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Home My WebLink AboutCVRC Reso 2009-009CVRC RESOLUTION NO. 2009-009 RESOLUTION OF THE CHULA VISTA REDEVELOPMENT CORPORATION RECOMMENDING CONDITIONAL APPROVAL OF A LOAN FROM THE LOW AND MODERATE INCOME HOUSING FUND IN AN AMOUNT NOT-TO-EXCEED $4,000,000 TO CHELSEA INVESTMENT CORPORATION FOR THE DEVELOPMENT OF A 143-UN]T PROJECT FOR LOW INCOME HOUSEHOLDS KNOWN AS THE LANDINGS II WHEREAS, California Health and Safety Code Sections 33334.2 and 33334.6 authorize and direct the Redevelopment Agency of the City of Chula Vista (the "Agency") to expend a certain percentage of all taxes which are allocated to the Agency pursuant to Section 33670 for the purposes of increasing, improving and preserving the community's supply of low and moderate income housing available at affordable housing cost to persons and families of low- and moderate-income, lower income, and very low income; and WHEREAS, pursuant to applicable law the Agency has established a Low and Moderate Income Housing Fund (the "Housing Fund"); and WHEREAS, pursuant to Health and Safety Code Section 33334.2(e), in carrying out its affordable housing activities, the Agency is authorized to provide subsidies to or for the benefit of very low income and lower income households, or persons and families of low or moderate income, to the extent those households cannot obtain housing at affordable costs on the open market, and to provide financial assistance for the construction and rehabilitation of housing which will be made available at an affordable housing cost to such persons; and WHEREAS, pursuant to Section 33413(b), the Agency is required to ensure that at least 15 percent of all new and substantially rehabilitated dwelling units developed within a Project area under the jurisdiction of the Agency by private or public entities or persons other than the Agency shall be available at affordable housing cost to persons and families of low or moderate income; and WHEREAS, Chelsea Investment Corporation (the "Developer') proposes to construct a 143-unit multifamily rental development, with units affordable to very low households at 50 percent of the Area Median Income (AMI) and to low households at 60 percent of the Area Median Income (AMI) within the Winding Walk master planned community on a vacant site (Lott of Map No. 15479) located east of Eastlake Parkway south of Birch Road and north of Crossroads Street in the City of Chula Vista ("Project'); and WHEREAS, the Chula Vista Redevelopment Corporation (the "CVRC") has determined, based on the evaluation of the development budget, 55-year operating pro forma, sources and uses for the Project that additional financing is appropriate and necessary in order to make the Project feasible; and CVRC Resolution No. 2009-009 Page 2 WHEREAS, the CVRC wishes to provide Developer with a loan of four million dollars ($4,000,000) from the Agency's Housing Fund to assist with the financing gap for the construction of the Project; and WHEREAS, in order to carry out and implement the Redevelopment Plan for the Agency's redevelopment projects and the affordable housing requirements and goals thereof, the Agency proposes to enter into a Loan Agreement (the "Loan Agreement") with the Developer, pursuant to which the Agency would make a loan to the Developer (the "Agency Loan"), and the Developer would agree to develop all of the apartment units in the Project for occupancy of very low and lower income households and rent those units at an affordable housing cost; and WHEREAS, the Agency Loan Agreement will leverage the investment of the Agency by requiring the Developer to obtain additional financing for the construction and operation of the Project through such resources as Multifamily Housing Revenue Bonds and " 3% Tax Credits" to be generated by the Project; and WHEREAS, in accordance with California Health and Safety Code Section 33334.2 (g), staff is recommending that the CVRC find and determine that even though the Project is to be located outside the City's redevelopment project areas, those areas will benefit through the creation of jobs in the project area and elsewhere in the City by providing housing for persons who work within the City's redevelopment project areas, and through the policies served by dispersing affordable housing throughout the jurisdiction rather than clustering it all in one area; and WHEREAS, the Agency has adopted an Implementation Plan pursuant to Health and Safety Code Section 33490, which sets forth the objective of providing housing to satisfy the needs and desires of various age, income and ethnic groups of the community; and WHEREAS, the City has adopted a Housing Element of the General Plan which sets forth the objective of providing balanced and varied housing opportunities throughout the City to satisfy the needs and desires of various age, income and ethnic groups of the community, and vv~hich specifically provides for the construction of new affordable rental housing units through City assistance; and WHEREAS, on the 30th day of September, 2009, the City's Housing Advisory Commission, held a public meeting to consider said request for financial assistance; and WHEREAS, the Housing Advisory Commission, upon hearing and considering all testimony, if any, of all persons desiring to be heard, and considering all factors relating to the request for financial assistance, has recommended to the Agency that a loan be approved on the condition that al] other necessary financing be secured for the Project; and WHEREAS, on the 8~' day of October, 2009, the Chula Vista Redevelopment Corporation (CVRC), held a public meeting to consider said request for an Agency Loan; and CVRC Resolution No. 2009-009 Page 3 WHEREAS, the CVRC, upon hearing and considering all testimony, if any, of all persons desiring to be heard, and considering all factors relating to the request for an Agency Loan, has recommended to the Agency that a loan be conditionally approved subject to the Agency's approval of an affordable housing regulatory and loan agreement; and WHEREAS, the Environmental Review Coordinator reviewed the proposed Project for compliance with the California Environmental Quality Act (CEQA) and has determined that the proposed project was adequately covered in previously adopted Fina] Second Tier Environmental Impact Report, EIR 01-02. Thus, no further CEQA review or documentation is necessary. NOW. THEREFORE, THE CHULA VISTA REDEVELOPMENT CORPORATION does hereby recommend. that the Redevelopment Agency conditional approval of a loan in an amount not-to-exceed $4,000,000 from the Agency's Low and Moderate Income Housing Fund to Developer for the construction of the Project subject to the Agency s approval of an affordable housing regulatory and loan agreement and, at a minimum, the following terms and conditions: 1. Developer shall secure all other financing necessary for the acquisition and development of the Project. 2. Developer shall enter into a regulatory and loan agreement with the Agency to be considered at a later date by the Redevelopment Agency. The approval of this agreement remains subject to final approval by the Redevelopment Agency which retains its sole and unfettered discretion as to that decision. 3. The loan repayment will be secured by a Deed of Trust and Promissory Note for the property on behalf of the Redevelopment Agency of the City of Chula Vista and recorded against the Project property. 4. The term of the loan shall be twenty (20) years at 2% simple interest. 5. Developer will be required to operate the Project consistent with the Regulatory Agreement required by the Project's tax credit financing, and the Agency's Low/Mod financing, the covenants imposed by these Agreements, and any other Project requirements. 6. The Agency Loan is based upon the assumptions presented within the sources and uses of funds. development budget, development proforma and other information filed with the Affordable Housing Review Application for the Project as submitted and reviewed by the Development Services Department. The Agency assistance is a maximum level of participation. It is expected that any substantive revisions in such financing assumptions which would lead to an increase in other resources available, would therefore reduce the level of the Agency Loan. CVRC Resolution No. 2009-009 Paee 4 BE IT FURTHER RESOLVED THAT a copy of this Resolution be transmitted to the Redevelopment Agency. PRESENTED BY >% ~~ arv albe Deputy Cit, Manager/ Development Services Director APPROVED AS TO FORM BY ~ P B Mies d Agency ttgmey PASSED, APPROVED, and ADOPTED by the Chula Vista Redevelopment Corporation of the City of Chula Vista, this 8th day of October 2009, by the following vote: AYES: NAYS: ABSENT: ABSTAIN: ATTEST: Directors: Desrochers, Munoz, Paul, Rooney, Salas, and Lewis Directors: Reyes Directors: None Directors: None Enc C. Crockett, Secretary STATE OF CALIFORNIA COUNTY OF SAN DIEGO CITY OF CHULA VISTA Christophet~I3. Le G~~LaST ytr CVRC ~"~ y} m0 06/15/2005 C ~~ p0~ pdp~ ~Q- lp oooao° QO ~MENT C~~ I, Eric C. Crockett, Secretary of the Chula Vista Redevelopment Corporation of the City of Chula Vista, California, do hereby certify that the foregoing CVRC Resolution No. 2009-009 was duly passed, approved, and adopted by the Chula Vista Redevelopment Corporation at a special meeting of the Chula Vista Redevelopment Corporation held on the 8th day of October, 2009. Executed this 8th day of October, 2009. ~~ lam/ Eric C. Crockett, Secretary