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City seeks $10M housing-related grant for Sunrise Mall plan

By Phillip Pesola–
The Citrus Heights City Council last week voted unanimously to seek a state grant of up to $10 million to be used toward the Sunrise Tomorrow Specific Plan.

Casey Kempenaar, community development director for the city, presented the proposal to the City Council during their Dec. 8 meeting, recommending the city submit a grant application for Higher Impact Transformative (HIT) funding as part of California’s Regional Early Action Planning (REAP) program.

According to a document published by the California Department of Housing and Community Development, REAP funds are intended to be used to invest in housing infrastructure in order to reduce vehicle miles traveled and make housing more affordable for all income groups. The HIT portion of these funds is meant to be used toward novel or innovative approaches to achieving the program goals.

Kempenaar said grant funding, if approved, would go to support infill development on the mall site, paying for frontage improvements, utilities, intersection upgrades and transit-related improvements.

The city’s four-phase plan to guide development at Sunrise Mall includes adding up to 2,200 multi-family residential units, along with 480 hotel rooms, 320,000-square-feet of retail, 960,000-square-feet of office/employment use, and 450,000-square-feet of community or institutional space. The plan requires partnership with private developers to become a reality, but the city has been pursuing efforts to fund infrastructure needs at the site and make the plan “shovel-ready” to attract developers.

According to the city, the first phase aims to develop the unused parking areas over the next five years, with the full plan expected to take 20 years. The second phase will likely incorporate office space, retail, dining, and an extended-stay hotel. The third and final phases include redeveloping the existing mall into a “21st Century Main Street.”

Kempenaar said in order to make the grant application more competitive, the city will allocate $1 million in American Rescue Plan Act (ARPA) funding toward the Sunrise Tomorrow plan, in the event that a grant is awarded. If less than the desired $10 million is awarded, the ARPA funding would be prorated accordingly.

The City of Citrus Heights website explains that the rescue plan funds are federal funds to be used for COVID-19 relief and economic recovery. The city has been allocated $15.7 million in ARPA funds. Previous uses of the funds by the city have included police department staffing, vehicles, and equipment, as well as a small business COVID recovery program.

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