they called low-cost construction. We don’t think about it as low-cost construction any longer. It’s thought of as affordable housing or lower income, but that doesn’t necessarily translate to low costs of construction. The Public Housing Authorities traditionally would build public housing projects, meaning that the housing authorities would build them and own them. And there’s still some of that going on. In 1974 Congress enacted the Housing Choice Voucher Program, which allowed low-income housing residents could live anywhere that accepts Section Eight vouchers. That program is still going and going strong. Many of the residents that live just in regular market rate housing, but they have a voucher. So they’re able to live anywhere and help offset the cost of their rent.

But, really, the way most new construction affordable housing is done in today’s world is through the Section 42 Tax Code, which is the Low Income Housing Tax Credit Program. And so the IRS essentially allocates tax credits to developers to develop low-income housing, or housing that’s 60% below area median income, which becomes the primary source of financing for projects. And most of the projects that we do are done with that program today. Most of the projects that are done in in the country are done and financed with the Low Income Housing Tax Credit Program.

Feasibility, how are they financed. They are financed typically through a combination of grants and loans from Federal, State and local agencies. As I mentioned, low income housing tax credits, those credits are issued to developers and developments that are then syndicated or sold to companies that have high tax liabilities, and then they put their funds in upfront. That becomes equity in the project. And then they have hard debt loans or traditional bank financing, construction, and permanent financing.

I was going to review this Sources and Uses Pro Forma but I will not do that now, since time is short here.

How do developers get paid? You know, these developments are not like your traditional way of thinking about a traditional real estate capital or transaction. A traditional real estate transaction, you’d be looking at a return on invested capital, or cash-on-cash or cash flow, or you would build a property and sell it and get a return on the capital you  invested. Really in the affordable housing projects, we don’t have any invested capital. We invest some capital up-front, we’ll carry the projects until they close on construction financing. But then developers are reimbursed 100% of their capital into the project. And then we are paid developer fees. In the case of us, we do construction, we get construction fees and property management fees. So I only bring this up because it’s a different model than what we traditionally see where, you know, you get together a group of investors, they make an investment there, they keep the investment in. There’s cash flow from the development, they get cash return on that cash flow. Affordable housing projects — because the rents are lowered– there’s generally not cash flow in the projects, and any cash flow that’s there is used to pay that property management, keep the utilities, lights on, and service small loan from a bank.

What are some of the challenges? Some of the challenges are regulations laws. You know, the environmental reviews are pretty extensive. I mean, it can take — In the case of Samoa it took 20 years to get that project through, approved through the Coastal Commission and the County of Humboldt. That’s 20 years of investment in that project before ever being able to bring in one dollar back from any sales. Local approvals can be challenging. It can take, you know, months to get through the approval processes, with land use approvals, public hearings, Planning Commission, design review, City Councils. State and Federal land use laws are challenging to navigate. And it can be difficult and time-consuming, which can make the project take a long time.

Some of the other challenges are: Costs. We’re in unprecedented times. Some of the sources of the cost increases are supply chain issues from COVID, the war in Ukraine, the trade war in China. We’ve never seen costs like we’re seeing today. Some of the — we’ve had some costs in some of the trades have doubled in the last 36 months from what they were three years ago. And it’s a really rapidly changing environment, it’s hard to predict. We’ve got subcontractors that are not willing to pricing. When we put projects out to bid we’ll have subcontractors say, Well, I’m not going to give you a number because I’m not sure what it’s going to cost by the time I get around to my part. And so that’s a challenge. We have lumber cost fluctuations, and really an unpredictable future around costs, which makes it challenging for developers who have to commit up front what these projects are going to cost.

Also some of the challenges are NIMBYs — Not In My Backyard. You know, we hear that common phrase: “I like affordable housing. I just think it belongs somewhere else.” That would be the definition of a NIMBY.

Chris Dart  37:00
We have a project in Chico, for example, we just presented it a couple of weeks ago. It’s on a site that’s zoned multifamily and it’s been zoned multifamily for 20 years. We’re proposing it to do everything, for all required setbacks, all the required heights requirements, we’re within the density. And yet the community is still trying to stop the project. A lot of times NIMBYs will use CEQA or environmental laws to stop projects, when the reality is it’s just covering up for not wanting the project and wanting to build somewhere else. Well, these delays drive up costs, and delays and approvals can drive up carry costs, make some unpredictability and makes doing development very challenging. In addition, there are limited resources. You know, all of the financing for affordable housing that we go after is competitive. The tax credits are generally oversubscribed three to one, meaning they’re able to fund one project for every three applications that go in, and sometimes even more than that. And then some of the funding from housing and community development funding resources are five to one oversubscribed. So there’s not enough money to go around to create affordable housing is the moral of that story.

What is the State and the Fed doing? The State of California has been great. I mean this administration has been all-in on housing and specifically low-income housing. The governor’s top priority has been housing and in ending homelessness. Since this administration has taken over, we’ve seen billions of dollars that have come into play since they began. We’ve also seen a lot of by-right legislation passed meaning projects are exempt from CEQA — affordable housing projects — and are able to move forward without land use approvals, which has really opened up a lot of opportunities for projects to get unstuck. Throughout there we’re dealing with NIMBY issues or environmental issues. And some of the some of the problem with that, though, is that many of those projects, if you’ve used those by-right approvals they trigger prevailing wages. So that’s a tough one to balance because then that increases the cost of the project. But since this administration has taken effect and so much money has come through the system, many of Danco’s project pipeline has freed up and we’ve been able to get projects unstuck and able to move forward because there have been additional resources that have come into play more than what there had been in the past.

What more can be done? I mean, I’ve just read some statistics in preparation for this. Freddie Mac estimates that as a country we’re about 3.8 million units short of meeting the need. The Federal government spent $90 billion on housing assistance in 2021. Yet, we’re still short 3.8 million units. I think we’ve got to get the mindset needs to change. And we’ve got to get the costs down and the barriers to getting housing done. We need to stand up to NIMBY groups. We need to reduce regulations for infill development and more by-right approvals. The cost of development, it’s got to go down. I mean some of our projects average, just in fees alone and impact fees, average $20,000 per unit in development impact fees, and then we’ve seen them as high as $50,000 per unit. These are fees for sewer, water, environmental impact fees. Which I get, they’re real, but they’ve gotten so high that it’s making projects challenging and less affordable.

And then some of the some of the amenities that features that are prioritized. You know, I think that the mindset should be that we ought to get the housing first. I’m all about the amenities and doing high-quality projects, but there’s a balance. And then I think the mindset there’s been in the past — with this backlog, this demand — is we got to slow the process down. I say the opposite, we need to speed the process up. We’re in a crisis and the mindset change from slow down to hurry up, because we need several million housing units. And we’re not getting there. And it continues, that gap continues to grow.

I already kind of spoke about the Gateway.  I’m going to skip that, I’m just quickly in this.

My last slide is on what about Market Rate. We need all kinds of housing, not just affordable. The cost to build is rising up between $300 to $400 per square foot, that’s our just cost of construction is up to $300 to $400 a square foot. HUDs general rule is that one-third of your income should be spent on housing.

[The HUD figure is a maximum, and includes utilities. The figure is 30% of net income maximum – that is, after taxes.  It is not a general rule that says one-third of your income “should” be spent on housing.]

If the median income in Humboldt County is $50,000 per year, that means $16,000 per year for housing or $1300 per month.

[Note:  The HUD figures are for all housing expenses including utilities. So this would be $1300 per month for rent, water, PG&E, etc.]

On the low end, that were our housing projects are costing about $400 per door. Well, the cost of capital is $24,000 per year, that’s about $8000 short of what somebody would need to cover the housing cost at a market rate housing, — which is why you’re not seeing a lot of market rate apartments being done. Because the cost to produce a market rate apartment would really, for a median household, be more like 50% of their income would have to be spent on housing to afford that and people would just rather make other choices.

So that’s it. Sorry to rush through that. But there’s a lot there. And we’re here to answer a few questions before we turn it over that.

Jane Woodward  43:01
We have some on the chat, basically, which we’ll start with. What about mass timber, that the City of Arcata keeps talking about in terms of higher story buildings?

Chris Dart  43:14
I don’t have any experience with mass timber. I think we have looked into it. And it’s relatively new. But I do think that it is something that could be done in the future. It’s just we don’t have a lot of experience in it.

Jane Woodward  43:32
And Andrew Whitney commented that Humboldt County median income for 2022 for a family of four is $80,400. Does that help or I don’t know what the medium income is.

Chris Dart
Yeah, I was speaking for a one-person household.

Jane Woodward
One person, okay, that makes a huge difference. Sherri Starr has a question. Sherri, would you unmute?

Sherri Starr  43:59
Hi, there. Are the projects such as Sorrell Place — Are they going to be affordable in perpetuity? Or I have heard that projects such as these revert to market rate after 30 years. Which is correct?

Chris Dart  44:14
The projects have a regulatory agreement on them for 55 years. So all of the projects that we’re doing that have tax credits are regulated for a 55-year period. And that’s pretty typical on the projects that are built today.

Jane Woodward  44:34
Who ends up owning these houses, who ends up owning the properties? Investors?

Chris Dart  44:43
They’re owned by limited partnerships. So they’re owned by those general partners and limited partners. And general partners are typically the developer. So Danco, as well as a nonprofit group, are the general partners of the development or the ownership structure. And then the limited partners are investors who buy the tax credits,

Jane Woodward  45:08
Would you be willing to go back and show us the part about the Gateway project?

Chris Dart  45:16
Well, I think my comments were really around — I think the Gateway project is, I appreciate what’s being tried to be done there, and the conversations have been had. A lot of people asked me, you know, how are we going to build eight-story or 10-story buildings? And how would you be able to do that?

And my answer is: I wouldn’t be able to do that. It’s pretty unfeasible, for the cost of construction, to be able to build that high. Not just for the podium [for five-stories and higher] but also just under construction, being able to get a forklift up. You can pretty much, four stories is as high as you can reach from the ground. So you would need special hoisting equipment, you would need special equipment for your workers, you have to provide elevators during construction. And just overall, in general, the cost of construction goes up substantially when you go above four-story construction. And so, my comments and the questions that I’ve been asked around Gateway, you know, how are you going to do 10-story buildings? And I can’t find a way that that’s going to be feasible.

But what we’re seeing is, we’re seeing that down in the urban — where land is so expensive. In San Jose, it’s $10 million an acre for a piece of property. [Note:  A city block in Arcata is 1.43 acres – so that would correspond to roughly $14 million for an Arcata city block.]  So that’s a different story. When you’re paying that kind of money for property, then your offset of cost of construction to go higher and get more units, you can start to make a feasible analysis. But when you’re, you know, in Humboldt County, you’re maybe, you know, $500,000, or $700,000 an acre. I just don’t see that. [Note: The block at 11th & L in Arcata where Myrtletown Lumber used to be and where the Data Center is now was sold December, 2019. The price was $2,131,500 – this included a 9,000 sq.ft. retail building built in 2013 that the Data Center building was built around.]

Jane Woodward  46:52
And we have a question: Are you seeing $300 per square foot for non-prevailing wage jobs?

Chris Dart  46:59
Minimum. We’re seeing $400 a square foot for non-prevailing wage jobs, depending on the type of construction. A project in Eureka, the senior housing project, is right around $380 a square foot for construction.

Jane Woodward  47:17
And aside from what you’re doing out on Samoa, it, are there home-ownership opportunities? Or what thoughts do you have about that? Can it be done with the funding options you have available from the State and Feds?

Chris Dart  47:34
Well, I think Beth is going to talk about that more, so I’m going to leave that for her to describe.

Jane Woodward  47:41
Okay, are there plug-and-play elevator units for under four stories? What does that mean?

Chris Dart  47:49
I’m not sure what that means.

Jane Woodward  47:51
Andrew, what does that mean?

Andrew  47:53
Is the cost of the elevator technology coming down? Or is it going up like everything else as we try to get more accessible units?

Chris Dart
I mean, it’s going up relative to everything else. I’m not seeing anything extreme around elevators, but the cost of elevators going up just like everything else, just from raw materials and labor.

Jane Woodward  48:15
Any other questions? I think we’ve covered everything. And thank you so much, Chris. And now it’s Beth’s turn. 

Beth Matsumoto

Beth Matsumoto  48:49
Thank you. Hello, everybody.

My name is Beth Matsumoto. I’m a little discombobulated because I didn’t think I was going to get called to jury duty, but I did get called.

I am the Director of Multifamily Development for the Rural Communities Housing Development Corporation. I’m honored to be part of this conversation, especially with our friends from Danco. So we’re similar — We are developers that leverages public and private financing to develop housing. But we’re a relatively small nonprofit. And we operate at a much slower pace.

I was formerly the Executive Director of Housing Humboldt, and I’ll tell you a little bit more about that in a minute.

Beth Matsumoto  49:39
Rural Communities Housing is a private nonprofit organization. It’s governed by a volunteer board of directors. Our lines of service include development, property management, home-ownership, and community building.

We’re a mission-driven nonprofit dedicated to the acquisition, development and management of affordable housing. The organization is based in Ukiah and was founded in 1975, with roots in serving low-income seniors. Housing Humboldt, which is based in Arcata, was founded in 1993 by a group of folks who were concerned with increasing housing prices and stagnant wage rates. I think some of our former board members are on this call. [Name not recognized], Thea Gast was a founding member of us , Name not recognized], and I think Silvia Shaw is on the call, and Elizabeth Conner, who was also a former executive director of the organization.

So as a nonprofit, we rely on fees for managing highly regulated housing and fees for developing new housing. Housing Humboldt grew to include to have 105 units of rental housing and 22 community land trust homes. But the lack of a large enough pool of unrestricted funding in a speculative and competitive industry meant that we would always need a strong fiduciary partner.

We partnered with Rural Communities Housing on a development in Arcata, and then naturally we became an affiliated entity of RCH. And so now, we’re more of a regional nonprofit. We’re serving Humboldt, Mendocino, Siskiyou, Tehema, Lake, and Del Norte counties. We manage over 1,300 units of affordable housing, or housing that’s affordable to low income families, seniors, individuals and special needs populations. We also have a community land trust program, and a self-help program. We also take pride in partnering with our community-based service agencies or social service agencies to provide services to our residents.

Next, I’m going to show you a little bit more about what we have locally in terms of rental housing. And then I’m going to focus a little bit more on our community land trust program.

I don’t know if anyone recalls the Holiday Gardens Motel. [In Arcata, on Alliance Road just south of Stewart Avenue and Murphy’s Market. Now called the Arcata Garden Apartment Complex]. It was a motel that was developed in the mid-60s. It had a swanky pool and actual gas lamps. Well, our organization stepped in in the mid-1990s and converted the motel into multifamily housing. It includes studios, one-bedroom units, two-connected, and three-bedroom units. It was an interesting conversion from a motel that was in disrepair. There was a need for housing that our low-income households could afford. It’s also in the heart of the Gateway Plan. [Note: Beth is incorrect on this – the Gateway Plan does not extend north this far.] So this property could potentially benefit from an expansion of units under the planning policies that are being put in place.

We also have the Bayview Courtyard Senior Apartments on Union Street. We house folks who are 62 and older. This was a 4% tax credit and bond-financed project. Chris did a great job of kind of showing you the data behind all of the projects that we have developed.

We went through a little bit of a change after we developed our senior housing.We started focusing on developing supportive housing for folks who were homeless and mentally ill. In 2015 we tapped into the Humboldt County’s Mental Health Services Act money to develop permanent supportive housing. And this is the one on E Street in Arcata . And we partner with Arcata House Partners and Humboldt County for the services that are delivered to the folks who live there so they can have a better chance at remaining stably housed.

We also just finished another similar development in the Pine Hill neighborhood of Eureka. This is 30 units of studios, one- and two-bedrooms. The Department of Health and Human Services is a service provider as well as Arcata House Partnership, and RCAA. So again, we partner with our community-based nonprofits to help support the residents to stay stably housed.

I’m going to talk a little bit more about our Community Land Trust Affordable Homeownership Program. The Community Land Trust develops permanently affordable homes for folks who are earning limited incomes. Under this model land is held in trust by the non-profit, and title to the homes — homes that are built on top of the land — are kept separate. Low-income households have purchased the homes subject to a 99-year ground lease. By locking the subsidy into land, we’re able to create the affordable homeownership opportunity when the low-income buyer comes in and purchases the home only. A resale formula gives owners a limited return on their investment and keeps the homes affordable to the next low-income households.

The benefits of the Community Land Trust is that we’re really trying to create permanent affordability. Again, the ground leases for 99 years. We’re also locking the public investment in the land and retaining that public investment versus recapturing it. The program promotes economic diversity in various neighborhoods. The benefits of homeownership in general provide asset building opportunities, neighborhood stability, and other social and economic benefits. And the Community Land Trust as the non-profit is the steward of the opportunities. We stay involved with our owners and facilitate resales when an owner wants to sell the home. We keep the homes or we help facilitate that sale to another low-income household.

In 2008, we developed a 10-unit subdivision in the James Creek neighborhood. It was an interesting project because, you know, in 2008 capital basically dried up. In partnership with the City of Arcata, we were able to construct and sell the homes to low-income families as the mortgage industry just basically was overhauled.

This really was our last Community Land Trust project that we developed. We have 22 homes right now in Windsong, Plum Village — which is on Aloha Way [off of West End Road, just north of the traffic circle at the eastern end of Spear Avenue and St. Louis Road], and in Jane’s Creek. But we really haven’t been able to expand our Homeownership Program. We’re hoping to look at new ways, creative ways, to potentially expand these this type of homeownership opportunities in the Humboldt region.

Just to give you an idea of how the affordability has worked, we currently have a home for sale in the Windsong neighborhood where homes are fee simple. [Fee simple means the homes are owned outright by the owner.] The appraised values are $400,000. Our home, which is subject to a ground lease, is for sale for $195,000. It was built in 2004, has three bedrooms, one and a half baths. It’s 1100 square feet, has a PV system and solar hot water and a one-car garage. I’ve provided the income limits there for you. So generally, you know, for a four-person household, you can’t make more than $62,300 on an annual basis.

That’s about it. I need to get back to jury duty in about 10 minutes, but I appreciate being part of this conversation and I’ll open it up to questions.

Jane Woodward  58:31
Beth, thank you so much. I didn’t know you were going to have to go back. I would have had you go…

Beth Matsumoto
No, it’s okay. It’s okay. We have time.

Jane Woodward
Good. What happened when the investments that dried up — I mean, 2008 to come and gone. Why don’t we have more investors?

Beth Matsumoto  58:49
Well, the Neighborhood Stabilization Program came in when the foreclosure crisis was — the government, the State of California, or actually was a Federal program — came in to help communities that were most hurt by the foreclosure crisis. And, unfortunately, in Humboldt County we just weren’t that devastated, according to their data. The Neighborhood Stabilization Program would have helped to meet that public investment in the land. Otherwise, working through the HOME program — which is a Federal program that we tap into the State through — we just we have not been able to create a new program. It’s somewhat price wise, but it’s also we, as a non-profit, we started focusing more on the Mental Health Services Act funding. At that point in time, we’re focusing on permanent supportive housing and have not gotten back to our Homeownership Program.

Jane Woodward  59:48
Let’s see if anybody else has their hands up. Anybody else have any questions for Beth before she can escape and go back to jury duty. Did you end up on the jury? Beth: Not yet. You just have to show up again, in case they call you. Well, thank you for doing that very much, and for making it here. I’m very appreciative. Any other questions from anybody?

I have a question, if not for you, for Chris, and it has to do with the two motels that were converted in Valley West. And I know Danco ended up with one of them and Arcata House Partnership ended up with the other. My understanding is that you’re doing renovations to make them usable. I’m just curious as to who ends up owning it.

Chris Dart  1:00:51
Our project is the formerly Red Roof Inn motel conversion. It’s through a State program called Project Homekey that was born out of the COVID 19 pandemic as one of the Governor’s initiatives in homelessness. The hospitality industry was one of the biggest hit industries during COVID. Many, many hotel and motel owners were going out of business given that nobody was traveling, nobody was staying in hotels. And so the thought was, in addition to that the growing population of homelessness was rising and rising in communities throughout the State. And so the crisis or the emergency is, well, how can we get housing units as fast as possible? We’ve got underutilized hotels, and we’ve got a growing population of homelessness on the street, and therefore, the Homekey program was born. It’s essentially grant funding that you apply for the State through, and you’re able to acquire existing hotels and motels, and convert them into permanent supportive housing. Essentially, it’s a fast track project. So we have one that we converted in Oakland, we have another one that we’re under construction on in Sacramento, and then two others that will be coming next year, one in Oakland and one in Sacramento, and then this one in Arcata. And so, yeah, I mean, the funds come in, they’re owned by a partnership, which is really just — there’s no tax credits involved, it’s just grant money from, in the case of the Red Roof Inn, it comes from the State as well as the City of Arcata and through their CDBG [Community Development Block Grant] program — is what’s funding that. And we’ll in and renovate. There are 78 units, we’ll renovate all of them and turn them into permanent housing. We’re going to remodel some of the common space, so that there’s areas for case workers and recreation activity. And so we’re basically going to convert it into a functional community, into permanent housing, which will have a regulatory agreement as well. The regulatory agreements for affordability are for 55 years, but we really only have a funding plan for the permanent housing side for twenty. So in 20 years, it could convert to just general affordable or we might be able to get additional funding and then extend that for twenty years and continue to offer the same services from that point on.

Jane Woodward  1:03:43
It’s considered very-low income housing, is that correct?

Chris Dart  1:03:47
Yes, it is very-low and extremely-low, and that most of the residents – Well, in order to qualify you have to be either homeless or at risk of homelessness in order to qualify to live in. So generally, the rents that the residents will pay will be one-third of SSI or one-third of their income, and then the rest of the rent is subsidized through housing vouchers or the Homekey program or capitalized operating reserve.

Jane Woodward  1:04:19
And how is the Arcata House Partnership operating? Is it on the same basis?

Chris Dart  1:04:24
That is the same program, same structure. They have a different facility, we are two separate entities but we are working closely and collaborating together on the two properties. But they are working under the same structure.

Jane Woodward  1:04:41
Elizabeth, you have a question?

Elizabeth Conner  1:04:43
Yes. And I’ll also report, just to follow up on that, that Arcata House this weekend moved 60 people into the Grove, the other project that was funded under that. So 60 new people have housing, some of them for the first time in 30 years. which is very exciting.

Jane Woodward  1:05:03
Isn’t there money as part of that for providing services? And is that what you were talking about, Chris, in terms of the service provision limited to 20 years? I heard it was fewer years than that.

Chris Dart  1:05:16
Well, it depends on what you — everybody models differently. We were working with Redwood Community Action Agency as a service provider for the Red Roof Inn. And they’re able to get certain subsidies that come into the project that we’re forecasting out 20 years. Yes, it depends. Our project in Oakland, we have an eight-year subsidy plan. Our project in Sacramento, we have a 30 year subsidy plan. So it just depends on the resources that are available.

Elizabeth Conner  1:05:49
So I actually had a question for Beth Matsumoto.

Elizabeth Conner  1:05:57
And the question is, well, first of all, thank you for the great presentation. And second of all, well, a two-part question, which is:  What do you wish the public knew about non-profit affordable housing development? And the second part of that question is: What can people in the public do to support non-profit affordable housing development?

Beth Matsumoto  1:06:19
I guess, from the nonprofit perspective, we have a relatively small pool of unrestricted funding. And yet we still have to, every deal that we try to develop is highly speculative. We have to compete with a number of other, we have to compete with Danco, we have to compete with other rural organizations out there. So it’s a really, it’s a very challenging marketplace to be in. But we try to. Our strength is in our roots with the community and with our board members, the relationships we have with the other non-profits that help provide supportive services. So I think that’s where it comes from.

Jane Woodward  1:07:15
Great. Thank you. And I guess, maybe a final question, how on earth can we manage to produce affordable home-ownership? Is it economically viable? And can you get State funding and Federal funding to build condos?

Beth Matsumoto  1:07:40
You know, the subsidy is so great that we need. The land costs is so high, the new construction costs is so great. You know, it’s really challenging. I think one of the models that we’re going to look at is going into the existing homes that are in need of community development or rehab or conversion. And so we can, we’ll take a look at that. But it’s going to take a lot of public subsidies to be able to make these affordable to folks who are earning limited incomes and get credit from the private sector.

Chris Dart  1:08:15
We did a project with the City of Arcata, 10 units in there just off of where, some of you know, the Courtyards. We call it we call the Courtyards, Phase Three. [Located on the north side of 299, visible from 299, access from Boyd Road south of Giuntoli, past the bus yard there.] Those are for-sale home-ownership. And we sold all of them. The City got funding from HCD [California Department of Housing and Community Development] as part of their home ownership program, and put a soft second on title, which allowed the borrowers to borrow about 100, I think it was $120,000 less, because the City was able to subsidize with a soft second, and then be able to own those. Those are townhomes, essentially. So it’s being done. We haven’t done a lot of it and it’s not really popular, that program. But we’re looking at another project in Lakeport with a nonprofit group, Burbank Housing, which some of you know in the Santa Rosa area. We’re working with them to develop some for-sale hom-ownership under a similar program So I think it can be done. It does have its challenges, though.

Jane Woodward  1:09:31
Okay. Kay Escarda, you have a question?

Kay Escarda  1:09:42

Congratulations to both of you guys. We’re not meeting our numbers with individual houses although we need all kinds of housing. But I’m really especially interested in seeing more apartments built, because I don’t see how we can meet our numbers without more units available. And so I was wondering, Beth, I put in the chat. Pine Hill is just now finishing up. And do we have anything else in the pipeline plans for this region? I know you work in the five counties. So I don’t want to see Humboldt County get lost in the mix there.

Beth Matsumoto  1:10:34
Yeah, that’s right. I have been working predominantly outside of Humboldt County, unfortunately, as we’re more regional. But we are looking at other properties. We’re hoping to overcome the PG&E crisis that’s happening in Southern Humboldt and potentially developing a conversion of a motel in Southern, in Garberville. And we’re also looking at the City of Eureka, but it is a very challenging and competitive marketplace. I’m sure Chris has more in his pipeline locally.

Chris Dart  1:11:07
We’re always looking. You know, most of our workforce is here locally. Frankly, they’re tired of going out of town working. So our focus is always to serve here locally, as much as the need is and we’ve done quite a bit within Eureka and Arcata, Fortuna and even down in Rio Dell. So we’re looking in different areas to continue to have projects moving forward, including all the communities, Arcata, Eureka, and even in McKinleyville. We don’t have don’t have a lot going now, but we do have Samoa, which is going to produce a lot more single-family for sale. We have a potentially a project in mind in Arcata, we own in the Creamery District, on some property that we own down there. The old Reid & Wright site has potential. And then you we have we’re looking at some stuff out and in Eureka area, sort of the downtown. [Note: The Reid & Wright site is between N and O Streets, between 14th Street and Alliance – that is, behind and north of where Bug Press is on 12th Street, near Alliance.]

Jane Woodward  1:12:10
JoAnn Such asks: Is there a market-rate version of the Danco affordable housing quadplexes in Fortuna?

Chris Dart  1:12:23
I’m sorry, I don’t understand the question. There’s a quadplexes in Fortuna?

JoAnn Schuch  1:12:30
Yeah, you have a really nice, affordable housing development in Fortuna that uses the quadplex model in a triangular shape.

Chris Dart  1:12:45
I think we call it Yarrow village. That’s it. Yeah. And yeah. Do we plan on doing that elsewhere? Yes.

JoAnn Schuch  1:12:55
Have you already built a market-rate housing with that model?

Chris Dart  1:12:58
Oh, no, we haven’t been able to find — like I was trying to explain in my presentation — we have not been able to find a market-rate model that works. The cost to build is so high that our rents would have to be extremely high to be able to bring a market rate project into production.  Usually, you can notice that any of the multifamily market-rate housing that’s being done, it’s generally around the university, because they’re able to charge more rents for the student housing. And they [the students] double up and basically charge by the room. But we haven’t been able to find a successful market-rate model, although what we are working to do is to incorporate some market-rate units within an overall mixed-income project, because that market is being underserved. And then in addition to that, at the State and Federal level, the State is starting to recognize and the Feds are starting to recognize that middle income was being left out. And so there are lots of conversations around programs that are on the horizon, to serve the needs of those folks that are at 80% to 120% of AMI [Area Median Income]. So funds start to open up, subsidy funds start to open up for those target populations. And we’ll start to see more of that.

Jane Woodward  1:14:25
Andrew commented: The price to build a 1300 square foot home at $350 per square foot is $455,000 not including the land. That’s a huge problem. I mean, when we moved here in 2008, when we bought it in 2007, we calculated it was about $150 per square foot. So that’s a huge, huge increase. And we got a 1998 home.

Chris Dart  1:14:58
Yeah, I mean, one of the things I was going to show everybody is my financial model. There’s a lot more that goes into real estate development than construction costs. There’s design, there’s engineering, there’s finance fees, there’s impact fees, permit fees, carrying costs, environmental review, surveys and market studies, and Phase One assessments. Constructions, albeit the largest line item in the development budget – also there’s land — but it’s probably 60% to 70% of the costs. And then there’s additional 30% and other costs.

Jane Woodward  1:15:38
What’s the reality of having either manufactured housing brought in? Or they’re now talking about 3D printed housing? Is any of this stuff viable here? And could we get it? Would it be viable to do.

Chris Dart  1:15:57
I mean, it’s out there. Modular construction is one of the current execution strategies for a lot of apartment builders. In fact, one of our close colleagues and good friends, who has partnered with us on many projects here in Humboldt, opened up a modular plant in in Idaho. And the challenges around modulars is transportation. Getting to Humboldt County with the big semi trucks that carry these modular units is really infeasible — they can’t get here. So they have to be accessed through close to a railway. Essentially, they’re able to do modular in the Bay Area, and in the big cities. But going over some of these mountain roads and rural towns it’s impractical and not really possible. I know Hoopa Modular has done some — when that was going up in Hoopa — and they’ve been able to get some of that modular stuff and prebuilt prefab going. But at a large scale, we haven’t really seen it. We’ve done one project that was modular in the Chico area, and it worked out. I mean, our costs were about 15%. We’re not very good at it. We only did one and it was years ago, you have to kind of do them over and over and over again to build that expertise. But, yeah, people are doing it and it’s one of the strategies in order to get the cost down.

Jane Woodward  1:17:23
Do we have the local expertise in terms of carpentry, electricians, plumbers, etc, that we need to build the kind of housing we project we need.

Chris Dart  1:17:34
Definitely a challenge. I think trade schools, the CR trade school is good. Any other trade schools that could form. We have a large crew that we keep busy, but it’s definitely a dying trade. It’s interesting that a lot of the younger generation aren’t getting into this work. We have a few but we definitely have an aging workforce out there with the expertise in carpentry and those types of trade skills that seem to be fading away.

Jane Woodward  1:18:08
That’s a huge problem. And then I passed one issue, Julie Vaissade-Elcock [Chair, Arcata Planning Commission] indicated she’d love to hear how the 7th and Myrtle project [Eureka] got built.

Chris Dart  1:18:24
You mean, how it got funded? It was funded through funds from the City of Eureka. They committed a million-two ($1,200,000) into the project. It was funded through an infill infrastructure grant program through the Housing and Community Development, which we also used on many of the projects in Arcata including Sorrell. And it was funded with low-income housing tax credits, and then Humboldt County Housing Authority allocated project-based vouchers on all 36 of the units as well, which that subsidy was able to increase debt financing. So yeah, we applied to the State, I think for five years in a row and, and struck out for many, many times. And finally were able to get it on the last go-around and get it over the finish line. But it’s a challenge. I mean, senior housing, unfortunately, is on the bottom of the priority list. For the three housing types — being supportive housing, family housing, and senior housing – the State funds the least amount for senior housing. It’s the third priority out of the three housing types. And so whenever a Senior, 100% Senior Housing Project, is trying to compete, it’s definitely the most challenging to get funded

Jane Woodward  1:19:58
And last but not least, I would be very interested in knowing what you think can be built in the Gateway Area, given the constraints of part of it being in the Coastal Zone, part of it being subjected to potential sea level rise within 20 to 30 years, the infrastructure issues etc.

Chris Dart  1:20:20
Well, I think there’s a lot going on there, for sure. I mean, there’s a lot of hoops to jump through with the Coastal Commission and being able to get your Local Coastal Plan approved. But I do think that it’s wise to do infill development, and there’s a lot of underutilized properties down on the Gateway. And there’s a lot of resources downtown. You know, you’ve got all your public transportation, you’ve got your, pretty much everything you need down in the area. I think there are a lot of challenges, but I think there’s also a lot of opportunity down there. The City of Arcata is proven to be a lively, the downtown area has been a lively place to be, and I think the housing contributes to that. I think it’s pretty ambitious, but I also think that it’s as appropriate as anywhere. I would rather see a built infill, then to spread out and go into the hills and make it more difficult for some of the amenities and transportation and infrastructure that’s already in place.

Jane Woodward  1:21:25
Anybody have any other questions or comments or what have you? Then I want to say thank you ever, ever so much for this wonderful presentation and sharing all this with us and, and Beth for making it here despite the situation with jury duty. So we really appreciate it. And we will say this is the close of the Fall session of Brown Bag Lunches, and we resume on January 23. And hope you all have a wonderful holiday season. And we’ll look forward to seeing you in the New Year. And hope you’ll join up with OLLI if you haven’t already. We’d love to have you as members. So we look forward to seeing you then.

Chris Dart  1:22:16
Thank you, everybody.