HomeMy WebLinkAboutResolution No. 2026-48 | SLA Affordability Covenants | Adopted 07/27/2026RESOLUTION NO. 2026-48
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF GILROY AUTHORIZING THE RECORDATION OF
AFFORDABLE HOUSING COVENANTS OR
RESTRICTIONS ON FOUR CITY-OWNED PARCELS
PREVIOUSLY DECLARED SURPLUS PURSUANT TO THE
CALIFORNIA SURPLUS LAND ACT
WHEREAS, the City of Gilroy previously declared four City-owned parcels as surplus land in
compliance with the California Surplus Land Act (SLA), including APN 841-06-001 located at
7491 Railroad Street, APN 841-04-020 located at 7780 Monterey Road, APN 799-15-027 located
at 7289 Rosanna Street, and APN 799-15-026 located at 7351 Rosanna Street (collectively, “the
Properties”); and
WHEREAS, the SLA establishes mandatory procedures that local agencies must follow prior to
disposing of surplus property, including issuing a Notice of Availability (NOA) to eligible
entities, conducting good faith negotiations for not less than 90 days with qualified respondents,
and, when applicable, recording affordable housing covenants or restrictions to satisfy State
housing requirements; and
WHEREAS, on December 1, 2025, the City issued the required NOA for the Properties and
subsequently engaged in good faith negotiations with eligible affordable housing developers and
public agencies as required by Government Code Section 54223; and
WHEREAS, consistent with prior City Council direction, staff negotiated toward a sale at fair
market value to ensure compliance with State law and uphold the City’s fiscal responsibilities,
but the parties were unable to reach agreement on price or terms during the statutory 90-day
negotiation period; and
WHEREAS, the required negotiation period concluded without an executed agreement, thereby
completing the SLA negotiation process for the Properties; and
WHEREAS, pursuant to Government Code Section 54222.5, when the SLA negotiation process
concludes without a qualifying transaction, the City is required to record affordable housing
covenants or restrictions on the surplus property prior to taking any future disposition action; and
WHEREAS, the required covenant establishes baseline affordability obligations for any future
development of ten or more residential units on the Properties, including the requirement that at
least 15 percent of such units be affordable to lower income households, with affordability
maintained for 55 years for rental units and 45 years for ownership units, and requiring ownership
units to be initially occupied by lower income households and to include an equity sharing
agreement consistent with Government Code Section 65915(c)(2); and
Docusign Envelope ID: 9AD8BF67-B224-8682-823A-06618C872F69
Resolution No. 2026-48
SLA Affordability Covenants Resolution
City Council Regular Meeting | July 27, 2026
Page 2 of 4
WHEREAS, these affordability requirements run with the land and are enforceable against
current and future property owners pursuant to Government Code Section 54222.5; and
WHEREAS, the recordation of these covenants ensures the City’s continued compliance with
State law and provides clear expectations for any future purchaser or developer regarding the
affordability obligations applicable to the Properties.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Gilroy hereby
authorizes and directs the City Administrator, or designee, to record affordable housing covenants
or restrictions on the following City-owned surplus parcels:
•APN 841-06-001 (7491 Railroad Street)
•APN 841-04-020 (7780 Monterey Road)
•APN 799-15-027 (7289 Rosanna Street)
•APN 799-15-026 (7351 Rosanna Street)
BE IT FURTHER RESOLVED that the covenants or restrictions, attached hereto as Exhibits
A through D, shall include the affordability obligations required under the California Surplus
Land Act, including but not limited to the requirement that any future residential development of
ten or more units reserve at least 15 percent of units for lower income households, that rental units
remain affordable for a minimum of 55 years, that ownership units remain affordable for a
minimum of 45 years, and that ownership units include an equity sharing agreement consistent
with State law.
BE IT FURTHER RESOLVED that upon recordation of said covenants or restrictions, City
staff is authorized to proceed with any subsequent disposition actions for the Properties in full
compliance with the Surplus Land Act and all other applicable laws.
PASSED AND ADOPTED this 27th day of July 2026, by the following roll call vote:
AYES: COUNCIL MEMBERS: BRACCO, CLINE, FUGAZZI,
MARQUES, RAMIREZ, BOZZO
NOES: COUNCIL MEMBERS: NONE
ABSTAIN: COUNCIL MEMBERS: NONE
ABSENT: COUNCIL MEMBERS: HILTON
Docusign Envelope ID: 9AD8BF67-B224-8682-823A-06618C872F69
Resolution No. 2026-48
SLA Affordability Covenants Resolution
City Council Regular Meeting | July 27, 2026
Page 3 of 4
APPROVED:
___________________
Greg Bozzo, Mayor
ATTEST:
_______________________
Kim Mancera, City Clerk
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Resolution No. 2026-48
SLA Affordability Covenants Resolution
City Council Regular Meeting | July 27, 2026
Page 4 of 4
CERTIFICATE OF THE CLERK
I, KIM MANCERA, City Clerk of the City of Gilroy, do hereby certify that the attached
Resolution No. 2026-48 is an original resolution, or true and correct copy of a City Resolution,
duly adopted by the Council of the City of Gilroy at a Regular Meeting of said Council held on
Monday, July 27, 2026, with a quorum present.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the Official Seal of
the City of Gilroy this Wednesday, July 29, 2026.
____________________________________
Kim Mancera
City Clerk of the City of Gilroy
Docusign Envelope ID: 9AD8BF67-B224-8682-823A-06618C872F69
City of Gilroy 7351 Rosanna Street
Gilroy, California
95020-6197
Telephone (408) 846-0219
http://www.cityofgilroy.org
Matt Morley
City Administrator
Covenant or Restriction to be Recorded
(per Government Code Section 54233)
7491 Railroad Street, Gilroy, CA 95020
If ten (10) or more residential units are developed on 7491 Railroad Street, Gilroy, CA 95020, a
Cannery/Downtown District zoned commercial site (Parcel ID 7843; APN 841-06-001), not less
than 15 percent (15%) of the total number of residential units developed on the property shall
be sold or rented at affordable housing cost, as defined in Section 50052.5 of the California
Health and Safety Code, or affordable rent, as defined in Section 50053 of the California
Health and Safety Code, to lower income households, as defined in Section 50079.5 of the
California Health and Safety Code. These units shall remain affordable to and occupied by
lower income households for a period of 55 years for rental housing and 45 years for
ownership housing. The initial occupants of all such ownership units shall be lower income
households, and the units shall be subject to an equity sharing agreement consistent with the
provisions of paragraph (2) of subdivision (c) of 65915 of the California Government Code.
These requirements shall be covenants or restrictions running with the land and shall be
enforceable against any owner who violates a covenant or restriction and each successor-in-
interest who continues the violation by any of the entities described in subdivisions (a) to (f),
inclusive, of Section 54222.5 of the California Government Code.
By: ____________________________
Matt Morley, City Administrator
City of Gilroy
Date: July 27, 2026
Docusign Envelope ID: 9AD8BF67-B224-8682-823A-06618C872F69
City of Gilroy 7351 Rosanna Street
Gilroy, California
95020-6197
Telephone (408) 846-0219
http://www.cityofgilroy.org
Matt Morley
City Administrator
Covenant or Restriction to be Recorded
(per Government Code Section 54233)
7780 Monterey Street, Gilroy, CA 95020
If ten (10) or more residential units are developed on 7780 Monterey Street, Gilroy, CA 95020,
a Downtown Extension District zoned commercial and public facility well site property (Parcel
ID 6317; APN 841-04-020), not less than 15 percent (15%) of the total number of residential
units developed on the property shall be sold or rented at affordable housing cost, as defined
in Section 50052.5 of the California Health and Safety Code, or affordable rent, as defined in
Section 50053 of the California Health and Safety Code, to lower income households, as
defined in Section 50079.5 of the California Health and Safety Code. These units shall remain
affordable to and occupied by lower income households for a period of 55 years for rental
housing and 45 years for ownership housing. The initial occupants of all such ownership units
shall be lower income households, and the units shall be subject to an equity sharing
agreement consistent with the provisions of paragraph (2) of subdivision (c) of 65915 of the
California Government Code.
These requirements shall be covenants or restrictions running with the land and shall be
enforceable against any owner who violates a covenant or restriction and each successor-in-
interest who continues the violation by any of the entities described in subdivisions (a) to (f),
inclusive, of Section 54222.5 of the California Government Code.
By: ____________________________
Matt Morley, City Administrator
City of Gilroy
Date: July 27, 2026
Docusign Envelope ID: 9AD8BF67-B224-8682-823A-06618C872F69
City of Gilroy 7351 Rosanna Street
Gilroy, California
95020-6197
Telephone (408) 846-0219
http://www.cityofgilroy.org
Matt Morley
City Administrator
Covenant or Restriction to be Recorded
(per Government Code Section 54233)
7289 Rosanna Street, Gilroy, CA 95020
If ten (10) or more residential units are developed on the public facility parcel identified as APN
799-15-027 at 7289 Rosanna Street, Gilroy, CA 95020 (Parcel ID 9459), not less than 15
percent (15%) of the total number of residential units developed on the property shall be sold
or rented at affordable housing cost, as defined in Section 50052.5 of the California Health and
Safety Code, or affordable rent, as defined in Section 50053 of the California Health and
Safety Code, to lower income households, as defined in Section 50079.5 of the California
Health and Safety Code. These units shall remain affordable to and occupied by lower income
households for a period of 55 years for rental housing and 45 years for ownership housing.
The initial occupants of all such ownership units shall be lower income households, and the
units shall be subject to an equity sharing agreement consistent with the provisions of
paragraph (2) of subdivision (c) of 65915 of the California Government Code.
These requirements shall be covenants or restrictions running with the land and shall be
enforceable against any owner who violates a covenant or restriction and each successor-in-
interest who continues the violation by any of the entities described in subdivisions (a) to (f),
inclusive, of Section 54222.5 of the California Government Code.
By: ____________________________
Matt Morley, City Administrator
City of Gilroy
Date: July 27, 2026
Docusign Envelope ID: 9AD8BF67-B224-8682-823A-06618C872F69
City of Gilroy 7351 Rosanna Street
Gilroy, California
95020-6197
Telephone (408) 846-0219
http://www.cityofgilroy.org
Matt Morley
City Administrator
Covenant or Restriction to be Recorded
(per Government Code Section 54233)
7 351 Rosanna Street, Gilroy, CA 95020
If ten (10) or more residential units are developed on the public facility parcel identified as APN
799-15-026 at 7351 Rosanna Street, Gilroy, CA 95020 (Parcel ID 8807), not less than 15
percent (15%) of the total number of residential units developed on the property shall be sold
or rented at affordable housing cost, as defined in Section 50052.5 of the California Health and
Safety Code, or affordable rent, as defined in Section 50053 of the California Health and
Safety Code, to lower income households, as defined in Section 50079.5 of the California
Health and Safety Code. These units shall remain affordable to and occupied by lower income
households for a period of 55 years for rental housing and 45 years for ownership housing.
The initial occupants of all such ownership units shall be lower income households, and the
units shall be subject to an equity sharing agreement consistent with the provisions of
paragraph (2) of subdivision (c) of 65915 of the California Government Code.
These requirements shall be covenants or restrictions running with the land and shall be
enforceable against any owner who violates a covenant or restriction and each successor-in-
interest who continues the violation by any of the entities described in subdivisions (a) to (f),
inclusive, of Section 54222.5 of the California Government Code.
By: ____________________________
Matt Morley, City Administrator
City of Gilroy
Date: July 27, 2026
Docusign Envelope ID: 9AD8BF67-B224-8682-823A-06618C872F69