AGENDA TITLE:
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Present Option to Cancel Award of Request for Proposal for the Access Center and Emergency Shelter Operations Approved on September 6, 2023 Due to Lack of Funding Sustainability and Definitive Scope Change Develop a New Request for Proposal (CD)end
MEETING DATE:
April 16, 2025
PREPARED BY:
Jennifer Rhyne, Neighborhood Services Manager
recommendation
RECOMMENDED ACTION:
Present option to consider repealing 2023 resolution to cancel award of Request for Proposal for the Access Center and Emergency Shelter operations approved on September 6, 2023, due to lack of funding sustainability and definitive scope change and develop a new Request for Proposal.
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BACKGROUND INFORMATION:
On May 3, 2023 City Council authorized the Community Development Director to release a Request for Proposal (RFP) for operating the permanent Lodi Access Center and Emergency Shelter (“Access Center”) and waive the formal bid process to limit bid responses to The Salvation Army and Inner City Action Inc. based on their respected service to the Lodi community.
Staff developed an RFP with objective criteria required to operate the Access Center and released the RFP on May 22, 2023 and received responses from both The Salvation Army and Inner City Action. On September 6, 2023 City Council Awarded the RFP to The Salvation Army, Lodi Corps. The Salvation Army’s proposal estimated the cost of operations annually for 100 beds at $2,774,078 (includes some start-up costs) with an anticipated 3% increase annually.
Since the September 6, 2023, adoption of Resolution 2023-___ awarding the RFP, Staff has been working diligently in collaboration with the City’s contracted grant writers to apply for all available grants to sustain operational funding of the Access Center. While there have been some small awards achieved, the funds are not sufficient to maintain operations at a cost of $2.8 million annually. Additionally, grants available for shelter operations have reduced significantly over the past several years and Staff anticipate this trend continuing.
Beyond the successful award of the construction bid for the Access Center, City Council set aside approximately $2.8 million of American Rescue Plan Act (ARPA) funds for up to year of operations through 2026 for the permanent facility. Should City Council agree with staff’s recommendation on the re-issuance of the RFP, these funds must still be utilized towards the Access Center project prior to the expenditure deadline of December 31, 2026. This is due to the requirement by the U.S. Department of the Treasury for State and Local Fiscal Recovery Funds to fully obligate funds by December 31, 2024 and the City obligating these funds for the Access Center. Any remaining funds not allocated to operations, would be used as necessary for the successful completion of the Access Center and Workforce Education Center capital improvements and will be brought back to City Council for final consideration.
To ensure sustainable funding for Access Center operations, Staff recommends developing a new RFP that accounts for the reduced bed count and operations planned under the revised Access Center plans, and requires proposed operators to demonstrate a financial model that includes drawdown reimbursement from CalAIM/Medi-Cal, identify grant/foundations/philanthropy resources as applicable or provide a like model acceptable by the City to offset costs of operations. This would be a definitive scope change from the original RFP intended to reduce the overall financial impact to the City.
CalAIM/Medi-Cal Community Supports offer enrollees coordinated and equitable access to services that address their physical, behavioral, developmental, dental, and long-term care needs. Opportunities available include, Enhanced Care Management; Housing Transition/Navigation Services; Housing Tenancy and Sustaining Services; Housing Deposits; Stabilization Centers and Recuperative Care.
Proposed operators will need to be Medi-Cal/CalAIM certified or be able to demonstrate their ability to contract with a Medi-Cal/CalAIM certified billing agency to provide the services for them or a similar like model accepted by the City. Staff anticipates adding this requirement to a new RFP, will provide a more fiscally feasible approach to operating the Access Center long term.
Potential RFP Factors for Council Consideration:
• Lease facility for $1
• Lease facility for $1 for five years, upon successful operations for that term, sell the facility to the operator for $1.
o Once the deed is transferred to the operator, it will continue to be restricted for shelter use only and operator will be required to provide monthly, quarterly, and annual reports demonstrating continued outcomes and metrics as designated by the grants utilized to develop the Access Center.
• Sell the facility to the operator for $1, so that the operator has the opportunity to leverage the property for any non-reimbursable expenses through other resources.
o Once the deed is transferred to the operator, it will continue to be restricted for shelter use only and operator will be required to provide monthly, quarterly, and annual reports demonstrating continued outcomes and metrics as required by the grants utilized to develop the Access Center.
o In the event of insolvency, lack of performance, or breach of contract, the property would revert back to the City.
o This option would transfer deferred maintenance responsibility to the operator and lesson the long term financial burden to the City.
Similar to other large scale initiatives within the City, Staff anticipates following the below procurement process should a new request for proposal be authorized at a future Council Meeting.
• Develop RFP
• Release RFP to known potential operators, newspaper public notice, City website, and Continuum of Care contact list
• Evaluation Committee will be created to review, score, and provide recommendation for award
• Once received RFP’s will be evaluated by Evaluation Committee and top 3 selected
• Interviews will be scheduled with top 3 proposals
o If 3 proposals or less are received, as long as all eligibility criteria is met, will schedule interviews with all proposers
• Evaluation Committee will determine final recommendation to bring to City Council
• Evaluation Committee recommendation will be presented to City Council to request award of RFP
Staff requests City Council direction on whether to repeal Resolution 2023-204 canceling the award of Request for Proposal for the Access Center and Emergency Shelter operations approved on September 6, 2023 due to lack of funding sustainability and definitive scope change and provide direction to develop a new Request for Proposal and bring back to City Council at a future date.
STRATEGIC VISION:
4C. Housing: Continued progress towards Regional Housing Needs Assessment goals.
FISCAL IMPACT:
Not applicable at this time, presentation only. Current RFP status has an impact of approximately $2.8 million of ARPA fund. If approved to release a new RFP at a future City Council Meeting, cost implications are currently unknown, however the RFP will require proposals to include identified cost offsets. Any cost savings of ARPA funds towards operating will have to remain allocated to the Access Center project as obligated on the December 31, 2024 quarterly ARPA report and reporting requirements provided by the U.S. Department of the Treasury for State and Local Fiscal Recovery funds AKA ARPA funds.
FUNDING AVAILABLE:
APRA-22001.Contracts through 2026. Future funding availability unknown at this time.
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John Della Monica
Community Development Director
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Christina Jaromay
Acting City Manager