University Medical Center image via Google Earth

The Fresno City Council took a vote Wednesday to distance itself from an 800-unit affordable housing project two years in the making. Now the County of Fresno is reevaluating its next steps to make the project a reality.

Councilmembers voted 6-0 to withdraw from signing onto an affordable housing project on the 36-acre site at the former University Medical Center campus at Kings Canyon Road and Cedar Avenue.

The Fresno Bee reported that the council balked on the project as a result of a county employee facing felony charges for conflict of interest.

ABC30 reported that Steve Rapada, a former chief of staff to Fresno County Supervisor Sal Quintero, had received a $16,000 consulting fee from Fresno-based Construction Management Group (CMG), the company who bought the property from the County.

The County of Fresno sold for $4 million the 33-acre old hospital complex back in 2019 to CMG in order to transform it into affordable housing.

Fresno County purchases University Medical Center building

Under state law, in order to sell land, governments normally must first declare it a surplus. Public agencies have right of first refusal before it goes out to bid. Rules do stipulate, however, that if the proposed site were to be developed for affordable housing, it could be sold directly to an interested party under the promise it would have an affordable housing component for at least 30 years.

In order to move forward with the project, the County of Fresno needed an agency with an affordable housing covenant with the state. That’s where the City of Fresno came in.

“For the City to turn down a project that offers this many affordable housing units, it is really upsetting,” said Fresno County Administrative Officer Jean Rousseau.

Rousseau said that over the two years since CMG approached the County about developing the project, they had been working to relocate county employees still working there to other properties.

Fresno County counsel had reviewed the conflict of interest and had determined that it wasn’t enough to nix the project, Rousseau said.

The Fresno County District Attorney’s Office has had the felony conflict-of-interest case for nine months and is currently going through the judicial process, he said.

Multiple messages left for members of the Fresno City Council were not returned.

“We’re still going through the ‘Are you kidding me? They killed the deal at the last minute’ phase,” Rousseau said.

Rousseau said that area of town desperately needs affordable housing. The project, which Rousseau estimates could have a price tag of upwards of $100 million, would bring 800 units online with mixed-use commercial space. Forty percent of those units would be considered affordable.

Calls made to CMG were not returned.

In order to move forward, CMG and the County of Fresno need an agency with an affordable housing covenant to sign a regulatory agreement on the project.

County officials are now considering using Fresno Housing as a signatory. Developing the project into housing would still require a rezone at the city level.

“Hindsight is 2020, but we thought we thought we had a good partner with the City,” Rousseau said.