REPORT TO COUNCIL
SUBJECT
Title
Approve a $4 million Contribution to Sunnyvale Community Services ("SCS") and Authorize the City Manager to Execute and Administer an Equity Sharing Agreement Giving the City an Equity Share in Property Owned by SCS Located at 1160 Kern Avenue in Proportion to the $4 Million City Contribution
Report
BACKGROUND
Sunnyvale Community Services ("SCS") is an independent, nonprofit emergency assistance agency, founded in 1970. Their mission is to prevent homelessness and hunger in our local community. The City and SCS have a long history of collaboration and provide services supporting vulnerable City residents.
In 2020, SCS purchased a building located at 1160 Kern Avenue for their new headquarters using several funding sources including a traditional bank loan. SCS identified a need to liquidate that loan to reduce exposure to the volatile banking and lending market, as well as free up operating cash to continue delivering services to the community. In Spring 2023, SCS and the City began discussing how the City might assist and in August 2023 agreed to an equity sharing agreement that would give the City an equity interest in the Kern Avenue property in proportion to the City contribution of $4 million. SCS would use the City funds to pay off the bank loan.
EXISTING POLICY
Council Policy 5.1.1 Socio-Economic
Goal 5.1G: Enhance the provision of health and social services to Sunnyvale residents by providing opportunities for the private marketplace to meet the heal and social service needs of City residents.
ENVIRONMENTAL REVIEW
The action being considered does not constitute a "project" with the meaning of the California Environmental Quality Act ("CEQA") pursuant to CEQA Guidelines section 15378(b)(4) in that it is a fiscal activity that does not involve any potential significant impact on the environment.
DISCUSSION
In exchange for $4 million, the City and SCS propose to enter into an Equity Sharing Agreement that would give...
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