Title
Incorporated County of Los Alamos Resolution No. 26-08; A Resolution Relating to the Development of a Workforce Housing Facility on County Parcel A-8-A and Approving the Execution and Delivery of a Memorandum of Understanding Relating Thereto
Recommended Action
I move that Council adopt Resolution No. 26-08, A Resolution Relating to the Development of a Workforce Housing Facility on County Parcel A-8-A and Approving the Execution and Delivery of a Memorandum of Understanding Relating Thereto.
County Manager's Recommendation
The County Manager recommends that Council adopt the Resolution and Memorandum of Understanding as requested.
Body
Project Chronology
July 2024: The County issued a solicitation for the lease or sale and development of the A-8-A parcel to create affordable workforce housing in a higher-density neighborhood adjacent to downtown.
July 2025: The County and Servitas, LLC entered into a nonbinding term sheet for the development of approximately 380 workforce housing units on the 22-acre parcel. The plan includes 120 County deed restricted 1-, 2-, and 3-bedroom units for households earning between 60% Area Median Income (AMI) and 100% AMI with an average of 80 % AMI. In addition there will be 98 state of New Mexico deed restricted 1-, 2-, 3-bedroom units for households earning up to 120% AMI.
September 2025: Council approved Ordinance No. 746, authorizing the sale and development of the property by Servitas and outlining the additional steps necessary to complete the project.
March 2026: Following the completion of due diligence and site plan approval, property ownership was transferred from the County to Servitas-Los Alamos Housing 1, LLC, which currently holds fee simple title.
Next Steps
This action fulfills commitments established in the development agreement and the MOU formalizes the partnership between Los Alamos County and Madrone Community Development Corporation (Madrone), a California nonprofit 501(c)(3) public benefit corporation. Under this arrangement, Madrone (through a dedicated New Mexico LLC) will serve as the borrower and owner of the project to finance the development of the A-8-A parcel (now known as "Coyote Mesa").
The project utilizes the nonprofit ownership model to minimize costs. As a 501(c)(3) entity, Madrone can access tax-exempt bond financing at lower borrowing rates and operates with significantly lower overhead than traditional for-profit developers. Madrone will receive an initial fee from bond proceeds and an ongoing annual fee from project revenues.
As contemplated in the development agreement, Servitas intends to sell the property to Madrone's New Mexico LLC. Once finalized, this entity will own and provide Servitas the financing for the development, construction, and long-term operation of the project.
After operating costs and debt service are covered, any net cash flow from the project will be provided to the County or applied as the County directs. Upon the retirement of the bonds, the property and all improvements will be reconveyed to the County or a designated nonprofit for continued community benefit.
A future Coordination Agreement will establish a joint committee between the County and the nonprofit. This committee will serve in an advisory oversight capacity regarding construction, management, and the review of annual project budgets.
Alternatives
Council may decline to adopt the resolution. This would prevent the execution of the MOU and terminate the ability to finance the project as contemplated, which would impact project viability and the development of 380 units and any permanent affordability.
Fiscal and Staff Impact/Planned Item
This project is financed through third-party bond sales and does not require a direct County appropriation for construction. Staff impact is limited to participation in the joint advisory committee.
Attachments
A - Resolution No. 26-08
B - MOU26-880 - Incorporated County of Los Alamos and Madrone Community Development Corporation
C - Notice of Public Hearing of Resolution 26-08