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HomeMy WebLinkAbout1983-03-01; City Council; 7298; Commercial Rehabilitation Program. - CIT’, OF CARLSBAD - AGENDhelLL AB#* TITLE: DEPOSIT OF FUNDS FOR COWERCIAL DEPT. HD.w MTG.3/1/83 REHABILITATION PROGRAM ClTY Ad!!%i DEPT.RE CITY MG ” . I RECOMMENDED ACTION: Adopt Resolution No. q/qGauthorising the deposit of funds to the Bank of America for continued operation of the Commercial Rehabilitation Program. ITEM EXPLANATION: On April 6, 1982, City Council authorized the deposit of $55,000 to the Bank of America for use in the Commercial Rehabilitation Program. $37,000 of this money has been lent at low-interest to encourage commercial upgrading and economic development. On November 11, 1982, City Council authorized an additional $85,000 of Ninth Year Community Development Block Grant funds be allocated for this program. Staff is currently reviewing loan applications for these funds. The applicants are preparing to begin several projects in the downtown area. Staff is requesting authorization to deposit $85,000 in general fund monies for use in this program, The City will be reimbursed for these funds in July of 1983 when the Federal Community Development Block Grant funds are distributed. This is the same procedure used for previously allocated'Community Development Block Grant funds. I FISCAL IMPACT: The City will deposit the sum of $85,000 from the General Fund with the lending institution and request a lump sum drawdown from the County of San Diego to reimburse the General Fund. The City will be reimbursed for the full amount in July 1983 when the Federal program monies are released. EXHIBITS: I 1 - :lemo to Assistant City Manager/DS dated February 16, 1983. 2- Resolution No. 7/9G authorizing the deposit of $85,000 with the Bank of America, and approving a loan of $85,000 from the General Fund to the Community Block Grant fund. FEBRUARY 16, 1983 TO: ASSISTANT CITY MANAGER/DEVELOPMENTAL SERVICES VIA: Building and Planning Director FROM: Community Redevelopment Manager COMMERCIAL REHABILITATION PROGRAM PURPOSE: The purpose of a Commercial Rehabilitation Program is to encourage the improvement of existing commercial structures. The City does this by offering low-interest loans for this purpose. Owners and tenants of businesses in the target area may use this money to make their buildings more attractive and safe. Many cities have found that by providing this program they have been able to dress up and beautify their older commercial areas. (Carlsbad Target area, Census Tract 179.00) PROCESS: Owners and/or tenants of commercial structures in the target area can bring their projects to the City for consideration. The funds are primarily to be used for exterior improvements and code violations, A loan committee will make decisions as to the acceptability of applicants. A local lending agency will help the City in credit approval and research. The City will deposit funds with the lender for the purpose of making these loans. If a project is accepted and approved, the lender will make the loan to the applicant and the City's funds will be used to defray interest rates on the loan to an acceptable level. At this time 12% or 10% is the desired rate. The loan committee will periodically review and analyze the program and make adjustments as to the eligible improvements and the maximum amount per loan. Staff recommends that the loans be regulated to reach the maximum amount of applicants and have the widest impact on the area. Individual projects that the committee deems of major importance to the area may be granted special consideration. LOANS AND APPLICATIONS: To date the City has processed$37,000 in low-interest loans in the following manner: $12,000 - Antique Collective - to provide space and opportunity for 26 antique venders. 3 .- Y-y ASSISTANT CITY MANAGER/Da FEBRUARY 16, 1983 COMMERCIAL REHABILITATION PROGRAM PAGE 2 $25,000 - Poinsettia Plaza - To provide rehabilitation and face lift for approximately eight existing ,businesses. The following applications are being considered at this time: Greek Restaurant B & R Appliances Sportsman Bar - remodel of existing structure on westside of State Street to create restaurant/coffee shop. - Rehabilitation of burned appliance structure to office/professional suites. - Rehabilitation of structure to first floor commercial and second floor office building. Additionally, the new mid-block parking lot should generate new face lifts of the rear of adjacent commercial structures. COMMERCIAL REHABILITATION LOAN COMMITTEE: The Commercial Rehabilitation Loan Committee is the final review board for both commercial and residential loan applicants. It consists of four members selected from the community and city government and staff. This committee reviews applications as presented by staff and rule as to their acceptability and disposition. The Loan Committee is comprised of: 1. A lending institution representative. 2. The City's Director of Finance or his designee. 3. The City's Building and Planning Department head or his designee. 4. The Chairman of the Housing and Redevelopment Advisory Committee. The function of the loan committee will be to approve/disapprove all loan applications following their credit approval/disapproval by the lender. The committee must review and make disposition of all cases submitted. 3 ASSISTANT CITY MANAGER FEBRUARY 16, 1983 COWERCIAL REHAi3ILITATION PROGRAM PAGE 3 FUNDING: The funding for the Commercial Rehabilitation Program comes from the Federal Community Redevelopment Block Grant allocation, $33,000 from the fifth year allocation, $22,000 from the seventh year and $85,000 from the ninth year. These funds are leveraged through the Bank of America and as they are paid off become available for re-use. CHRIS SALOMONE h 1 2 3 4 5 6 7 6 9 1c 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 RESOLUTION NO, 7146 * AUTHORIZING THE DEPOSIT OF FUNDS FROM THE SELECTED REHABILITATION PROGRAM DEPOSITORY. WHEREAS, the City Council of the City of Carlsbad has authorized the use If Community Development Block Grant funds for the establishment of a local -ehabilitation program, and WHEREAS, the City of Carlsbad and the County of San Diego have'agreed to jrovide local rehabilitation services through the Community Development Block irant program, WHEREAS, the City of Carlsbad has selected a depository to ass'ist in the idministration of the rehabilitation program, and WHEREAS, the timely depositing of funds with the Bank of America depository rill guarantee rapid implementation of the local rehabilitation program, and WHEREAS, the City of Carlsbad desires to immediately loan $85,000 of General Fund monies to the Community Development Block Grant funds for deposit Irith the selected depository, this amount to be reimbursed in July 'I983 from ;he Block Grant fund; ‘/// ‘/// ‘/// I , ‘/I/ , I ‘/// ’ ‘/// ‘/// ‘/// ‘/// ‘/// _- I NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Carlsbad shall approve the loan of $85,000 of General Fund monies to the Community Development Block Grant fund and the deposit of these funds for the Rehabilitation Program with the Bank of America. PASSED, APPROVED AND ADOPTED at a regular meeting of the City Council of the City of Carlsbad on this 1st day of March 1983, by the following vote to wit: AYES: Council Eembers Casler, Lewis, Chick and Prescott NOES: None &&32NT : Council Member Kulchin iidct,7 d &y.&L MARY H.JCASLER, Mayor ATTEST: (Seal) . //// ///I