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HomeMy WebLinkAboutcc min 1986/07/28 RDA MINUTES FROM A MEETING OF THE CHULA VISTA CITY COUNCIL/ REDEVELOPMENT AGENCY MONDAY - JULY 28, 1986 - 4:00 P.M. COUNCIL CONFERENCE ROOM °RESENT: ALL STAFF PRESENT: City Manager Goss; City Attorney Harron; Dave Gustafson 1. RESOLUTION - APPROVING INTERIM LOAN DOCUMENTS FOR $500,000 LOAN TO THE ACQUISITION ASSOCIATION FOR ORANGE TREE MOBILEHOME OWNERS 708 ASSOCIATION, INC. AND MODIFYING THE PARKS RENT PROGRAM Assistant Director of Community Development Gustafson high1ited some of the important aspects of the lending statement and lending agreement and addressed some of the changes. The basic structure of the acquisition and conversion of the park would entail three loans: 1) Bank of America loan for $3 million for acquisition of the park; 2) State Mobile Home Program loan for $662,000 and a third loan of the Agency for $500,000. He explained that the first 18-months involves no interest rate on the Agency loan; the second 18-month period calls for a market-rate interest which gives an incentive for the conversion to occur. The loan will be repaid in several ways: 1) as low-income residents purchase their space with our assistance, the debt on the Agency loan will be rolled over and converted to purchase loans for those individuals; should there be money left over which is not taken out by eligible people in those categories, the Agency could repay in cash at the 3-year point. Mr. Gustafson identified a "risk" in that the Agency is in the third position behind the BOA and the State Program (the Agency will be paid back proportionately). Should a number of spaces not sell within the next 3 years, the City could be placed into a position to take possession of those lots in order to recoup the loan. r. Gustafson reviewed the rent program: 1) for the first 18 months, the rent to those people who preferred not to purchase their space would be $301.00 per month. All those who chose to remain in that category would be offered a life- time protection for the structured rent programs. The the second 18 months, the Agency would ask for a subsidy program where the difference would be make up by the Agency between the $301.00 and what needed to be charged to make up for associated costs involved. Staff is proposing that the second 18-months be $301.00 plus pass-thrus for any increase in debt service from the sale of space taxes and homeowners' fees. This would be negotiated with the Housing Authority to provide a subsidy program which would determine the coach owner's income and set up an ongoing monthly payment of subsidy. The subsidy would represent the difference between either $301.00 and what the contract rent would be or 30% of the household income (whichever is higher). After the 36-months, those who chose to remain could do so on a non-transferrable lease. Average cost of a lot in the park would be $28,470. An investor would have to come up with approximately $7,000 for a down payment. In answer to a query from Councilman Malcolm, City Attorney Harron advised that Assistant City Attorney Gil reviewed the lending agreement. Councilman Malcolm expressed concern in having a specific professional review documents before going to Council for approval. He added that clear and definitive guidelines should be made for future Councils. -.....-----.. ----_..._---"..__._,-_.._-~-------~_._"_. -2- Out of 151 possible sales, all but 20 are informally committed to purchasing their space. l~.I.oJùC (Moore/McCandliss) for the resolution to be approved in concept with two items to be returned to the City Council on August 5: 1) amendment regarding potential City-purchase/own and 2) a review by a specialist including the amendment and policy. Councilwoman McCandliss suggested setting a policy to identify in-house those areas of concern before the document is sent to Council for approval. MSUC (McCandl i s s / Mal colm) 1 a Council Conference be scheduled for discussion of special legal assistance with the idea of developing policy as to what types of projects the City would like to see special expertise brought in. Councilman Moore suggested a Conference to discuss a Housing Authority for the City of Chula Vista. REPORT OF THE CITY MANAGER - None W\YOR'S REPORT 1) Part of the contract with Larry Peeples in regard to the Second Harbor Entrance is a concept for development of a non-profit organization to go out and solicit funds. MSUC (Cox/Moore) authorize City Attorney to prepare necessary documents and to work with Larry Peeples to develop a non-profit organization for the purpose of soliciting funds for the Second Harbor Entrance. In answer to a query from Councilman Campbell, Mayor Cox advised that initially this organization would be involved with mostly public relations and not in working directly with various governmental agencies. 2) City Manager Evaluation Rescheduled from August 2, 1986 8:00 a.m. MSUC (Cox/McCandliss) City Manager Evaluation scheduled for Saturday, August 30, 1986 8:00 a.m. Marina suite. 3) MSUC (Cox/Moore) for Closed Session for Section 404 Permit following today's meeting. COUNCIL COMMENTS 1. Councilwoman McCandliss - None 2. Councilman Malcolm presented various information on Hudson Bay developers who have developed major regional shopping centers throughout the country. MSUC (Macolm/McCandliss) referred information to staff for their review and direct that their recommendations and report regarding this firm be returned to the City CounciL as it relates to a proposal on "E" Street and I-5 area. -------. -3- COUNCIL COMMENTS -- continued . Councilman Moore MSUC (Moore/Cox) direct the staff to review the concept of a potential joint effort of the City/Chamber of Commerce of advertising using 3 x 5 cards as presented which would indicate statistical data, business entity, schools, etc. MSUC (Malcolm/cox) to include discussion of personnel matters during today's Closed Session. ADJOURNMENT at 5:13 p.m. to Closed Session. It was reported that the Closed Session adjourned at __.________________.._._._m._~ . _ ____ _ _ __ __._ _.__...___.___..________..._.__.___... . . _m"_'_m__ _. .____..._.