[00:00:03]
[1.01 Roll Call]
WELCOME TO TODAY'S SPECIAL BOARD MEETING.I'D LIKE TO CALL THIS MEETING CALLED TO ORDER, AND I'D LIKE TO GET A ROLL CALL, PLEASE.
TRUSTEE. DON GREEN RESIDENT TRUSTEE.
JAMES CODY BIRKEY PRESIDENT TRUSTEE SANDRA SALAZAR.
PRESIDENT TRUSTEE ZURICH LEWIS PRESIDENT TRUSTEE MARIANA PACHECO PRESIDENT.
STUDENT TRUSTEE. HECTOR LEDESMA.
PRESIDENT TRUSTEE SHIN LIU IS ABSENT.
TRUSTEE MARISA PEREZ WILL BE ARRIVING SHORTLY AND PRESIDENT.
SUPERINTENDENT FIERRO PRESIDENT.
[1.02 Pledge of Allegiance]
AND THE NEXT ITEM? PLEDGE OF ALLEGIANCE. I'D LIKE TO ASK TRUSTEE LEDESMA TO LEAD US.PLEASE PUT YOUR RIGHT HAND OVER YOUR HEART.
ONE NATION, UNDER GOD, INDIVISIBLE, WITH LIBERTY AND JUSTICE FOR ALL.
THANK YOU. AND THE NEXT ITEM IS THE AGENDA ORGANIZATION.
ANYONE LIKE TO MAKE ANY CHANGES? I DON'T KNOW IF WE COULD.
DO WE HAVE ANY COMMENTS TODAY? NO. NO COMMENTS.
[2.01 Institutional Presentation: Student Housing Grant Application]
DO WE HAVE A PRESENTATION? YES. GOWDY.SO WE'RE RESTARTING AND I'LL GET BACK TO YOU SHORTLY.
[00:14:59]
AND NOW. CAN YOU HEAR ME?[00:15:15]
ANYONE FROM SERVATIUS?[00:15:16]
CAN YOU HEAR ME? HUH? ARE YOU? CAN YOU HEAR US? YES, SIR. DO YOU HEAR ME? YEP. SEEMS TO BE WORKING NOW.THERE'S GOING TO BE A BIT OF A DELAY.
SO IF WE DON'T IF YOU DON'T HEAR US GETTING BACK TO YOU, IT'S PROBABLY THE DELAY.
PRETEND LIKE IT'S INTERNATIONAL CORRESPONDENTS.
WOULD YOU LIKE ME TO START NOW? YES, GO AHEAD. GO AHEAD AND GET STARTED.
OKAY. GOOD EVENING. THANK YOU FOR HAVING ME AGAIN.
I'M HERE WITH US. WITH ADAM BROWN.
A LOT OF EDUCATION, PREPARATION, RESEARCH AND WORK.
WELL, HERE TO GIVE YOU AN UPDATE ON YOUR SB 169 FORDABLE FEDERAL HOUSING GRANT APPLICATION AND TO ADDRESS SOME OF THE QUESTION OF THE BOARD PROVIDED OR GAVE US THE LAST 10%.
SO TO START, WE'RE STILL LOOKING AT 336 BEST PROJECT.
ALL THE BEST BEING KNOWING COMMENCED OF AN AVERAGE OF 330 GROSS SQUARE FEET PER BED.
THAT'S A GOOD SIZE. THAT'S ENOUGH TO GET IT IN THE LARGE, BUT THEY'RE NOT TINY.
THE GOAL BEING TO PROVIDE A GOOD PRODUCT FOR YOUR STUDENTS FOR DECADES TO COME, NOT JUST THE ONE THAT WILL SQUEEZE IN AND MAXIMIZE EVERY PENNY AT THE EXPENSE OF LONG TERM FUNCTIONALITY AND COMFORT.
IT ALSO PROVIDES THE COLLEGE THE ABILITY TO SHRINK THE UNITS.
SO WE'LL FIGURE LET'S BE CONSERVATIVE.
THE APPLICATION IS MOSTLY COMPLETE.
WE'RE DOWN TO SMALL DETAILS WHICH ARE A FULL DRAFT SHOULD BE ON THIS WEEK OR PROBABLY BY TOMORROW.
SO THAT'S A SCHEDULE FOR THAT.
ASSUMING THE COLLEGE IS AWARDED THE APPLICATION, WHICH IS OUR GOAL, YOU WOULD HAVE ROUGHLY $80 MILLION IN FUNDING TO BUILD THIS ALMOST 400 BEDS.
IT WOULD HAVE TO NOT EXCEED $717 PER MONTH.
IT COULD BE LOWER, IT CAN BE WAY LOWER.
THIS CANNOT EXCEED THAT AMOUNT.
THAT AMOUNT IS 10% BELOW THE MAXIMUM ALLOWED BY THAT FORMULA.
[00:20:03]
SO WE SOLVE FOR MAKING SURE WE MAXIMIZE THE POINTS WHILE LEAVING THE COLLEGE, THE FLEXIBILITY TO LOWER RENTS MORE OR RAISE THEM UP WITHIN THAT GAP AS NECESSARY. OVER THE DECADES AHEAD.THE DEVELOPMENT OF A MINIMUM PART OF THIS BUDGET WILL NOW BE PARTIALLY DISTRICT FUNDING AND PART OF THE BOARD'S ENTHUSIAST SUPPORT FOR FINDING WAYS TO SUPPORT A PROJECT IN OUR LAST CONVERSATION IS THE REASON THAT THAT'S PART OF THE PACKAGE. SO KUDOS TO YOU.
WORK WITH ABOUT SIX COLUMNS THIS SUMMER SUPPORTING THE PROJECT SOMEWHAT.
I THINK IT'LL IMPROVE YOUR CHANCES OF SUCCESS DRASTICALLY IF SOMEONE BEATS THE PEOPLE PROGRAM VERY SIMILAR TO WHAT WE SHOWED TWO MONTHS AGO, WE MAKE ONLY MINIMAL CHANGES TO THE DESIGN, NOTHING SUBSTANTIAL, AND THAT'S THE PLAN AS A COMBINATION OF DOUBLE AND SINGLE OCCUPANCY BEDROOMS. SO THERE ARE TWO MANY QUESTIONS TO THE QUESTIONS.
THE BOARD LAST ONE WAS ABOUT PARTNERSHIPS AND ONE WAS LOCAL FUNDING.
THAT'S THE PARTNERSHIPS. FIRST, IN THE CONTEXT OF THE GRANT SCORING PARTNERSHIPS ARE BETWEEN A U, C OR A CSU AND A COLLEGE.
THIS IS A DEAL. WOMAN COLLEGE IS ADJACENT OR VERY, VERY NEAR.
ONE OF THE FOUR YEAR UNIVERSITIES.
AND IT WAS AFTER OUR ANALYSIS OF THIS, WE DID NOT THINK THAT THIS LOCATION AND CURRENT RELATIONSHIPS MADE AN IDEAL CANDIDATE FOR FOR THIS PROGRAM. WE BELIEVE AT LEAST ONE COLLEGE WILL BE TAKING ADVANTAGE OF IT IN THE APPLICATION PROCESS.
UNFORTUNATELY, YES, BECAUSE IT IS TEN POINTS.
ONE OF THEM COULD BE. WE JUST AREN'T AWARE OF IT.
I KNOW ONE. DO YOU HAVE ANY QUESTIONS ON THAT PART? ON THE ON THE PARTNERSHIP PIECE? DON'T WE HAVE A CURRENT EXISTING PARTNERSHIP THROUGH TEACHER TRACK WITH CAL STATE, LONG BEACH? AND WOULD THAT QUALIFY IN ANY WAY FOR THAT? NO. WE DO HAVE A TEACHER TRACK PARTNERSHIP AND AMONG OTHER PARTNERSHIPS WITH HLB, BUT THIS IS SPECIFICALLY TO SHARE THE HOUSING.
I SEE. THANK YOU. SO IN THE SECOND PIECE WAS THE LOCAL CONTRIBUTION.
SO EFFECTIVELY, THE DOLLARS HAVE AN IMPACT IN TWO PLACES.
ONE IS IN THE FIRST CATEGORY OF THE SCORING RUBRIC, WHICH WE'LL SEE NEXT, WHICH IS WHAT HOW MANY DOLLARS THE STATE IS FUNDING PER DAY. SUPERBAD COST 200 GRAND AND CAUSES FLOATING 50,000 PER BED.
THE STATE'S ONLY SCORING IS $150.
SO THE OTHER SCHOOL WAS AT 160.
BUT THEY WERE ASKING FOR FULL FUNDING FROM THE STATE.
AND YOU HAVE A LOWER COST FOR MEDICAID.
AND AND AFTER THE LAST MEETING OF THE BOARD, WITH THAT PRESENTATION TO THE BOARD AND YOUR FEEDBACK IN THE PLANNER NOW IS TO HAVE A $12 MILLION COMMITMENT FROM CERRITOS TO THE PROJECT.
SIX POINTS IS A LOT. THERE ARE VERY, VERY FEW THINGS YOU CAN DO TO MOVE THE NEEDLE ON BUDGET.
I THINK YOU HAVE A VERY COMPETITIVE APPLICATION AND COST BENEFIT.
[00:25:05]
DOLLARS AND GENERAL FUND RESERVE DOLLARS TO COME UP WITH WITH THE $12 MILLION.AND SO WE WERE SHOOTING FOR AROUND TRYING TO HIT THE 15% MARK.
THAT'S THAT'S WHERE WE WERE WE'RE LOOKING AND FELT COMFORTABLE.
ANY MORE THAN THAT, YOU KNOW, WOULD WOULD REALLY BE PUTTING STRESS ON OUR GENERAL FUND RESERVES TO BE ABLE TO TRY TO COME UP WITH THAT. SO THAT WOULD BE A MAXIMUM.
AND I THINK CAPTURING SIX POINTS IN IN THE POSSIBLE TEN IS IS OUTSTANDING.
I DON'T I THINK THIS WOULD PUT US IN A VERY HIGHLY COMPETITIVE MARK TO BE ABLE TO SAY THAT WE'RE ABLE TO CONTRIBUTE AND AND ATTAIN THE 6.6 OUT OF THE TEN POINTS ON THAT.
AND I THANK YOU BOTH AND HELEN PHILIPPE.
SO PART OF THE STRATEGY BEHIND THIS IS OBVIOUSLY TO DO HOUSING AROUND A PRICE POINT THAT ACTUALLY BENEFITED THE STUDENTS AND ALLOWS A REALISTIC POINT OF ENTRANCE WELL, MAXIMIZING OR POINT ALLOCATION TO GET FUNDED. AS YOU PROBABLY SAW DURING THE GOVERNOR'S BUDGET, $250 MILLION WERE TRANSFERRED FROM THIS YEAR TO 2025, WHICH MEANS THAT IT'S GOING TO BE ONLY 500,500 MILLION AVAILABLE FOR FUNDING, OF WHICH HALF OF THOSE ARE AVAILABLE TO THE COMMUNITY COLLEGE DISTRICTS AND TO THE CSU.
SO YOU SEE, PUT IN AN EDUCATION PACKAGE THAT IS COMPETITIVE IN THE WAY OF POINTS.
IT'S IMPORTANT BECAUSE IT IS OUR BELIEVE AND BASED ON HOW PREVIOUS ALLOCATIONS OF OTHER FUNDINGS HAVE GO ACROSS THE STATE IS THAT THIS IS PROBABLY GOING TO BE DISTRIBUTE ACROSS ALL THE REGIONS OF THE STATE, NOT NECESSARILY ALL IN ONE REGION. SO IF WE RECEIVE APPLICATIONS FROM MULTIPLE REGIONS, I'M ASSUMING THAT CONSIDERATIONS ARE GOING TO BE GIVEN TO DISTRIBUTE THE RESOURCES IN THE MOST EQUITABLE MANNER ACROSS THE STATE.
SO WITH THIS SYSTEM, WHAT WE'RE TRYING TO DO IS GET THE HIGHEST NUMBER OF POINTS POSSIBLE WHILE AT THE SAME TIME MAKING SURE THAT OUR PRICE POINT IS LOW ENOUGH FOR THE STUDENTS TO REALISTICALLY AFFORD HOUSING AND TO HIGH ENOUGH SO WE CAN RUN THE HOUSING PROJECT. RIGHT? SO IT'S A VERY FINE BALANCE ON ASSURING THAT WE OFFER A VERY COMPETITIVE PRICE WHILE AT THE SAME TIME ENSURING THAT OVER TIME WE CAN HAVE A SMALL SURPLUS THAT WE WILL ESSENTIALLY SAVE IS EXCLUSIVELY FOR REPAIRS AND MAINTENANCE OF THESE FACILITIES.
I THINK. TOTAL AMOUNT OF POINT IS 80, 80 POINT, 31 POINTS.
WHAT WE'RE AIMING FOR, WHICH WILL PUT US IN A RELATIVELY COMPETITIVE BRACKET.
OKAY. BUT IT'S JUST A REMINDER OF EVERYTHING THAT GOES INTO THIS PRETTY ROBUST PROCESS.
AND AS I SAID, WE'VE BEEN WORKING VERY DILIGENTLY ON IT FOR THE LAST FEW DAYS.
SO ALL OF THIS SHOULD BE IN AN OPINION FILE BY HOPEFULLY TOMORROW.
AND IF NOT, PROBABLY, AS I SAID BEFORE, A CALL TO STAFF TO REVIEW THIS COMMISSION TO REVIEW AND FOR US TO MAKE EDITS ON SUCH OVER THE NEXT WEEK AHEAD OF THE SUBMISSION ON THE 25TH.
AND THEN THE LAST SLIDE IS THE FOREVER BRIDGE.
IT'S A RISK BECAUSE THE RISK COULD BE WRONG OF MAKING AN ESTIMATE.
SO THE FIRST ONE IS THE MAXIMUM POSSIBLE POINTS AS LAID OUT BY THE CHANCELLOR'S OFFICE.
THAT PART IS EASY. AGAIN, THOSE COPY THEIR NUMBERS.
THERE ARE FEW SLIDES BECAUSE WE JUST DON'T KNOW.
AND THEN THE THE RIGHT COLUMN IS THE ESTIMATE.
SO, FOR EXAMPLE, THE STATE FUNDING FOR LOW INCOME BANDS FOR LOW INCOME STUDENTS.
THE TOP SCHOOL IN THE REGION, WE HAVE 15 POINTS MIDDLE AND WE HAVE TEN POINTS.
[00:30:02]
WE THINK THANKS FOR YOUR CONTRIBUTION AND THANKS TO SOME EFFICIENCIES FOR FUNDING THE CARPENTRY FACILITIES AND BEING ABLE TO BENEFIT FROM THE INVESTMENT ALREADY BEING MADE IN THIS PART OF CAMPUS TO THE HEALTH CENTER.THEY WILL BE ABLE TO TO FEEL MOST COMFORTABLE IN THIS REGION.
IT'S A SELF, IT'S AN ESTIMATE.
WE DON'T KNOW WHAT FIELD THE SCHOOLS ARE SUBMITTING.
BUT WE REALLY WILL BE COMPETITIVE THERE.
SAME WITH SOME OF THE OTHER CATEGORIES HAVE NOT BEEN DEFINED YET.
BUT IT IS OUR BELIEF THAT THE STATE WILL WANT TO INVEST IN L.A.
COUNTY. BUT IT'S ALSO OUR BELIEF THAT THE STATE MOVES TO THIS SORT OF REGION OF HIGH NEED.
SO WE THINK THOSE POINTS SHOULD SHOULD BE BENEFICIAL TO THE COLLEGE.
ALTHOUGH I THINK ANY OF THEM ARE IN YOUR REGION.
SO. SO ALL IN ALL, THINK YOU CAN HAVE A VERY, VERY COMPELLING APPLICATION.
MAYBE APPLYING TO APPLY FOR THIS ROUND OF THE NEXT.
AND THAT'S IT. SO I'D BE HAPPY TO TAKE ANY QUESTIONS, AS YOU SEE, BASED ON THIS ESTIMATE.
SO ALL OF US WOULD LIKELY BE IN THE SAME BOAT, BUT OBVIOUSLY MISSING OUT ON THE TEN POINTS ON THAT.
AND SO BUT I THINK 81 IS STILL A VERY STRONG APPLICATION PROCESS AND BUT WOULD HAPPY TO TAKE ANY QUESTIONS OR COMMENTS OR SUGGESTIONS.
HAVE A COUPLE QUICK QUESTIONS.
THANK YOU, ANGEL AND FELIPE, FOR PUTTING VICE PRESIDENT LOPEZ.
I MEAN, FOR PUTTING THIS TOGETHER.
A LOT OF WORK LEADING UP TO THIS.
THE QUESTIONS I HAVE ARE AROUND ECONOMICS AND RESTRICTIONS.
SO FIRST, WHAT ARE THE RESTRICTIONS RELATED TO RENTAL RATE INCREASES OVER THE LIFE OF THE PROJECT? SURE. TRUSTEE BIRKEY.
ALL RIGHT. I'M JUST PLAYING TABLE TENNIS UNDER HERE.
SORRY. LET ME GO BACK TO THE SLIDE WHERE IT TALKS ABOUT THE RENTS.
IT DOES. THERE IS A PROVISION IN THERE, SO.
AND HELP, PLEASE CORRECT ME WRONG.
I BELIEVE WE ARE SUBJECT TO INCREASING BASED ON THE CPI INDEX.
AND SO RIGHT NOW, IF WE WERE TO SUBMIT THIS PROPOSAL AS IS, WE WOULD BE PROPOSING A MONTHLY RENT OF $717 PER BED, PER BED THAT IS INCREASE ANNUALLY BASED ON THE CPI INDEX.
SO IS THE CPI COLLAR RELATIVE TO ANY INDIVIDUAL YEAR OR IS IT RELATIVE TO THE MAXIMUM STIPULATED BY THE STATE? I DON'T FULLY UNDERSTAND YOUR QUESTION.
COULD WE RAISE IT 10% AND STILL BE BELOW THE STATE MAX AT THAT POINT? OR ARE WE LIMITED FROM THE FROM THE STARTING LINE YEAR OVER YEAR BASED ON THE CPI? YEAH, PLEASE CORRECT ME IF I'M WRONG, BUT IT IS LIMITED TO THE CPI BASED ON OUR CURRENT RENT, NOT ON THE DIFFERENCE BETWEEN OUR 10% MARKET RATE AND WHERE WE ARE.
SO IF THE CPI IS 5%, WE ONLY INCREASE 5% BASED ON THE CURRENT RENT NOR REACH INTO THE TEN PLUS FIVE.
OKAY. AND THEN OUR OPERATING COSTS, WHAT ARE OUR OPERATING COSTS RELATIVE TO RENT ON YEAR ONE BASIS? IT'S A COMPLICATED QUESTION.
WE BELIEVE THE FACILITY SHOULD BE ABLE TO OPERATE FROM ROUGHLY 31 TO $200 PER BED PER YEAR.
[00:35:01]
SO WE'RE LOOKING AT RENTS OF $300 A MONTH TO COVER OPERATING COSTS.PROBABLY ADDITIONAL SECURITY COSTS, PROBABLY ADDITIONAL STUDENT SERVICES, PROBABLY ADDITIONAL HOURS OF CERTAIN AMENITIES ON CAMPUS.
AND ALL OF THOSE THINGS COST MONEY.
THOSE OTHER COSTS ARE THE ONES THAT WE WANT TO ASSURE WE ALSO CAN COVER.
WHICH IS WHY COLLECTIVELY, PHILIPPE AND MYSELF AND OTHERS BELIEVE THAT THAT 717 EVEN IF COSTS OF CHARGING LESS, GIVES YOU PLENTY OF FLEXIBILITY TO COVER ALL THOSE COSTS TOO, IN A WAY THAT YOU CAN BE PROVIDING THE BEST SERVICES FOR YOUR STUDENT RESIDENTS AND NOT BE A DRAG ON OTHER STUDENTS RESOURCE WISE.
SO IN THE EVENT THAT OPERATING COSTS WENT UP FASTER THAN CPI WOULD, WHAT LEVEL OF FLEXIBILITY WOULD WE HAVE IN THAT EVENT? ZERO. YOU HAVE A LOT.
YOU HAVE A LOT MORE THAN A LOT OF OTHER SCHOOLS.
SO, FOR EXAMPLE, SANTA ROSA JUNIOR COLLEGE, THEY WERE VERY, VERY SPECIFIC THAT WE HAVE TO HIT THE SPECIFIC GRANTS THAT WE PUT IN OUR APPLICATION FOR LAST YEAR WHEN WE APPLIED SOME OF THOSE SCHOOLS TO VERY, VERY AGGRESSIVE RENTAL RATES WITH THE BEST INTENTIONS OR THEIR GOING TO BARELY COVER OPERATING EXPENSES.
AND NOW TO YOUR POINT, WITH INFLATION, WE'RE STRUGGLING TO FIGURE OUT THE ECONOMICS OF HOW TO MAKE THE HOUSING A REALITY BECAUSE THEY WANT TO HAVE THEIR REVENUES TO COVER THE PROJECT. THAT'S WHY WE CHOSE THIS.
717. IT GIVES THE COLLEGE FACILITY TO LOWER RENTS OR BRING IT UP WITH SOME CERTAINTY.
I CANNOT IMAGINE THIS FACILITY WITHOUT THAT NOT EVER BEING ABLE TO NOT COVER ITS OPERATING EXPENSES WITH $700 PER BED.
AND THERE'S ONE OUTLIER THAT MAY HAVE GOTTEN $250 PER BED, BUT MOST OF THEM WERE THE ON A MONTHLY BASIS, AND MOST OF THEM WERE MOSTLY WERE USUALLY AT A MUCH LOWER LOWER NUMBER, $250 PER PERSON PER MONTH.
AND THAT INCLUDES UTILITIES IN THE RENT.
BUT YOU STILL CAN CHARGE ANYTHING MORE THAN THE CPI.
PIETRO'S POINT IS THAT THERE'S NO FLEXIBILITY TO RAISE THE RENT IF YOU NEED IT TO.
YEAH. SO IN OTHER WORDS, WE DON'T HAVE FLEXIBILITY, BUT HOPEFULLY WE HAVE RUNWAY.
CORRECT. HOW LONG DO HOW LONG DOES THE LIMITATION ON RENTAL RATE INCREASES BY CPI? LAST TEN YEARS.
I THINK THAT MIGHT BE HELPFUL TO KNOW.
TO THAT. I DON'T HAVE THAT OFF OFFHAND.
WHO WHO WOULD BE THE OPERATOR.
RIGHT. AS AT THIS POINT, CERRITOS COLLEGE.
SO WE WOULD HAVE TO HIRE UP AND TRAIN, RAISE OUR IDS.
YES. THIS PROJECT DOES ALREADY ASSUME THOSE IN BUILT INTO THE COST.
OKAY. HAVE WE LOOKED AT ANY KIND OF THIRD PARTY OPERATION? IS THAT WE'RE NOT ALLOWED TO.
THAT HASN'T BEEN BEEN LOOKED AT RIGHT AT THIS MOMENT.
DON'T WE HAVE THAT RIGHT NOW WITH THE VILLAGE? YEAH, WE HAVE. WE HAVE THAT WITH THE VILLAGE.
BUT WE WOULDN'T BE ALLOWED TO DO THAT HERE BECAUSE OF THIS.
YEAH, I THINK WE COULD OUTSOURCE THE OPERATION.
[00:40:03]
IF I MAKE IT THE WAY THAT SANTA ROSA AND IRISH CROSS HAVE DONE IS THEY HAVE HIRED OUTSIDE PROPERTY MANAGEMENT AND THAT PROPERTY MANAGERS PAID A FEE OFF TO COLLECT THEIR RENTS.HOWEVER, THEY HAVE ALSO HIRED A FULL TIME HOUSING ADMINISTRATOR.
THERE ARE REPORTS OF STUDENT SERVICES.
SO WE WOULD BE RESPONSIBLE FOR COLLECTIONS, EVICTIONS, ETC..
WELL, THE CERRITOS WERE AN OUTSOURCED PERSON OR OUTSOURCING ENTITY.
ARE THERE ANY RESTRICTIONS ON THIS PARTICULAR ALLOCATION ON HAVING EXTERNAL PROPERTY MANAGERS RUNNING THE FACILITY? ISN'T THERE A PROVISION OF MINIMIZING THE ABILITY FOR PRIVATE INDUSTRY TO PROFIT FROM THIS INVESTMENT? MAYBE I DID NOT READ THAT CORRECTLY.
I THINK THAT'S ON THE CAPITAL SIDE, ON THE P THREE SIDE.
I DIDN'T SEE THAT BEING AN ISSUE.
I THINK WE WENT INTO THIS POTENTIALLY OF LOOKING AT IT TO RUN IT INTERNALLY.
BUT AGAIN, I THINK THOSE ARE STILL ON THE TABLE TYPE OF CONVERSATIONS THAT WE CAN HAVE CONTINUE TO HAVE DURING THIS PROCESS TO SEE WHETHER OR NOT DO WE TRULY WANT TO KEEP IT IN-HOUSE OR DO WE DO WE PREFER IT TO OUTSOURCE THAT, THAT THAT ELEMENT? I GUESS I MISUNDERSTOOD THEN.
SO THAT'S GOOD. THANK YOU FOR CLARIFYING, ANGEL.
TO WHAT EXTENT WOULD THAT CHANGE OR NOT CHANGE THE OPERATING COST PROJECTIONS? SO YOU SHOULD SEE A TYPICAL PROPERTY MANAGEMENT FEE FOR STUDENT HOUSING COMMUNITIES OF 4% OF COLLECTED REVENUE. WHEN A PROPERTY HAS DISCOUNTED RENTS LIKE THIS.
BUT AS I SAID, YOUR YOUR INCOME SHOULD EXCEED YOUR OPERATING EXPENSES PROBABLY TO X AND BRING IN AN ASSET MANAGER SHOULD BE SOME ECONOMIES OF SCALE, PARTICULARLY IN THINGS LIKE MANAGING THE RENTAL, ESTABLISHING POLICIES, TRAINING AREAS, ALL OF THE ACCOUNTING BEHIND THE PROPERTY, MANAGING TO WORK ORDERS FOR MAINTENANCE.
THOSE ARE EXACTLY THE KIND OF THINGS THAT COULD HELP.
SITE MANAGER SHOULD BE ABLE TO BRING FROM A FROM A NATIONAL CAPITAL THAT WOULD IN TURN THEN REDUCE ADMINISTRATIVE COSTS IN THE FACILITY SHOULD COMPENSATE FOR MORE THAN THE COST OF HIRING MANAGER.
SO MY EXPECTATION WOULD BE THAT.
ANNOUNCER MANAGERS SHOULD BE ABLE TO OFFER THE FACILITY AT A LOWER COST THAN THE COLLEGE, ESPECIALLY INITIALLY BECAUSE YOU HAVE THE INITIAL INVESTMENT TO ESTABLISH ALL THOSE PROCESSES AND SYSTEMS THAT ARE AN ASSET MANAGER SHOULD BE ABLE TO JUST INFLUENCE WHAT LEVEL OF CAPITAL RESERVE IS ASSUMED IN OUR IN OUR PROFORMA.
THE CHANCE OF THIS OFFICE HAS EXPRESSED IN WRITING TO US THAT IT IS THEIR WISH MANDATES TO WISH THAT THE COLLEGES THAT ARE AWARDED THE GRANT WOULD USE IN CASH FLOW FROM THE PROPERTY TO THEN SUPPORT THE THE THE LONGEVITY OF THE FACILITY BY USING THAT THAT CASH FLOW TO MAINTAIN AND AVOID HAVING DEFERRED MAINTENANCE OF THE BUILDING.
AND AS I MENTIONED BEFORE TONIGHT, THE CASH FLOW CAN BE CAN BE PRETTY GOOD.
COUNTY FOR A FACILITY WITH PRIVATE BATHROOMS IN THE UNIT.
SO YOU'RE NOT MAINTAINING YOUR BATHROOMS. THE INITIAL COST ESTIMATE LOST OVER $1,000,000 A YEAR, WHICH, YOU KNOW, DIVIDED BY 396 BEDS.
[00:45:11]
YOU'RE LOOKING AT THE MAP, LOOKING AT 20 $500 PER DAY, WHICH IS EXACTLY WHY I THINK CERTAINLY THIS WILL PROBABLY HELP TO LOWER RENTS MORE BECAUSE YOU GOING TO HAVE A NEED TO SET THE RENTS AT THE MAXIMUM.WHAT WOULD ACTUALLY BE OPERATING THE PROPERTY? RIGHT, BUT OUR CAPITAL NEED WILL INCREASE OVER TIME, EVEN THOUGH WE DON'T HAVE OUR CAPITAL RESERVE FUND.
BECAUSE IF WE'RE GOING TO BE LIMITED ON A YEAR OVER YEAR BASIS TO NOT INCREASE MORE THAN CPI, WE'RE NOT GOING TO BE ABLE TO CATCH UP WITH ANY DEFICIENCY IN CAPITAL RESERVE THAT WE START BEHIND IN.
SO. SO I BELIEVE YOU'RE ALLOWED TO INCREASE CPI BEYOND THE 717.
SO YOU'RE GOING TO PROBABLY DECIDE TO CHARGE $600 A MONTH INSTEAD OF 17 DUE TO INCREASED MORE THAN 3% BECAUSE OF AN INCREASE OF THE 717 OUT OF THE 600.
TO YOUR POINT, THE STOOL CAN ANSWER YOUR QUESTION, WHICH IS WHAT WILL THE RESERVE BE? SO THE INITIAL RESERVE WE HAVE IN OUR BUDGET WAS ABOUT $84,000 A YEAR OR $200 PER YEAR ON TWO OR £396.
SO SO I THINK AS PART OF THE FINANCIAL PLANNING OF THE PROPERTY, WE SHOULD ABSOLUTELY TAKE INTO ACCOUNT THE OPPORTUNITY TO BUILD A BIGGER RESERVE EARLY ON TO MAKE SURE WE DON'T EVER LEAVE THE COLLEGE WITH THE POTENTIAL LIABILITY THAT WE WOULD HAVE TO SUPPORT A PROJECT.
YEAH, BECAUSE I THINK IF WE'RE REALLY RESTRICTED IN TERMS OF OUR RENTAL RATE INCREASES AND FLEXIBILITY, THEN WE NEED TO BE ABLE TO ATTACK OUR CAPITAL RESERVE ESTIMATES WITH THE LONGEVITY OF THAT RESTRICTION.
SO IF IT'S TEN YEARS, FOR EXAMPLE, IT'S NOT A VERY BIG DEAL.
YEAH. THOSE ARE THOSE ARE MOST OF MY CONCERNS.
ANY OTHER QUESTIONS? SORRY. TRUSTEE PEREZ.
YES. I JUST HAVE ONE QUESTION IN REGARDS TO THE 717 FOR THE MONTHLY RENT, DO YOU DESCRIBE THAT IN THE APPLICATION? BECAUSE IN MY MIND THAT SEEMS A LITTLE HIGH AND BUT YOU'RE TALKING LIKE I THINK YOU MENTIONED UTILITIES ARE INCLUDED.
OTHER THINGS, AGAIN, JUST TO TRY TO MAKE THE APPLICATION MORE ATTRACTIVE.
I JUST DON'T KNOW HOW YOU PRESENT THAT INFORMATION.
YEAH. SO IT IS SPELLED OUT IT IS SPECIFIED IN THERE IN WRITING THAT THE 717 IS IS THE RENT ON THAT.
AND THEN WE WOULD THEN BE HELD TO THAT, THAT WE COULD NOT INCREASE THAT FROM THAT.
BUT BASED ON WHAT ANGEL SAID, THE THE RENT THAT WE'RE PUTTING IN THE APPLICATION IS SET TO MAXIMIZE THE POINT. SO EVEN IF WE LOWERED IT, WE'RE NOT GETTING ANY ANY ADDITIONAL POINT VALUE WE HAVE, WE HAVE ATTAINED THE MAXIMUM POINTS BASED BASED ON THIS SCENARIO ON THAT.
SO WE'VE ALREADY WENT THROUGH THAT AND MADE SURE THAT BASED ON ON IT, THAT WE'RE BOTH ACHIEVING MAXIMUM POINTS AND THEN PUTTING US IN A POSITION WHERE WE'RE ABLE TO CASH FLOW THE PROJECT LONG TERM IF WE CHOOSE TO KEEP MAINTAIN AT THE 717.
OKAY. I GUESS MY POINT IS FROM A STUDENT PERSPECTIVE.
FROM A STUDENT PERSPECTIVE, RIGHT? WE WANT WE WANT THIS TO BE ALSO ATTRACTIVE TO A STUDENT.
SO IF THERE'S OTHER THINGS THAT ARE GOING TO BE INCLUDED, IF THEY'RE GOING TO AND I DON'T ASSUME THEY'RE GETTING A PARKING SPOT, I MEAN, AGAIN, LIKE, WHAT ARE THE OTHER ASPECTS? BECAUSE I REMEMBER DATING MYSELF LIKE 25 YEARS AGO, I PAID LIKE 560 A MONTH AT USC.
THAT WAS MY MY RENTAL FEE FOR A GRADUATE STUDENT APARTMENT.
RIGHT. BECAUSE I INCLUDED UTILITIES, MY CABLE, MY WATER, MY PARKING SPOT, SECURED ENTRANCE.
AGAIN, I MEAN, IT WAS IT WAS A GOOD DEAL FOR THAT AMOUNT.
[00:50:01]
I JUST WANTED TO MAKE SURE THAT WE ARE PORTRAYING THIS FOR A GOOD DEAL FOR OUR STUDENTS.BUT THAT WOULD ALSO INCLUDE ACCESS TO LAUNDRY, THE FACILITIES.
THEY WOULD HAVE ACCESS TO THE KITCHEN IN THERE.
SO THEY WOULD IT WOULD BE FULL.
THIS WOULD BE THE TOTAL COST OF OF THEM ON THAT YOU KNOW GET A FULLY FURNISHED.
YEAH I GUESS THE ONLY QUESTION THAT WOULD RELY AND WE CAN HAVE A FURTHER CONVERSATION IS WHETHER OR NOT IT INCLUDES PARKING OR NOT, YOU KNOW AND SO YOU KNOW SO YOU KNOW WE CAN DISCUSS THAT WHETHER OR NOT THAT ALSO INCLUDES PARKING ON THAT.
BUT I DON'T THINK WE BUILT IN NECESSARILY PARKING.
I DON'T THINK WE HAD THAT DISCUSSION ON IT.
BUT WE CAN CONSIDER THAT DOWN THE ROAD.
THAT DOESN'T NECESSARILY NEED TO BE EMBEDDED IN THERE.
IF WE INCLUDED THAT, THAT WOULD OBVIOUSLY WOULD, YOU KNOW, PROVIDE MORE OF A BENEFIT TO STUDENT BECAUSE THIS WOULD BE THE TOTAL COST AND THEY WOULD HAVE FULL HOUSING OF FULLY FURNISHED UNIT, ALL THE UTILITIES, YOU KNOW, AND SO ON.
THAT'S A REMINDER WE'RE NOT COMMITTING.
YOU'RE NOT COMMITTING CERRITOS COLLEGE TO CHARGING SOMEBODY $17.
YOU ARE STATING THAT YOU WILL NOT CHARGE MORE THAN THEY ARE COMMITTING UP.
I WANT TO BE ABLE TO HAVE LOW RENT, BUT I ALSO DON'T WANT TO HAVE THE PROJECT SO FUNDED SO LOW THAT OUR PROJECT TURNS INTO THE PROJECTS AT SOME POINT, RIGHT, BECAUSE WE JUST AREN'T KEEPING IT UP.
IF RATE WAS, YOU KNOW, HERE, HOW DOES THAT LOOK LONG TERM ON A CASH FLOW PERSPECTIVE GIVEN WITH THIS AMOUNT OF RESERVES AND STUFF LIKE THAT? SO RIGHT NOW THE APPLICATION HERE IS OBVIOUSLY ASSUMING 717 TO GET MAXIMUM POINTS AND THEN MAKE SURE THAT CERRITOS IS COVERED LONG TERM.
BUT AGAIN, THAT'S AT OUR DISCRETION, ASSUMING WE ARE SUCCESSFUL ON THE GRANT.
AND THE OTHER THING TO REMEMBER IS THE WE'RE TALKING ABOUT 20, 25, 2026, AND AT THE RATE OF INFLATION TODAY, THINGS ARE CHANGING PRETTY RAPIDLY.
THE WORST CASE SCENARIO FOR US WOULD BE FOR A PROJECT NOT TO MAKE CASH FLOW AND FOR US TO HAVE TO EITHER FUND THE PROJECT THAT I CLIP FROM THE GENERAL FUND OR ABANDON, ABANDON THE PROJECT FOR WHATEVER REASON.
SO WE NEED TO WE NEED TO REMEMBER THAT WE'RE TALKING ABOUT MONEY TODAY, BUT THE VALUE OF THAT MONEY IN TWO OR THREE YEARS AT OUR CURRENT INFLATION RATE IS GOING TO BE DRASTICALLY DIFFERENT.
THE WE WILL BE EXPERIENCING A DEPRECIATION COST ON THE SET OF COST OF RENT.
I'M NOT SAYING THAT IT CANNOT BE LOWER.
WHAT I'M TRYING TO SAY IS WE NEED TO REMEMBER THAT THIS IS NOT TODAY'S DOLLARS, BUT FUTURE DOLLARS.
YOU CAN EAT UP 10% OVER TWO YEARS PRETTY EASILY.
SO THAT SO IF I UNDERSTAND RIGHT, 717 IS YEAR OF OPENING, RIGHT? SO 717 IS WHAT, 2026.
YES. DOLLARS IS BASED ON THE 2022 YEAR MEDIAN INCOME DOLLARS.
SO SO YOU COULD POTENTIALLY LET'S SAY WE HAD THE NUMBER OF 10% ANNUAL BMI INCREASES THE NEXT FOUR YEARS, EXTREMELY UNLIKELY.
BUT LET'S ASSUME THAT FOR A SECOND THING, IN THEORY, THE 717 WILL INCREASE BY 10% PER YEAR.
AGAIN, THAT WILL BE YOUR CEILING, YOUR MATH.
THIS IS BY NO MEANS THE RENTAL.
SO I'M HEARING I'M HEARING A COUPLE OF DIFFERENT THINGS HERE.
[00:55:01]
AND I WANT TO MAKE SURE WE FIGURE THIS OUT JUST SO I CAN LAND THE PLANE IN MY MY CLOUDY MIND.WE'VE GOT OUR 717 IS TACKED TO IS IT A CPI COLLAR OR AN ARMY COLLAR? YEAH. MICHAEL, IS THAT ACCURATE? BECAUSE YEAH, BASED ON THE YES, I'M HEARING FROM STAFF THAT'S CPI.
WHAT YOU COULD INCREASE OUT OF THE 717 SO THE INCREASE.
SO WE'RE SETTING THE RENTS BY RMI, BUT WE'RE NOT INCREASING THE RENTS.
WELL, THE RENTS ARE CERTAINLY SET BASED ON THE DEMAND THAT THE.
UH HUH. OKAY. THE WAY THE RENTS INCREASE OR CAN BE INCREASED.
THE CHANCELLOR'S OFFICE GAVE ITSELF SOME FLEXIBILITY.
AND HOW DO WE DO THAT? AND CPI WAS IN THE IN THE SENTENCE OF THE OPTIONS, BUT IT'S NOT A HARD AND FAST RULE OF HOW IT'S LIKELY TO ALLOW INCREASES.
THEY GAVE THEMSELVES SOME POSSIBILITY.
SO ARE WE SAYING WE SELECTED CPI FOR THE CRISIS IN THIS ELECTION? NO. NOR DO WE HAVE THE OPPORTUNITY TO MAKE A SUCH.
THE STATE SAID THE RATE OF STATE LAW BASED ON AREA MEDIAN INCOME.
30%. SO TAKE HALF THE MEDIAN INCOME AND MULTIPLY BY 20%.
AND THAT'S THE MAXIMUM THEY CHARGE ANNUALLY.
SO WE TOOK THAT NUMBER DIVIDED BY 12 MONTHLY.
AND THAT'S WHY WE GOT THE $797.
THE $787 BECOMES THE MAXIMUM WE'RE ALLOWED TO CHARGE FOR FUNDING FOR THIS PROJECT.
SO THIS PROGRAM NOW, IN ORDER TO MAXIMIZE THE SCORING, YOU GET A .1.
SO OF COURSE, WE WENT 10% LOWER BECAUSE IN MAXIMUM TEN POINTS.
SO WE COULD DO THE OTHER TEN POINTS IF WE WENT 10% BELOW THE $787.
AND AS WE GOT TO 717 AND WE'VE ASKED TWICE TO MAKE SURE, IS THERE ANY POINT GOING TO ON NOTICE AND THERE'S NO MORE POSSIBLE LOWER GOING TO GIVE YOU AN IDEA THE LEAST EXPENSIVE BED.
AVERAGE COST, COLLEGE, CONDO OR PARTNERSHIP FROM THE COMMUNITY.
SO SO YOU'RE RUNNING 30% LESS EXPENSIVE IN THAT PROPERTY IS TO COMPARE AGAINST OTHER NEW HOUSING PROPERTY. THE ABSOLUTE FIRST RATE IS PERCENT.
WAS THAT EXPLANATION CLEAR? YES, I UNDERSTAND.
THANK YOU, UNCLE. MY NEXT QUESTION THEN IS, IS IT TRUE THAT OUR REQUIREMENT LET'S ASSUME OPENING IS IN 2026, OUR YEAR ONE RENTAL RATE IS BASED IN 2026 IS BASED ON A 2022 AMI CALCULATION.
IT'LL BE BASED ON WHATEVER ESCALATION FORMULA THEY USE BETWEEN NOW AND THEN.
SO. SO YOUR MAXIMUM GRANT IN 2026 WILL BE $771.2 ADJUSTED TO THE 26.
SO WHATEVER THAT ADJUSTMENT MECHANISM IS, IT'LL INCREASE BY THAT MUCH.
SAME WITH THE CONSTRUCTION BUDGET.
IT'LL BE INCREASED BASED ON INFLATION AND THE BUILDING IS BUILT.
OKAY. SO IF IT'S 717 AND WE EVERYTHING INFLATES BY 10%, BY THEN OUR OBLIGATION MOVES FROM 717 TO WHATEVER IT IS, 7.98 OR 7.99. RIGHT YOUR SECOND.
THANKS. WHAT RESTRICTIONS ARE WE LOOKING AT FOR THESE STUDENTS IN TERMS OF AGE? HOW MANY CREDITS THEY'RE TAKING? YOU KNOW, AND THAT KIND OF LIKE WHAT DEMOGRAPHIC ARE WE EXPECTING AND ARE WE GOING TO BE HAVING DIFFERENT FLOORS OF DIFFERENT GENDERS OR SOMETHING LIKE THAT, AS HAS BEEN THE CASE IN MANY DORMS?
[01:00:03]
WHAT'S THE THE PROJECT? LET'S JUST ASSUME THAT IT'S BUILT.WHAT IS THE STUDENT LIFE LOOK LIKE IN THIS DOOR AND HOW IS THERE ANY RESTRICTIONS ON THE WHO CAN GO INTO INTO THE BUILDING? I CAN'T I DON'T RECALL EXACTLY ON THAT.
YES, SIR. THAT'S AN AFFORDABILITY PART.
AND THEN THERE IS AN ENROLLMENT ON THE ENROLLMENT PART.
THE STUDENT MUST BE TAKING A MINIMUM AVERAGE OF 12 DEGREE APPLICABLE UNITS PER SEMESTER OR QUARTERLY EQUIVALENTS TO FACILITATE FACILITATE A PLAN OF COMPLETION.
THE REQUIREMENT TO REDUCE A UNIT LOAD SUCH AS ILLNESS OR INJURY.
SO FULL TIME STUDENTS IS THE FIRST REQUIREMENT.
SECOND ONE IS ONE OF AFFORDABILITY AND THE DIVESTMENT TARGETED AT LOW INCOME STUDENTS.
AND THE WAY THE STATE HAS DEFINED IT IS GENERALLY STUDENTS WHO ARE ELIGIBLE TO RECEIVE PELL GRANT OR PELL GRANT FINANCIAL AID. THERE WOULD BE AN EXEMPTION FROM PAYMENT OR RESTITUTION PROVIDED FOR THE STUDENT'S MEETS INCOME CRITERIA FOR THE CALIFORNIA DREAM ACT.
SO FAMILY GROSS FAMILY INCOME, $86,000 OR LESS, OR STUDENTS WHO ARE ELIGIBLE FOR A FEE WAIVER FROM THE DISTRICT.
SO SO THOSE ARE KIND OF THE KEY GROUPS THAT THE LAW IS TARGETING.
I THINK THERE WAS ANOTHER PART OF HIS QUESTION THAT WAS UNANSWERED.
YET I GUESS YOU WANTED IT AGE.
THE AGE? YEAH, THE AGE RESTRICTION.
AND WHERE YOU'RE GOING TO HAVE AN ANY SEPARATION OF SEPARATION OF GENDERS.
SO THE STATE DID NOT MANDATE AGE RESTRICTION.
AT THIS POINT, WE HAVE NOT DISCUSSED ONE PART OF THIS PROJECT.
THERE'S A LOT OF TIME BETWEEN NOW ON OPEN FOR COLLEGE TO SET POLICIES ON THAT.
THE SAME APPLIES TO GENDER POLICIES.
I CAN TELL YOU THERE'S NO HARD AND FAST RULE THAT I'M SEEING STATEWIDE.
WHEN WE SURVEYED STUDENTS AND ADMINISTRATORS, BUT ALSO DECIDED TO OFFER SOME PARTS OF THE BUILDING THAT WOULD BE SEGREGATED BY GENDER AND SOME WILL BE MORE GENDER INCLUSIVE.
OUR STUDENTS WILL PREFER ONE OR THE OTHER AND FIND A DIFFERENT FLOOR.
SO MORE FROM THE OLD LADIES OR MEN.
SIMILAR FOR OUR INCLUSIVE OUTREACH COURSE COLLEGE.
THEY HAVE A VERY TOOK A VERY LAISSEZ FAIRE APPROACH.
PRETTY MUCH YOU HAVE TO SHOW ROOMMATES.
WE HAVE ROOMMATES. I DON'T BELIEVE ROOMMATES OF DIFFERENT GENDERS WERE ASSIGNED TOGETHER AT NIGHT.
WE WERE ALMOST DONE IN BY FLOOR OR REGION.
AND I THINK IN RETROSPECT, IF THEY WERE DOING A FREE TAKE OUT FROM SCRATCH, THEY MIGHT THEY MIGHT HAVE TRIED TO LEASE OUT CERTAIN COMMUNITIES FOR CERTAIN SPACES THAT ALLOWED GROUPS TO PREFER THAT SEPARATION, TO HAVE THAT OPPORTUNITY WITHIN THE OVERALL COMMUNITY WITHOUT FORCING ANYBODY TO HAVE IT OR NOT.
ON THIS POINT, THOSE SOMETHING NOT BEING DECIDED FOR THIS PERIOD.
WE'RE VERY EARLY IN THIS PROCESS, BUT YOU WOULD HAVE THREE OR FOUR YEARS TO FIGURE THAT OUT.
YEAH, I MEAN, THAT'S SOMETHING THAT WE SHOULD CERTAINLY FIGURE OUT SOONER RATHER THAN LATER, BECAUSE THE MORE RESTRICTIONS THAT WE HAVE, THE FEWER AUDIENCES THAT WE CAN MARKET TO AND THE FEWER INEVITABLY ROOMS WE WILL END UP FILLING, BECAUSE THERE HAS IF WE DO THE LAISSEZ FAIRE APPROACH THAT I GUESS OAK DID OR COAST COMMUNITY COLLEGE COAST DID, THEN, YOU KNOW, AS ANGEL SAID, WE SHOULD, WE WOULD WANT TO GO BACK AND LEARN FROM THAT MISTAKE.
[01:05:02]
OUR OLDEST THAT MAY BE, YOU KNOW, IN WELL PAST, YOU KNOW, 30 OR 40 OR SO.AND, YOU KNOW, I THINK THAT WE NEED TO HAVE A PRETTY CLEAR IDEA OF WHAT STUDENT LIFE IS GOING TO LOOK LIKE DOWN THE ROAD RATHER THAN RUSHING TO GET AN APPLICATION IN, BECAUSE THERE ARE GOING TO BE MULTIPLE ROUNDS AT THIS POINT FOR THE FORESEEABLE FUTURE. AND WE NEED TO HAVE A PRETTY CLEAR IDEA OF WHAT OUR OPERATIONAL COSTS ARE GOING TO LOOK LIKE, ESPECIALLY IF IT'S GOING TO HOVER AROUND MORE OF AROUND THE 70 TO 80%, YOU KNOW, CAPACITY, BECAUSE SOME OF OUR STUDENTS ALSO HAVE FAMILIES TO TAKE CARE OF.
SO WE NEED TO MAKE SURE THAT, YOU KNOW, THERE'S SOME KIND OF, I GUESS, SEPARATION.
AGAIN, WE HAVE TO TALK ABOUT SEPARATIONS AND RESTRICTIONS.
IF WE HAVE STUDENTS THAT HAVE FAMILIES TO TAKE CARE OF, THEY CAN'T EXACTLY JUST MOVE INTO A DORM.
RIGHT. THEY HAVE THEIR DEPENDENTS.
SO I THINK THERE'S A LOT OF LONGER TERM AND STUDENT LIFE ISSUES THAT NEED TO BE ANSWERED BEFORE I'M LIKE 100% COMFORTABLE WITH HAVING A A DORM ON A COMMUNITY COLLEGE CAMPUS IN OUR CAMPUS HERE.
I THINK IT'S A GOOD IDEA IN THEORY, AS ARE A LOT OF THINGS THAT COME FROM THE STATE OF CALIFORNIA.
BUT, YOU KNOW, THERE ARE THINGS THAT NEED TO BE EXPLORED AND ANSWERED BEFORE I THINK THAT IT WOULD BE SOMETHING THAT WOULD PUT MY STAMP OF APPROVAL ON AT THIS POINT. SO. THOSE ARE MY THOUGHTS.
I WOULD WARN YOU THAT THE STATE GRANT PROGRAM IS NOT REALLY CONDUCIVE TO FAMILY HOUSING, SINCE THE COST PER BED IS SUCH A MAJOR ASPECT OF THE FORMULA.
AND I'M NOT SAYING THAT WE SHOULD EITHER.
AND I'M NOT SAYING WE DIDN'T DESIGN IT.
NO. TO ACCOMMODATE A SPECIFIC AMOUNT.
HOW DO WE AFFORD DARNOLD TO LOUISVILLE? YEAH, I GUESS MY ONE OF MY MAIN CONCERNS, OTHER THAN WHAT I HAVE TO STATE, IS HOW MUCH DEMAND IS THERE FOR THIS AMONGST OUR STUDENTS.
WAS THAT EXPLORED IN OUR 20 1718 SURVEY, AND WHAT WERE THE RESULTS OF THAT? DID THEY WANT TO LIVE ON CAMPUS? I MEAN, YOU DON'T HAVE TO ANSWER IT NOW, BUT AT LEAST BY JANUARY 25TH, WE SHOULD HAVE A PRETTY CLEAR IDEA OF HOW MUCH DEMAND THERE IS FROM STUDENTS TO WANT TO LIVE ON CAMPUS AND WHAT KIND OF STUDENT LIFE SHOULD WE BE EXPECTING.
I DON'T WANT TO SEE I ALSO DON'T WANT TO SEE SEGREGATION, YOU KNOW, EITHER OF EITHER GENDER OR OF RACE, AS WAS TALKED ABOUT IN THE INTERNATIONAL DORMS AT COASTLINE COMMUNITY COLLEGE.
I THINK THERE'S REALLY A LOT OF PRETTY TOUGH AND CONTROVERSIAL QUESTIONS THAT WE NEED TO ANSWER BEFORE WE, YOU KNOW, MAY EVEN MOVE FORWARD ON ROUND TWO, EVEN THOUGH THIS MAY BE ONE OF THE BETTER TIMES. SPEAKING OF.
SO TO JUST TO THAT'S ALL I HAVE TO SAY.
I APPRECIATE THAT. TRUSTEE LEWIS AND I WILL SAY THAT A LOT OF A LOT OF THIS IS WELL-WORN TERRITORY BECAUSE THERE HAVE BEEN HUNDREDS OF THOUSANDS OF STUDENT BEDS BUILT AND OCCUPIED IN THE LAST TEN YEARS.
AND A NUMBER OF COMMUNITY COLLEGES HAVE ALREADY DONE IT AS A COMMUNITY COLLEGE LEVEL.
BUT IN ON A FOUR YEAR AND EVEN ON A TWO YEAR SMALLER COLLEGE LEVEL, IT'S SOMETHING THAT IS DEFINITELY THERE'S AS MANY CONCEPTS AND APPLICATIONS AS AS COLLEGES.
AND THEY'RE NOT WE WOULDN'T BE CREATING ANYTHING OUT OF WHOLE CLOTH.
WHAT I WOULD SAY IS IF WE WERE UNDER OCCUPIED, WE'RE IN A STRANGE SITUATION BECAUSE ASIDE FROM ANY MONEY WE PUT IN CAPITAL WISE OUT OF THE POT, WE HAVE NO DEBT ON THE PROJECT, SO WE WOULDN'T BE SUCKING WIND THE WAY LIKE A LOT OF OTHER STUDENT HOUSING OR ANY HOUSING IN THE PRIVATE MARKET WOULD IF YOU'RE UNDER OCCUPIED.
SO THE MATH, YOU KNOW, WE DON'T HAVE TO PAY FOR WATER FOR STUDENTS THAT AREN'T THEY'RE NOT FLUSHING TOILETS OR AREN'T THERE TURNING ON LIGHTS. RIGHT. SO THERE ARE THERE'S KIND OF A FAIR TRADE OFF.
AND WE'RE ALSO NOT PAYING FOR THE LAND DIRECTLY.
I THINK WHAT KEEPS ME UP AT NIGHT IS REALLY AROUND TO TWO THINGS.
ONE, THIS LONG TERM RESTRICTION THAT IS STILL A LITTLE UNDEFINED.
[01:10:03]
WE DON'T KNOW HOW LONG IT IS FOR AND IT'S A LITTLE BIT UNCLEAR WHAT THE ACTUAL RESTRICTION IS.THERE'S GOING TO BE A RESTRICTION ABOUT RENTAL RATE INCREASES, BUT WE DON'T KNOW WHETHER IT'S CPI OR WHETHER IT'S TAG TO AREA MEDIAN INCOME INCREASES OR SOME OTHER MEASURE. THE OTHER PIECE IS REALLY AROUND STUDENT LIFE AS A WHOLE.
LIKE DO WE DO WE HAVE A ROBUST DINING PROGRAM? DO WE HAVE A PHASE TWO OPTION THAT'S GOING TO COME ONLINE? HOW DO WE DEAL WITH EQUITY FOR STUDENTS? I ANTICIPATE THAT IN ALL LIKELIHOOD AT THESE RENTAL RATES, THE DEMAND IS GOING TO BE A LOT MORE THAN 388 BEDS.
SO WE'RE GOING TO HAVE TO FIGURE OUT AN EQUITABLE PROCESS.
BUT BUT I THINK THAT'S THAT'S REALLY THE AREA WHERE I THINK THAT I THINK IT'S STILL A LITTLE UNRESOLVED IN MY MIND, NOT THAT I DON'T WANT THIS TO MOVE FORWARD. THEN THE OTHER LAST QUESTION IS, IF WE WERE TO SAY, APPROVE THE APPLICATION, DO WE HAVE OTHER OPPORTUNITIES TO GET OFF THE TRAIN? AND THIS IS NOT A PUBLIC RECORD FOR THE STATE IF YOU'RE LISTENING, BUT IF THEY IF WE WERE TO BE GRANTED FUNDING AND THEN AND THEN NEED FOR ANY REASON TO PULL OUT, IS THERE ANY FLEXIBILITY YOU CAN ALWAYS REFUSE THE ALLOCATION AND ALL THOSE ARE VALID POINTS, RIGHT? SO WE CAN RIGHT NOW WE ARE NOT BUILDING ANYTHING.
WE ARE JUST SIMPLY PUTTING TOGETHER AN APPLICATION PACKAGE.
THEY WILL GET US TO COMPETE TO POTENTIALLY GET FUNDING.
YES. SO WE WERE EXPECTING A COMPETITION OF 700 MILLION.
WE ARE GOING TO GET 500 OF WHICH ONLY 250 ARE ALLOCATED FOR THE COMMUNITY COLLEGES, DEPENDING ON HOW MANY APPLICANTS THE STATE GETS.
EVEN IF OUR APPLICATION PACKAGE IS SUPERB, MAY NOT GUARANTEE THAT WE GET IT BASED ON THE NUMBER OF PROJECTS THAT WE RECEIVE FROM ACROSS THE STATE, BECAUSE IT'S VERY LIKELY THAT THE CHANCELLOR'S OFFICE WILL WANT TO DISTRIBUTE THEIR DOLLARS ACROSS ALL REGIONS.
SO WHAT WE FEEL THAT WE COULD BE COMPETITIVE IN L.A.
COUNTY, WE MAY NOT BE THE MOST COMPETITIVE.
WE ARE PLANNING TO BE, YES, BUT IT IS JUST THE PROCESS.
I MEAN, I'M SORRY, THE DECISION IN WHICH POINT WE CAN CONTINUE TO HAVE SOME OF THESE CONVERSATIONS BECAUSE, YES, SETTING UP THE RULES, THE PROCEDURES AND FINDING HOW WE'RE GOING TO DO THIS IS GOING TO REQUIRE SEVERAL CONVERSATIONS AND LENGTHY THAT WE CAN BEGIN ONCE WE HAVE SUBMITTED THE APPLICATION.
IN THE EVENT THAT WE GET APPROVED, WE WILL HAVE A COUPLE OF YEARS NOT ONLY TO GO THROUGH THE CONSTRUCTION PHASE, GOING FROM THE BOTTOM, SETTING UP THE GROUND, HIRING ARCHITECTS, DOING THE BIDDING.
SO WE'RE TALKING ABOUT THREE YEAR PERIOD AT LEAST THAT WE CAN HAVE ALL THE CONVERSATIONS THAT WE NEED TO HAVE REGARDING POLICY PROCEDURE AND SO ON. AND EVEN BEFORE WE BEGIN CONSTRUCTION, WE CAN ALWAYS TELL THE STATE WE WE'RE JUST NOT GOING TO DO IT AND KEEP YOUR MONEY, WHICH IS ALSO OBVIOUSLY A POSSIBILITY.
BUT IF WE DON'T DO IT ON THIS ROUND, IT GETS HARDER AND TOO THE RESOURCES GET SCARCE BECAUSE IT IS UNLIKELY THAT IF THE ECONOMY CONTINUES TO BEHAVE THE WAY IT IS, THAT WE'RE GOING TO EXPERIENCE ANOTHER LARGE ALLOCATION OF DOLLARS FOR HOUSING. SO THERE IS TIME TO HAVE THOSE CONVERSATIONS WE HAVE.
WELL, I WILL CONCEDE THAT CLOSEST TO AN EXPERT IS POSSIBLE ON A STUDENT HOUSING ON CAMPUS.
AS I CAN DEFINE. LIZ HAS DONE A LOT OF WORK ON A STUDENT HOUSING STUDENT LIFE AND SO ON.
AND YES, THE QUESTION ABOUT CHANGING A STUDENT LIFE, IT NEEDS TO HAPPEN, BUT IT NEEDS TO HAPPEN OVER A PERIOD OF TIME BECAUSE THOSE OF YOU THAT HAVE BEEN INVOLVED IN HOUSING KNOW THAT THE STUDENT LIFE THAT IS SPECIFICALLY TARGETED TO TO STUDENTS IN RESIDENCE HALLS IS AN EXTENSION OF WHAT YOU EXPERIENCE ON CAMPUS WITH SOME VERY SPECIFIC MODIFICATIONS THAT WE WILL HAVE TO WORK ON.
[01:15:03]
NOT ONLY THE POLICIES OF HOW YOU STRUCTURE THE LIVING QUARTERS IS A CONVERSATION WE NEED TO HAVE, BUT ALSO HOW PEOPLE BEHAVE, CURFEW HOURS, WHAT IS ALLOWED AND NO IN THE DORM ROOMS. AND I THINK THOSE ARE, IN MY OPINION AND EXPERIENCE A BIT MORE COMPLICATED THAN SOME OF THE LARGER REGULATIONS.IN MY EXPERIENCE, HAVING BEEN IN RESIDENTIAL CAMPUSES BEFORE, IT IS MORE COMPLICATED AND REQUIRE A LOT MORE TIME THAN THE OVERARCHING POLICY STRUCTURES.
BUT AGAIN, MY POINT BEING IS THAT WE HAVE AT LEAST THREE YEARS TO FIGURE ALL THOSE PIECES OUT AND AT LEAST THE REST OF THIS YEAR TO DETERMINE WHETHER OR NOT WE'RE GOING TO KEEP THE MONEY OR NOT IF WE GET IT RIGHT.
THERE ARE TWO QUESTIONS THAT I CAN ANSWER.
YOUR DEMAND STUDY ASSUMED THAT FOR MARKET RENTS, NOT FOR THESE DISCOUNT RATES, YOU HAD OVER 1500 STUDENTS WHO WHO WERE INTERESTED IN LIVING ON CAMPUS AND MARKET RENTS, WHICH WERE HIGHER THAN WHAT'S BEING CONSIDERED HERE.
SO. SO 386 BEDS, 1500 STUDENTS DEMAND THAT HIGHER RENTAL RATE.
I THINK YOU SHOULD BE CONFIDENT THAT YOU CAN FILL 386 FRIENDS.
OF THE NOTES AND THEN CONFER WITH THE STATE ON WHAT THE ANNUAL RENT INCREASE FORMULA IS.
THE ANNUAL REST MAY BE ADJUSTED EACH YEAR BASED ON THE LESSER OF THE AREA MEDIAN INCOME CALCULATION FOR A GIVEN YEAR, OR THE PERCENTAGE CHANGE OF THE ANNUAL AVERAGE VALUE OF THE CALIFORNIA CONSUMER PRICE INDEX FOR ALL URBAN CONSUMERS. FOR THE MOST RECENT CALENDAR YEAR OF ACTUAL DATA, THE LESSER OF THOSE TWO OR THE LOWEST OF THE TWO.
THAT'S NOT GOOD. CAN YOU GO OVER THE TIMELINE? WHEN WOULD WE EXPECT TO HEAR BACK FROM THEM? DO THEY HAVE DID THEY GIVE US A DATE? AND THEN WHAT TO DO AFTER THAT? YEAH. SO THE TIMELINE AS WE KNOW FOR THIS THIS THIS ROUND IS APPLICATIONS ARE DUE JANUARY 25TH, WHICH IS THE DAY OF OUR NEXT BOARD AGENDA OR BOARD MEETING.
INHALE UNLESS UNLESS YOU KNOW I HAVE WE HAVE ASKED THEY HAVE NOT PROVIDED ANY INFORMATION HOW LONG THAT'S GOING TO TAKE BECAUSE ONE I DON'T THINK THEY EVEN KNOW HOW MANY APPLICATIONS ARE PLANNING TO EVEN RECEIVE.
AND SO AND I DON'T EVEN KNOW WHEN THEIR TARGET DATE WOULD BE ON TRYING TO ISSUE THOSE OUT AND HELD. I CAN'T REMEMBER WHETHER OR NOT THE THIS GO ROUND APPLICATIONS IS FUNDED IN THIS BUDGET PERIOD OR WOULD IT BE FUNDED IN THE UPCOMING BUDGET PERIOD.
SO THEY'VE SAID IN WRITING IS THAT THIS REVIEW THAT WILL NOW SERVE AMENDED SCHOOLS IN JUNE, WHICH WOULD THEN BE APPROVED BY THE LEGISLATURE IN THE JULY BUDGET PROCESS, MY PROFESSIONAL OPINION IS THAT IT IS HIGHLY UNLIKELY THAT YOU WEREN'T HERE BEFORE JUNE TO BECOME A PROFIT FIRM TO KEEP COMPLETELY QUIET IN JUNE.
YEAH, AND THE NEXT ROUND IS DUE IN JUNE.
AND THOSE LIKELY THEN WOULD BE FOR THE NEXT BUDGET PERIOD AS WELL.
SO SO BASICALLY WE MAY NOT KNOW FOR ABOUT SIX MONTHS ON THAT.
SO LIKE THAT'S WHAT I THOUGHT, BUT I JUST WANTED TO CONFIRM IT.
WE SUBMIT NOW THEY'LL REVIEW THEM AND THEN IT WILL BE IN THE NEW ADOPTED BUDGET FOR THE 2324 BUDGET PERIOD AND THEN WE CAN BEGIN POTENTIALLY PROCESS AFTER THAT, THAT TIME FRAME ON THAT.
SO. ANY OTHER QUESTIONS OR COMMENTS? DR. FIERRO? NOPE.
OKAY. AND THIS IS JUST INFORMATION.
SO WE WILL TAKE BACK SOME NOTES AND HELP ADDRESS SOME OF THE QUESTIONS AND COMMENTS.
[01:20:04]
PARTICULARLY, I WANTED TO ADDRESS TRUSTEE BIRKEY REGARDING SOME OF THE FOOD SERVICES.SO WE HAVE BEEN WORKING I'VE BEEN WORKING SIDE BY SIDE WITH MY COLLEAGUE DR.
AND SO THERE IS A COMPONENT OF THE APPLICATION WHERE IT DOES TALK ABOUT ANCILLARY SERVICES.
AND SO WE'VE ALREADY BEGAN HAVING THOSE CONVERSATIONS AND WE'D BE HAPPY TO SHARE AT THE NEXT.
OBVIOUSLY, THERE'S A LOT MORE CONVERSATION THAT NEEDS TO BE HAPPENING BECAUSE IT'S SO AGAIN, THIS IS AN ODD PROCESS BECAUSE WE'RE SUBMITTING THE APPLICATION FOR FUNDING, EVEN THOUGH WE'RE NOT NECESSARILY COMMITTED TO EXACTLY WHAT WE'RE GOING TO DO FROM A DINING PERSPECTIVE ON THAT.
BUT WE HAVE BEEN TALKING AND WE'D LIKE TO SHARE SOME OF THE ANCILLARY SERVICES THAT WE'RE ALREADY THINKING THAT WE CURRENTLY HAVE, THAT WE CAN EXPAND FROM FALCON'S NEST TO MENTAL HEALTH SERVICES AND THINGS OF THAT SORT.
AND THEN I KNOW ANGEL ALREADY MENTIONED IT, BUT TO ADDRESS TRUSTEE LEWIS'S QUESTION ON THAT BEFORE WE EVEN EMBARKED ON THE FEASIBILITY STUDY THAT WE'RE CURRENTLY WORKING ON, JUST PRIOR TO THAT, WE ACTUALLY DID GO THROUGH A DEMAND STUDY AND THAT'S WHAT ANGEL WAS WAS TALKING ABOUT, BECAUSE ONE, WE WANTED TO FIGURE OUT, ARE WE GOING THROUGH THIS PROCESS? IS IT EVEN WORTH IT FOR US? WHY GO THROUGH THIS PROCESS IF THE DEMAND WASN'T THERE? AND BUT BASED ON HER SURPRISED THAT IT ACTUALLY SHOWED TREMENDOUS DEMAND WAS WAS THERE ON THAT.
AND THAT'S WHAT EMBARKED US TO MOVE FORWARD WITH THE FEASIBILITY STUDY SO WE COULD SHARE A LITTLE BIT MORE DETAILS ABOUT THAT DEMAND STUDY THAT WE WENT THROUGH, WHICH WAS DONE JUST RECENTLY. AND SO AND THEN THAT WOULD HELP ANSWER ANY OF THOSE DEMAND QUESTIONS THAT YOU MAY HAVE.
AND SO SO AFTER DAY, TODAY WAS JUST INFORMATIONAL.
WE'LL TAKE SOME OF THIS FEEDBACK ON AND INCORPORATE IT INTO THE APPLICATION PROCESS.
AND THEN THE GOAL WOULD BE TO AGAIN PRESENT AT THE NEXT BOARD MEETING ON THE 25TH.
JUST FOR ALSO A HEADS UP, ALSO INCLUDED IN THAT BOARD AGENDA WOULD BE A AN AGREEMENT WITH FOR A SECURE CONSULTANT THAT IS A COMPONENT OF THE APPLICATION.
SO OBVIOUSLY WE WANT TO MAKE SURE WE HAVE AN APPLICATION THAT'S THAT MEETS ALL THE REQUIREMENTS.
SO YOU'LL SEE THAT AGREEMENT ON THERE.
AND SO I JUST WANTED TO GIVE YOU A HEADS UP ON ON THOSE TWO ITEMS. WOULD IT BE TOO PREMATURE TO COME UP WITH A SURVEY TO START ASKING STUDENTS ON CAMPUS THEIR THOUGHTS ON HOUSING AND NEEDS AND WHAT WOULD BE APPEALING, WHAT WOULD NOT BE APPEALING? I BELIEVE THAT WAS PART OF THE DEMAND STUDY.
YEAH. SO WE HAVE THE MONEY STUDY, A COMPREHENSIVE ONE, AND PRIOR TO THAT WE HAVE A SURVEY ON PREFERENCE THAT WE CAN BRING TO YOU THE NEXT BOARD MEETING. YEAH. THAT'S ALREADY BEEN YEAH, THAT WAS ALREADY DONE.
YEAH. SO THAT WAS DONE EARLY IN 22.
YEAH. YEAH. THIS, THIS PASSED LAST YEAR.
AND SO WHAT THAT ACTUALLY ENTAILED HOW WE CAME UP WITH THE THREE, THE THREE MODELS OF, OF DESIGN, THE DOUBLE OCCUPANCY OCCUPANCY WAS ALL BASED AND DRIVEN OFF THAT DEMAND STUDY WHAT THE STUDENT WOULD WANT.
AND SO THAT'S HOW THAT WHOLE THING WAS FORMULATED BASED ON THE DEMAND.
AND SO, YEAH, WELL, HAPPY TO SHARE THAT THAT INFORMATION AS WELL.
DO YOU KNOW, OFF THE TOP OF YOUR HEAD HOW MANY STUDENTS PARTICIPATED? I WANT TO MENTION A BUNCH.
IT WAS THOUSANDS. YEAH, IT WAS.
IT WAS. IT WAS THOUSANDS ACTUALLY.
WE ACTUALLY GAVE AWAY A COUPLE OF OF LAPTOPS TO TO POTENTIAL WINNERS.
SO IF YOU ACTUALLY SO THAT TO HELP ENGAGE THE DEMAND OF THE SURVEY SO SO TWO TWO STUDENTS WERE ACTUALLY SELECTED AND PROVIDED FREE LAPTOPS AS AS A TOKEN THEY WERE THE WINNERS FROM FROM THAT SURVEY ON IT.
WE'RE HAPPY TO SHARE THAT INFORMATION AS WELL.
BUT IT WAS IT WAS QUITE A BIT.
WE WERE ACTUALLY QUITE SURPRISED ON THE ON THE DEMAND OF THE SURVEY.
SO ANYONE ELSE BEFORE WE ADJOURN?
[01:25:07]
THANK YOU SO MUCH, PHILIPPE AND TEAM.RIGHT. WE WILL ADJOURN THIS MEETING.
THANK YOU.
* This transcript was compiled from uncorrected Closed Captioning.