The U.S. Department of Housing and Urban Development on Thursday proposed a rule that would limit public housing mostly to citizens, which advocates fear could lead to tens of thousands of people being evicted.

The rule, published in the Federal Register, calls for limiting funding for those in public housing and other HUD-related housing to citizens and eligible noncitizens. The rule would require every resident in HUD-funded housing to show proof of citizenship or eligible status, including those 62 years and older who previously only had to show proof of age.

The measure would effectively bar mixed status families —- where some household members are eligible for help — from housing and is part of the government’s immigration crackdown. A similar rule was proposed but never finalized during the first Trump administration and is mentioned as a policy priority in the conservative blueprint Project 2025,

“Under President Trump’s leadership, the days of illegal aliens, ineligibles, and fraudsters gaming the system and riding the coattails of American taxpayers are over,” HUD Secretary Scott Turner said in a statement.. “HUD’s proposed rule will guarantee that all residents in HUD-funded housing are eligible tenants. We have zero tolerance for pushing aside hardworking U.S. citizens while enabling others to exploit decades-old loopholes.”

The proposed rule will be made official when it’s published in the Federal Register on Friday. HUD did not answer how long it may take before the rule takes effect.

Housing advocates were quick to criticize the move.

“Our country can ensure that every one of us, no matter where we come from or what language we speak, has a safe home,” Shamus Roller, the executive director of the National Housing Law Project said in a statement. “Instead, Trump is trying to evict immigrant families, citizen and non-citizen, from HUD housing.

In December, the left-leaning Center on Budget and Policy Priorities estimated that up to 20,000 families or as many as 80,000 people could lose assistance due to changes in eligibility that would overturn a rule that has been in place for decades.

The impact of the rule could affect many more people who struggle to provide proper documentation. About 3.8 million adults with citizenship lack any form of documentation proving their citizenship, and another 17.5 million cannot easily get the documents.

“Everyone deserves an affordable home, including our neighbors, friends, and coworkers who are immigrants,” said Sonya Acosta, a senior policy analyst with the Center. “This rule would force 20,000 families with mixed immigration statuses to make the agonizing choice between losing the assistance that helps them pay rent every month or separating their family. People without a documented immigration status have never been eligible for rental assistance.”

With a 6-1 vote in favor of the ordinances and summit recommendation – only Councilman Andrew Sandoval voting against it – the item will return for a second reading at the next meeting on Feb. 24.

Homeless advocates are hopeful about the proposed summit, but say for the roughly 1,250 people without homes in Salinas, the reduced notice times could make traumatic encampment sweeps more frequent.

“We’re certainly taking a step backwards,” said Wes White, co-president of the Salinas/Monterey County Homeless Union.

The reduction of notice times, along with other prohibitions included in the ordinances against obstructing sidewalks and public spaces, serve to update the city’s municipal code in alignment with Governor Gavin Newsom’s statewide recommendations on best practices for addressing encampments. The state’s recommendations are not required however, with Monterey County still adhering to a policy of 72 hours of notice.

“The logic behind (the ordinance) is to prevent large encampments…from gaining a foothold,” said Assistant City Manager Lisa Murphy. “All of these combined will ensure our actions are lawful, they’re effective and they’re compassionate.”

Compassion was something brought up a number of times by staff, council members and during public comment. What that compassion looked like however, varied widely.

“I heard a lot tonight about the 1,240 homeless residents that we have but I don’t really hear us talking about the other 164,000 residents that live in the city of Salinas,” Councilman Jose Barajas said.

Barajas cited the cost of cleanups, threats such as structure fires and crime as reasons to be stricter on encampments in Salinas. Barajas also said that spending on homeless services–$57.6 million of grant money to date–far exceeds that spent per capita on the average Salinas resident.

Many however, questioned what shortening the notice time of a sweep will accomplish in the way of reducing homelessness.

“This is not a tool to address homelessness…this is a tool to remove folks faster,” said Sandoval.

Tim Heavin of the Coalition of Homeless Services Providers, echoed this, saying “this is not solving homelessness, this is chasing human beings in circles…they are being pushed from city land to county land to state land to railroad property and then swept again.”

Dr. John Silva, a longtime Salinas physician, also pointed out that swifter and more frequent encampment sweeps would likely have serious health impacts for the unhoused.

“Because of the disorganization ensuing after a sweep, there are ruptures in continuity of care,” said Silva. These ruptures in care can be traumatic for people struggling with mental illness and often cause those dealing with substance abuse to lapse in treatment.

“The substance abuse data shows that for 400 people getting substance abuse treatment, (when) the sweep occurs, one of them dies,” Silva said. “The shortening of sweep notices…will make these harsh realities worse.”

A notable absence from the meeting were members of the unhoused community who would be affected by the sweeps, something that both the public and council members hoped to change with the proposed intergovernmental homelessness summit.

“Let’s invite the residents, let’s invite the unhoused, let’s invite everyone so they can give their input, but we need to do something,” said Councilman Tony Barrera.

Currently, there is no date for the summit but the item will be discussed at the next city council meeting starting at 4 p.m. on Feb. 24 at the Salinas Rotunda. The meeting can be watched live at https://www.youtube.com/@thesalinaschannel

Chris Hamilton is a California Local News fellow covering Salinas and the Salinas Valley for The Herald.

Inventory in December was 413 units in the county, up 7% from the previous year. Closed sales at the end of 2025 increased 8% year-over-year, while new listings grew 8% compared to the same time last year.

“The Monterey County real estate market at the end of last year reflected shifts in buyer expectations and sellers adapting accordingly,” explained Monterey County Association of Realtors Government & Community Affairs Director Adam Pinterits. “Price adjustments have been growing more common as sellers revisit their priorities, but this effect is muted compared to other regions because of decades of restrictions on construction. Average days on market are increasing, as sellers prioritizing the highest price wait longer to find the right buyer.”

In Monterey County, the median single-family home sold in 26 days for 98% of the list price based on 155 sales in December 2025, according to MLSListings.

In neighboring San Benito County, the median single-family home cost $762,500 and sold in 37 days for 98% of the list price based on 40 sales in December 2025. Its inventory was 92, down 2% from December 2024. The number of new listings was down 4% from the previous year. While in neighboring Santa Cruz County, the median single-family home cost $1.27 million and sold in 39 days for 98% of the list price based on 106 sales at the end of 2025. Its inventory was 238 and unchanged from December 2024. The number of new listings for the month of December was down 8% from December of last year.

The National Association of Realtors has said that with more homes on the market and slightly improved affordability, first-time homebuyers will have better opportunities in 2026.

According to the California Association of Realtors, both home sales and the median price are projected to inch upward this year.

This year “promises further shifts, and potentially more opportunities,” said Pinterits. “Conversations in Sacramento and Washington D.C. suggest a more serious policy focus on housing. What remains to be seen is exactly which policies result from these conversations.”

U.S. News and World Report online says that analysts expect the 30-year fixed mortgage rate to bounce between 6% and 6.5% over the next two years, with some chance that rates could fall below 6% at the end of 2026 and into 2027. However, that could change as markets continue to digest changing economic data.

“There are too many economic variables right now to predict rate changes for the entire year,” said Pinterits.

A 30-year fixed mortgage at 6.5% is a historically great rate, added Pinterits, so many buyers feel their time is now. Other buyers are hoping predictions of one more rate drop this year are accurate.

“What most experts agree on is that we are not going to see the record low rates from early this decade again,” he said. “So don’t wait for that.”

But there may be changes on the horizon to help people seeking homeownership.

“Leaders at all levels of government are discussing new policy ideas,” said Pinterits. “It is important for them to hear from all of us, to urge them to prioritize policies to facilitate more homeownership opportunities and improved affordability.”

The MBEP Tenth Anniversary Gala is scheduled for Jan. 29 from 6:10 to 9:30 p.m., at the Monterey Bay Aquarium. The regional member-supported nonprofit will be recognizing The Pebble Beach Company, Avila Construction, and Tanimura & Antle, for their vision in creating innovative solution to the region’s workforce needs.

Since 2015, Monterey Bay Economic Partnership has brought together public, private, and civic entities located throughout Monterey, San Benito and Santa Cruz counties with the mission to improve the economic health and quality of life in the region.

“In one of the nation’s most expensive housing markets, these organizations have led the way in creating much-needed housing for employees in our region’s agricultural and hospitality sectors and charted a path for others to follow,” said Monterey Bay Economic Partnership President & CEO Tahra Goraya in a press release. “They embrace the challenge with purpose, vision and a dedication to improving the well-being of those that live and work in our region.”

With Monterey County’s median home price in November at about $900,000 and rents for 2-bedroom apartments in Salinas and Monterey averaging between about $2,500 and $2,800 respectively, the need for affordable housing for workers in this housing market is crucial.

In early 2019, The Pebble Beach Co. opened Morse Place Townhomes, an affordable housing complex built on about 3 acres of a 13.2-acre site in the Del Monte Forest. It consists of a 24-unit complex of two- and three-bedroom units, providing much-needed affordable housing for Pebble Beach Co. employees and their families. The project took nearly seven years to construct as a solution by the Pebble Beach Co. to develop its own $8 million affordable housing project instead of having the County of Monterey build the required inclusionary housing.

In 2015, facing workforce challenges that had left $100,000 worth of crops unharvested and placed future harvests in jeopardy, Tanimura & Antle approached Avila Construction with a massive challenge, to build housing for 800 H-2A agricultural workers, with the goal of completing that project within a year. Tanimura & Antle pioneered a new model of guest worker housing in the region with the success of the project and also gave the company an edge in recruiting migrant farmworkers from other states. That development — and the other agricultural workforce housing projects that it inspired — helped boost the number of guest worker visas certified for Monterey County, contributing to a more stable agricultural workforce in the region.

Spreckels Crossing was unprecedented, according to Monterey Bay Economic Partnership, notable as an innovative solution to critical workforce shortages exacerbated by housing and immigration challenges, for the pace at which it proceeded, as well as for the collaborations it required. Its vision earned Tanimura & Antle, and the County of Monterey, MBEP’s first-ever public-private partnership award in 2016.

The Tanimura & Antle development at its headquarters in Spreckels was the brainchild of the agricultural company’s late CEO, Rick Antle, whose vision for housing was unlike the bunk-house style format typically used for ag housing. Instead, he pictured spacious, quality apartments and a high quality of life for his employees.

Avila Construction played an integral role in the entitlement of the project and, upon receiving approvals, immediately proceeded with construction. From concept to completion, this project took about 13 months to complete, including design and entitlements.

Spreckels Crossing did more than create 100 new dorm-style apartments for 800 seasonal farmworkers — it also defied expectations and set a template for others to follow, says MBEP.

Since then, Avila Construction has been consistently working to add to the housing supply in the region, having constructed more than 520 housing units serving more than 4,100 employees, including Casa Boronda in Salinas, Harvest Moon Housing outside Salinas, Walnut & Third in Greenfield, Ag Housing in King City, and Gabilan Housing in Salinas. Royal Oaks Housing, an affordable apartment complex in Morgan Hill, features units dedicated to agricultural workers. The first phase of a 121-unit agricultural housing project for Tanimura & Antle is under construction in Arizona, and a second phase of the King City complex is still to come.

To make Reservations to attend MBEP’s 10th Anniversary Gala, go to https://mbep.biz/10th-anniversary-gala/

Laird represents the 17th Senate District, which includes Monterey and Santa Cruz counties and extends down the state’s coastline to Arroyo Grande in San Luis Obispo County.

“I am honored to be appointed to Chair the Senate Budget and Fiscal Review Committee,” Laird said in the release. “Having previously chaired the Assembly Budget Committee, I understand the seriousness of this responsibility and know there will be difficult times ahead. I look forward to listening to the priorities of my colleagues to shape thoughtful decisions that balance fiscal responsibility with the real needs of Californians.”

Laird has represented Santa Cruz County in the Senate since 2020. Prior to that, he was the California secretary for natural resources from 2011 to 2019 and was also a member of the state Assembly from 2002 to 2008.

Laird takes the budget committee gavel at an especially tenuous time for California as it continues to respond to steep social safety net program cuts that were included in H.R. 1, the federal spending bill passed by Congress and signed by President Donald Trump in July. Anticipating trickle down impacts to surface in a big way next year, budget planners at local governments across the state, including in Santa Cruz County, have been keeping a close eye on how state leaders will respond with their own fiscal plans.

During his tenure as Assembly budget chair from 2004 to 2008, Laird guided investments in education, health care and public services, according to the media release.

“Senator Laird brings deep experience, sound judgment, and a strong commitment to fiscal responsibility to the Budget Committee,” Senate President pro Tempore Monique Limón said in the release. “His previous service as Chair of the Assembly Budget Committee, along with his long-standing focus on education, the environment, and working families, will be invaluable as we work to deliver a budget that reflects California’s values and meets the moment.”

With ashes still smoldering, researchers with the Insurance Institute for Business & Home Safety, an industry-backed group, surveyed 252 homes that had been in the path of the blazes in Altadena and Pacific Palisades.

The group determined that of homes with more than half of their 5-foot zone covered in vegetation or other combustible material, 27% were completely destroyed. That share fell to 9% for homes with flammable material covering less than a quarter of the zone.

Roy Wright, chief executive of the institute, said the findings reveal that “there are ways that we can narrow the pathways of destruction” during climate-driven megafires and “we should have faith and trust in those strategies.”

But as the state works to craft the new fire safety rules ordered earlier this year by Gov. Gavin Newsom, homeowners have voiced concerns about the costs of removing plants, trees, wood fencing and other flammable materials, as well as the prospect of replacing landscaping with gravel or dirt. Some consumer advocates also contend the rules could be used by insurance companies, who’ve backed the regulation, to end homeowners’ coverage.

In response to disagreements over how strictly to enforce the “zone zero” requirements, the California Board of Forestry and Fire Protection said it would wait until March 2026 to continue working on the regulations, blowing past a Dec. 31 deadline to finalize the rules set by Newsom’s order. A 2020 law originally mandated a January 2023 deadline to complete the regulations.

According to Bloomberg News, the latest delay means it could be mid-2029 or later before any mandate takes effect for the roughly 2 million homes in high-risk fire areas.

“California is committed to getting Zone Zero right, not just getting it done, through rules that reflect what LA fire survivors have told us while balancing resilience to the next fire, the realities of the insurance market and what homeowners can reasonably afford,” Anthony Martinez, a spokesperson for Newsom, said in a statement.

The Eaton and Palisades fires in Los Angeles County killed 31 people and destroyed more than 16,000 structures, many of them homes, making the blazes among the most destructive wildfires in California history.

At the start of next year, Berkeley will enact similar 5-foot rules for around 1,000 homes in the Berkeley Hills. In 1991, a catastrophic firestorm killed 25 people and destroyed more than 3,000 homes in the Berkeley and Oakland hills.

While some homeowners supported the ordinance, others worried about costs and questioned whether the requirements were necessary.

“It’s a bit draconian to expect people to rip out existing vegetation that does not pose a fire hazard,” said resident Gina Rieger at the city council meeting in April. “You could have somebody with a succulent garden that they’ve tended for years and years and years.”

There’s a broad consensus among researchers, however, that maintaining “defensible space” around a home is an effective way to prevent embers from sparking a structure during a wildfire, said Michael Gollner, an associate professor of mechanical engineering at UC Berkeley who studies wildfire mitigation.

“This is one of the cheapest and easiest things that you can do that has any immediate and measurable impact,” Gollner said.

While acknowledging the inherent limitations of the latest insurance institute report — including that it assessed only burn areas where at least some homes survived — he described it as an “excellent additional source of information” to other recent studies.

One study by Gollener of more than 47,000 homes in five major California wildfires (excluding the recent Los Angeles fires) found that clearing vegetation within 5 feet, coupled with “home hardening” measures such as installing non-flammable siding and fine-mesh over vents, doubled a home’s expected survival rate from 20% to 40%.

In addition to home hardening, the insurance institute found that the spacing between homes was another critical factor, since a structure is more likely to catch fire if it’s close to another burning structure. Even for homes with fire-resistant features, the chance of evading damage was less than 50% when the nearest structure was within 10 feet. Each additional 10 feet of separation increased the likelihood of no damage by 7-13%, up to 30 feet.

Gollener noted since it’s not feasible to increase home spacing in existing neighborhoods, it’s crucial that all homeowners in fire-risk areas take steps to protect their properties from flames.

“You’re not just making a personal decision, you’re making it for your community,” he said. “We’ve learned that the whole community making a change is what really matters.”

In 2023, California’s median home insurance cost of about $1,200 a year ranked in the middle among all states, according to an analysis of U.S. Census Bureau data by UC Berkeley’s Terner Center for Housing Innovation. Current data from personal finance sites show a similar comparison.

The states with the most expensive insurance are prone to hurricanes or tornadoes, including Florida ($1,887 a year), Louisiana ($1,793), Oklahoma ($1,793), Colorado ($1,769), and Texas ($1,769).

The report found that in California, homeowners typically spend about 1% of their income on home insurance. But households in the bottom quartile — those earning less than $66,000 a year — pay around 3% of their income on average.

“It may surprise people that as recently as a couple of years ago, California’s median home insurance costs ranked in the middle of states across the country,” Zack Subin, co-author of the analysis, said in a statement. “But low-income homeowners already spend more of their income on insurance, and we expect that as costs increase, this affordability challenge will grow. Policymakers need to engage in planning to adapt the state’s housing stock to climate change impacts and develop strategies that protect vulnerable homeowners from being displaced.”

In recent years, homeowners across the state have been hit with double-digit rate increases as insurance companies have scaled back coverage, in some cases refusing to write new policies anywhere in California. Providers said the state’s insurance regulations had kept rates artificially low, making it untenable to take on new customers amid more destructive fire seasons and rising construction costs.

To entice insurers back to the state, regulators adopted a plan that allows providers to justify rate increases using models that account for climate risk. Until approving the reforms late last year, California had been the only state in the nation that prevented such models. Experts expect the changes to raise premiums across the state.

In exchange, insurance companies are expected to write more polices in fire-prone parts areas, where they’ve ended coverage for hundreds of thousands of homeowners over the past decade. The goal is to help get property owners off the FAIR Plan, the state’s expensive high-risk insurance program, which has nearly doubled in size over the past two years to roughly 625,000 homeowner policies.

Even as some major insurers have made commitments to expand coverage, some consumer advocates warn the reforms will lead to steep rate hikes and are deeply skeptical that insurers will actually write more policies in fire-risk communities.

The new report also found that about 16% of California homeowners without a mortgage were uninsured in 2023. Mortgage lenders generally require homeowners to have insurance, meaning that the vast majority of those with a home loan are covered. Nationwide, 21% of homeowners who owned their homes outright were uninsured.

Many rural parts of the state, often with less wealth, had relatively high rates of uninsured homeowners. That included fire-risk areas, such as the Sierra foothills, where uninsured rates were around 20% or higher.

The administration is seeking to redirect the funds toward shorter-term housing and outreach efforts, prioritizing programs that impose work requirements, mandate addiction or mental health treatment and help police close encampments.

California officials estimate the shift could mean a loss of $250 million to $300 million in grant money this year for local homeless housing sites and rental assistance programs statewide.

“While Donald Trump is busy hosting parties and showing off his gold-plated decor, Americans are worried about groceries, rent, and basic stability,” Newsom said in a statement this week. “Most families can’t fall back on inherited wealth or walk away from failure through bankruptcy — but they’re the ones stuck paying for his chaos and incompetence.”

In a statement, the U.S. Department of Housing and Urban Development chastised Newsom and officials from a coalition of 20 states who brought the lawsuit. The states include Oregon, Washington, New York and Pennsylvania.

“HUD is dismayed that the plaintiffs have chosen to misuse the Courts and pursue this delaying tactic to serve their own personal political agenda at the expense of the homeless individuals, youth and families now living on our Nation’s streets,” a HUD spokesperson said.

The long-anticipated updates were made official early this month, when HUD posted notice for $3.9 billion in Continuum of Care funding, the primary source of federal homelessness dollars.

According to the new funding guidelines, local governments will be allowed to use only 30% of those dollars for permanent housing or rental aid, freeing up more money for transitional housing and sober-living programs. In California, 87% the funds currently go toward long-term housing services.

“Our philosophy for addressing the homelessness crisis will now define success not by dollars spent or housing units filled, but by how many people achieve long-term self-sufficiency and recovery,” HUD Secretary Scott Turner said in a statement announcing the funding changes.

The news has sent homelessness service nonprofits in the state scrambling to understand the impact on their programs. Providers worry that, without finding ways to fill the funding gaps, they may be forced to close housing sites and end rental aid efforts, leaving thousands without a crucial lifeline across California’s staggeringly unaffordable rental markets.

Administration officials have argued the shift away from permanent supportive housing and voluntary services is necessary to reverse what they describe as decades of failed polices that have led to rising homeless populations and an explosion in dangerous encampments. They contend that federal homelessness funding has gone to support unsafe housing sites where people frequently use drugs without getting the help they need — a claim homelessness services providers maintain is exaggerated.

In California, homelessness has surged 62% over the past decade to an estimated 187,084 people, though some large counties reported encouraging declines this year. The Bay Area’s estimated homeless population reached 38,891 last year, a 46% spike since 2015. The increases came as housing costs have also soared over the last decade.

The new lawsuit contends the funding changes are illegal because they were made without congressional authorization and are “not supported by evidence or reason.” California officials said the administration’s plans would slash money for “proven strategies to address homelessness,” including supportive housing efforts such as Newsom’s Homekey program, which has funded at least 259 permanent and temporary homeless housing projects.

“This would undo years of progress and destabilize our neighbors who finally found a safe place to live and stability,” California Health and Human Services Secretary Kim Johnson said in a statement. “It’s harmful policy that will lead to devastating health outcomes.”

“I am so thankful I came to VTC … and especially to be here at Lightfighter Village,” said Jon Bolton, a resident of Lightfighter Village. “To have permanent housing that’s based for veterans … I’m just so grateful. I’m grateful to be here.”

Last Friday, the community was treated to food, music and a festive atmosphere for the formal opening of Lightfighter Village which offers 64 studios and seven two-bedroom apartments to homeless veterans. The complex began accepting tenants earlier this year and is 100% occupied.

“What you see here today now, is not just a building, it’s a reflection of our collective commitment to those who have served,” said EAH Housing President and CEO Laura Hall.

EAH Housing is a nonprofit corporation that aims to expand the range of opportunities for everyone by developing, managing and promoting quality affordable housing and thriving communities. Established in 1968, EAH Housing has become one of the largest and most respected nonprofit housing development and management organizations in the Western United States.

“The mission of the VTC is to empower veterans to move from crisis to self-sufficiency,” said Veterans Transition Center of California CEO Kurt Schake. “For three decades VTC has served veterans on the historic Fort Ord. During this time we’ve provided emergency housing and transitional housing but the end goal of all of our programs remains permanent housing.”

A short distance from the VTC offices at Martinez Hall on former Fort Ord Army Base land in Marina, Lightfighter Village, at 229 Hayes Circle, provides 71 permanent rental homes for individuals earning between 30% and 50% of the area median income, with a special focus on those who have experienced homelessness.

“Lightfighter Village was conceived 14 years ago … the aspirational goal was a permanent place for veterans to live with a formal lease and all tenant rights,” said Schake. “This was to be a veteran community to honor all their service and provide for their needs. Named after the host unit at Fort Ord, 7th Infantry Division, the ‘Lightfighters.’”

Schake explained that the VTC is a service provider centered on case management, and it needed a developer – a prominent nonprofit that specialized in affordable housing and understood veterans. VTC selected EAH as its partner and Lightfighter Village is the result.

“I don’t know of another organization that’s so interwoven throughout the county with veterans and homeless … they’re everywhere, and Kurt Schake, the current executive director, has been just amazing,” said Marina Mayor Bruce Delgado.

The Veterans Transition Center now provides 194 beds in its total housing for veterans in need, according to Schake, and the Monterey County Point-in-Time Count for homeless veterans in 2024 was 146.

“Our next goal is to formally reach functional zero where there is a room for every veteran at risk of homelessness, and no vet is forced to live on the streets,” said Schake.

Director of the Monterey County Military and Veterans Affairs Office Jack Murphy said that the challenge of veteran homelessness persists along with the lack of housing, especially affordable housing, which is persistent, especially here on the Central Coast.

“No veteran should be homeless, and no veteran should ever want for housing … and that’s an absolute,” said Murphy. “Housing is a foundation upon which recovery is built on. Lightfighter Village is a realization of a shared commitment towards not only ending veteran homelessness but also honoring the service, and the sacrifice, that every veteran has made in our community and in our nation.”

Lightfighter Village offers a safe and secure community for veterans in perpetuity with each unit featuring energy-efficient appliances, walk-in closets and modern amenities, including a community room, garden, pet wash station, fitness center and resident lounges. It is located within two miles of transit, employment, shopping, medical services and the Veterans Affairs-Department of Defense outpatient clinic, as well as the Veterans Transition Center headquarters at Martinez Hall.

“I think City Council chose the best option (Oct. 21) because it reduces our debt and allocates significant funding to other community projects,” said Marina Mayor Bruce Delgado. “This shows responsible intent for our future financial needs and current residents’ needs for better community buildings and parks.”

Preston Park is a 110-acre, 354-unit townhouse-style, multi-family housing development located off Imjin Parkway and owned by the city of Marina. It was originally built for the U.S. Army in 1989, five years before Fort Ord was closed.

At its Sept. 30 meeting, city staff outlined the upcoming refinancing needs for the Preston Park property, which carries a $36.6 million interest-only loan set to mature on Feb. 1, 2026. The annual debt service is approximately $1.5 million, with no payments applied toward the principal. The city has set aside $13.5 million to pay down a portion of the balance; however, some of these funds may be used to support new city facility projects.

At the Oct. 21 meeting, the city council voted to take out a $30.1 million loan, with a 4.51% interest rate, plus use $6.5 million from its reserves, to pay off the existing loan. The city will consider all refinancing options with an eye to interest rates near the tenth year of the new loan.

Municipal adviser Jim Fabian with Fieldman, Rolapp and Associates said this would be a public debt bond offering, enhanced either by Fannie Mae or Freddie Mac, with a 30-year amortization.

The current interest-only loan originated in 2015 when the city of Marina was not in a good financial position.

Marina City Manager Layne Long said during the meeting that if the city had been on better financial footing at that time, it would have opted to take out a bond for the loan 10 years ago, but all the city could afford at the time was an interest-only loan.

There has been $13.5 million in funding that has been set aside over the last 10 years to help pay off the $36.6 million loan for Preston Park.

In addition to city staff and the city’s finance team continuing to evaluate refinancing options, its focus has been on determining how much of the $13.5 million should be applied directly to the loan versus reserved for other facility needs, and on assessing the long-term fiscal impacts of converting from an interest-only structure to a principal-and-interest payment structure.

“The city will use $6.5 million of the $13.5 million it set aside toward paying off principal in the outstanding $36.6 million Preston Park loan,” said Delgado. “The city will use the other half of the $13.5 million set aside for other community projects such as a new fire station or community center” or other municipal projects.

Now that the city has decided on a way to deal with the refinancing needs of the Preston Park loan, it will next tackle the prospect of what it charges for rents at both its rental properties which include neighboring Abrams Park.

“At a near future date, the city council will discuss how much long term residents – approximately longer than 12-year residents – will pay in rent to address the much lower rents paid by these approximate 110 units compared to everyone else,” said Delgado.