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HomeMy WebLinkAboutStaff Report 4.B 10/05/2015DATE: TO: FROM: October 5, 2015 Honorable Mayor and Members of the City Council John C. Brown, City Manager Agenda Item #4.B SUBJECT: Resolution Recommending Appointments to the Mayors' & Councilmembers' Association to Fill Vacancies on the Executive Board of the North Bay Division of the League of California Cities RECOMMENDATION It is recommended that the City Council adopt the attached resolution recommending appointments to the Mayors' & Councilmembers' Association and giving the Mayor or his designee authority to vote on late nominations received at the Association's October 8, 2015 meeting. BACKGROUND The Mayors' & Councilmembers' Association, which includes all the Sonoma County cities, fills vacancies on various local or regional Boards or Commissions when the terms of office expire or upon resignations. Letters of interest are circulated to all cities by those elected officials wishing to serve, followed by the cities voting on their recommendations at an upcoming meeting of the Association. Board of Directors Appointment: North Bay Division of League of California Cities, Executive Board. Two positions, two year terms, to fill the expiring terms of Laurie Gallian (Sonoma) and Susan Harvey (Cotati) whose terms expire on October 13, 2015. The City received late notice of these expiring positions, and letters of interest may not be received from other cities prior to packet delivery. Late arriving letters will be placed on the dais at the October 5th Council meeting. ATTACHMENTS Resolution 2. Letters of Interest ATTACHMENT 1 RESOLUTION RECOMMENDING APPOINTMENTS TO THE MAYORS' & COUNCILMEMBERS' ASSOCIATION TO FILL VACANCIES ON THE EXECUTIVE BOARD OF THE NORTH BAY DIVISION OF THE LEAGUE OF CALIFORNIA CITIES WHEREAS, vacancies have occurred on various Boards and Commissions due to term expirations or elected members leaving office; and WHEREAS, the appointments will be considered by the Board of Directors at the Mayor's & Councilmembers' Association meeting on October 8, 2015; and WHEREAS, letters of interest have been received and considered by the Petaluma City Council. NOW, THEREFORE, BE IT RESOLVED that the Petaluma City Council does hereby recommend to the Mayors' & Councilmembers' Association the following people to fill the vacancies on: for the North Bay Division of the League of California Cities BE IT FURTHER RESOLVED that the Petaluma City Council authorizes Mayor David Glass or his designee to vote on late nominations received at the Mayors' & Councilmembers' meeting on October 8, 2015. 2 ATTACHMENT 2 LETTERS OF INTEREST DATE: October 5, 2015 Agenda Item #5.A TO: Honorable Mayor and Members of the City Council through City Manager FROM: Sue Castellucci, Housing Administrator SUBJECT: Resolution Approving the Issuance by the California Municipal Finance Agency of Multifamily Housing Revenue Bonds for the Propose of Financing the Acquisition / Rehabilitation of Washington Creek Apartments and Corona Ranch Apartments. RECOMMENDATION It is recommended that the City Council Adopt the Attached Resolution Approving the Issuance of Multifamily Housing Revenue Bonds by the California Municipal Finance Agency for the Purpose of Financing the Acquisition/ Rehabilitation of the Washington Creek Apartments and Corona Ranch Apartments. BACKGROUND Washington Creek Apartments: The Washington Creek Apartment project is an existing 32 -unit affordable housing rental apartment facility, located at 909 Martin Circle. The project was built in 1993. The property has sixteen two-bedroom townhouses located above sixteen three bedroom flats. The project will include substantial rehabilitation to address replacement of major building systems and will increase energy and water efficiency. Also the rehabilitation will target a site -wide 40% reduction in portable water use and a 50% reduction in onsite gas and electricity consumption. This project was originally financed with a State program called Rental Housing Construction Program (RHCP), a program no longer funding affordable housing and has a compliance period to 2021. With the rehabilitation of the project, the City's Regulatory Agreement will be extended for another 55 years at the same level of affordability. Rents will be restricted by the RHCP regulatory agreement to households with incomes no greater than 60% of the area median income. Corona Ranch Apartments: The Corona Ranch Apartment project is an existing 74 -unit affordable housing rental apartment facility, located at 990 Ely Road. The project was built in 1994. The property has 32 two bedroom townhouse units; 32 three bedroom flats and 10 four bedroom flats. All ground floor units are accessible to the disabled with 2 three bedroom units and 2 four bedroom units customized for residents with an immobility disability. The project will include substantial rehabilitation to address replacement of major building systems and will increase energy and water efficiency. Also the rehabilitation will target a site -wide 40% reduction in portable water use and a 50% reduction in onsite gas and electricity consumption. This project was originally financed with a State program called Rental Housing Construction Program (RHCP), a program no longer funding affordable housing. The City of Petaluma's Regulatory Agreement has a compliance period to 2023. With the rehabilitation of the project, the City's Regulatory Agreement will be extended for another 55 years at the same level of affordability. Rents will be restricted by the RHCP regulatory agreement to households with incomes between 35% to 60% of the area median income for Sonoma County. DISCUSSION The goal of the requested City Council action is to complete the financing plan to allow the start of rehabilitation of Washington Creek and Corona Ranch in February 2016. The developer has requested that the California Municipal Finance Agency (CMFA) issue bonds for the project. The City has been a member of that Joint Powers Agreement since January 2004. There are a series of actions necessary to accomplish this transaction: (1) The Internal Revenue Code of 1986 requires that the City Council conduct a public hearing known as a TEFRA hearing (Tax Equity Fiscal Reform Act) to authorize the issuance by another agency of tax exempt housing revenue bonds. The TEFRA hearing is simply an opportunity for all interested persons to speak or to submit written comments concerning the proposal to issue debt and the nature or location of the proposed project. (2) Adopt a resolution approving the issuance of multi -family revenue bonds, required in the application for bond allocation. FINANCIAL IMPACTS The City's membership in CMFA bears with it no cost or other financing obligations, but selves as a public acknowledgement by the City of the project financing. The City will not be a party to the bond financing documents. The debt will not be secured by any form of taxation or by any obligation of either the City or CMFA; neither would the debt represent or constitute a general obligation of either the City or CMFA. Pursuant to the governing California statutes and the JPA Agreement, a member of CMFA is not responsible for the repayment of obligations incurred by CMFA. The debt will be payable solely from amounts received pursuant to the terms and provisions of financing agreements to be executed by Eden Housing Inc. In the financing documents the developer will also provide comprehensive indemnification to CMFA and its members, including the City. ATTACHMENTS 1. Resolution 2 RESOLUTION NO. CITY OF PETALUMA RESOLUTION OF THE CITY COUNCIL APPROVING THE ISSUANCE OF MULTIFAMILY HOUSING REVENUE BONDS FOR THE PURPOSE OF FINANCING THE ACQUISITION AND REHABILITATION OF THE WASHINGTON CREEK APARTMENTS AND THE CORONA RANCH APARTMENTS WHEREAS, the California Municipal Finance Authority (the "Authority") is authorized by the laws of the State of California (the "Law") to execute and deliver multifamily housing revenue obligations for the purpose of financing the acquisition, construction/rehabilitation and development of multifamily residential rental facilities located within the area of operation of the Authority which are to be occupied by very low and low income tenants; and WHEREAS, Eden Housing Inc, a California nonprofit public benefit corporation, on behalf of a limited liability company or limited partnership related to or to be formed by Eden Housing Inc (the "Borrower"), has requested the Authority to issue and deliver multifamily housing revenue obligations in the anticipated principal amount of $25,000,000 (the "Obligations"), the proceeds of which may only be used for the purpose of financing the acquisition and rehabilitation of two affordable housing developments 1) a 32 -unit multifamily residential rental facility commonly known as Washington Creek Apartments located at 909 Martin Circle in the City of Petaluma, California and 2) a 74 -unit multi -family residential rental facility commonly known as Corona Ranch Apartments, located at 990 Ely Road in the City of Petaluma (collectively, the "Project") and; WHEREAS, the Obligations which are expected to be issued and delivered to finance the acquisition and rehabilitation of the Project would be considered "qualified exempt facility bonds" under Section 142(a) of the Internal Revenue Code of 1976, as amended (the "Code"), and Section 147(f) of the Code requires that the "applicable elected representatives" with respect to the jurisdiction in which the Project is located hold a public hearing and approve the issuance and delivery of the Obligations; and WHEREAS, the City Council of the City of Petaluma as the "applicable elected representatives" to hold said public hearing, has held said public hearing at which all those interested in speaking with respect to the proposed financing of the Project were heard. NOW, THEREFORE, BE IT RESOLVED as follows: 1. The City Council hereby finds and determines that the foregoing recitals are true and correct. 3 2. For purposes of the requirements of the Code only and in accordance with Section 4 of the Joint Exercise of Powers Agreement Relating to the California Municipal Finance Authority, dated as of January 1, 2004, the City Council hereby approves the proposed financing of the Project by the Authority with the proceeds of the Obligations. Not to exceed $7,500,000 of the Bonds may be utilized for Washington Creek Apartments and not to exceed $17,500,000 of the Bonds may be utilized for Corona Ranch Apartments. 3. The issuance and delivery of the Obligations shall be subject to the approval of and execution by the Authority of all financing documents relating thereto to which the Authority is a party and subject to the sale of the Obligations by the Authority. 4. The adoption of the Resolution is solely for the purpose of meeting the requirements of the Code and shall not be construed in any other manner, neither the City nor its staff having fully reviewed or considered the financial feasibility of the Project or the expected financing or operation of the Project with regards to any State of California statutory requirements, and such adoption shall not obligate (i) the City to provide financing to the borrower for the acquisition and rehabilitation of the Project or to issue the Obligations for purposes of such financing; or (ii) the City, or any department of the City, to approve any application or request for, or take any other action in connection with, any environmental, General Plan, zoning or any other permit or other action necessary for the acquisition, rehabilitation, development or operation of the Project. 5. The City Clerk of the City shall forward a certified copy of this Resolution to: Stephen Melikian, Esq. Jones Hall, A Professional Law Corporation 475 Sansome Street, Suite 17 San Francisco, California 94111 6. This resolution shall take effect upon its adoption. PASSED AND ADOPTED this 5th day of October 2015 by the following roll call vote: 4