The County of Santa Clara


Approve delegation of authority to the County Executive, or designee, to negotiate, execute, amend, or terminate agreements such as development agreements, regulatory agreements, funding agreements, ground leases, loan agreements, deeds of trust, and promissory notes with Mercy Housing Management Group, in connection with the planning, funding and development of Palo Alto Educator Workforce Housing at 231 Grant Avenue, in Palo Alto, CA, following approval by County Counsel as to form and legality, and approval by the Office of the County Executive. Delegation of authority shall expire on August 13, 2020. (Facilities and Fleet Department)


Department:Facilities and Fleet DepartmentSponsors:
Category:Delegation of Authority


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As stipulated in the Request for Proposals (RFP), the project will rely on a financing plan that includes non-County funding, a ground lease and a combined $12 million investment of County, City of Palo Alto, and participating school district funds. Previously, at the April 17, 2018 Board of Supervisors Meeting, the Board set aside $6 million in the Countys Stanford Affordable Housing Fund for its share of the $12 million investment.


On February 14, 2019, Facilities and Fleet Department (FAF) issued RFP-FAF-FY19-0175, Palo Alto Educator Workforce Housing Development, which was posted on BidSync and closed on May 13, 2019. The Review Board evaluated four proposals based on the Lead Developers written proposals and interviews, utilizing evaluation criteria that included developer experience, architect experience, property management experience, developer concept and preliminary site plan, financing, and cost control innovations. Evaluation of the written proposals and presentations/interviews were conducted on June 25, 2019.

The top score was given to Mercy Housing Management Group, comprising of Mercy Housing and Abode Communities. These two organizations have experience successfully working together and leasing properties that include priority or set-aside units for teachers. Abode Communities also has experience building teacher housing in Southern California. The development teams concept takes into consideration the local communitys desire to preserve trees and allows for separating the site into two projects, giving greater flexibility in the development of the site.

Because of the above items, Delegation of Authority is requested to negotiate and execute the development agreement with Mercy Housing Management Agreement for the Palo Alto Educator Workforce Housing Development.


This action will have no/neutral impact on children or youth.


This action will have no/neutral impact on seniors.


This action will have no/neutral sustainability implications.


On January 23, 2018, Item 11, the Board of Supervisors (Board) unanimously approved Supervisor S. Joseph Simitians Board Referral, Consider recommendations relating to the creation of housing at 231 Grant Avenue, Palo Alto site. The actions approved by the Board included directing Administration to seek out a partner to develop the 231 Grant Avenue site, resulting in the RFP process. Subsequently, on April 17, 2019, the Board approved Item 15, Consider recommendations relating to funding for teacher/staff housing at 231 Grant Avenue in Palo Alto, directing the Administration to set aside $6M in the Countys Stanford Affordable Housing Fund to support the development of the aforementioned below-market-rate housing project.


The County would not negotiate a development agreement with Mercy Housing Management Group at this time.


The Clerk of the Board will follow the regular process for this type of file.

Meeting History

Aug 13, 2019 9:30 AM Video Board of Supervisors Regular Meeting

President Simitian requested that Administration remove the words "Palo Alto" from the Palo Alto Teacher Housing title on subsequent documents, as future projects may address regional issues that are not limited to Palo Alto.

Vice President Chavez requested that Administration provide an off-agenda report to the Board on date uncertain relating to establishing a consistent framework for assessing and comparing development projects, terms and conditions for leveraging public dollars, total public and private investments, and partnerships with developers.

MOVER:S. Joseph Simitian, President
SECONDER:Cindy Chavez, Vice President
AYES:Mike Wasserman, Cindy Chavez, Dave Cortese, Susan Ellenberg, S. Joseph Simitian