HomeMy WebLinkAbout2002-11-12; City Council; 16973; Calavera Hills Pase II Affordable ApartmentsCITY OF CARLSBAD -AGENDA BILL 8 ,!3
LB# 16.973 DEPT. HD. m: DECLARATION OF INTENT TO ISSUE $8.5 MILLION
IN TAX EXEMPT PRIVATE ACTIVITY BONDS FOR THE
APARTMENT UNITS WITHIN THE CALAVERA HILLS PHASE II
ITG. 11-12-02 CITY ATTY. CONSTRUCTION OF ONE HUNDRED SIX (106) AFFORDABLE
IEPT. HlRED CITY MGR. MASTER PLAN
RECOMMENDED ACTION:
That the City Council take the following actions: 1) ACCEPT public comment on the Council’s declaration
of intent to issue tax-exempt private activity bonds in an amount not to exceed $8.5 million to finance the
construction of one hundred six (106) affordable apartment units within the Calavera Hills Phase II Master
Plan: and 2) ADOPT Council Resolution No. 2002-334 , APPROVING the Council’s
declaration of intent to issue the subject tax exempt bonds.
ITEM EXPLANATION:
Backaround
The Mariposa Apartments are a 106-unit development located on the west side of the future extension of
College Boulevard, approximately % mile south of Carlsbad Village Drive, in what is known as Village Y of
the Calavera Hills Master Plan Phase II. The project is being developed by Chelsea Investment
Corporation of Solana Beach and will satisfy the affordable housing requirement for the Calavera Hills
be affordable to households earning 20% of the State Median Income (SMI) and 22 units at levels
Phase II Master Plan. The project includes one, two and three bedroom units. Of the 106 units, 10 units will
affordable to households earning 30% of SMI (SMI is approximately 1% higher than the San Diego County
Area Median Income). The remainder of the project, 74 units, will be affordable to household earning 60%
of the San Diego County Area Median Income.
On September 10, 2002, the City Council approved the Site Development Plan for the development of the
affordable apartments. On October 15, 2002, the City Council took several actions related to the financing
of the project. First, the City Council approved a loan to the developer in the amount of $1,060,000 from
the Housing Trust Fund. The City Council also adopted a resolution expressing the City’s intent to issue
tax-exempt multi-family revenue bonds in an amount not to exceed $8.5 million to assist in financing the
subject project. In addition, the City Council authorized staff to apply to the California Debt Limit Allocation
Committee (CDLAC) to receive an allocation for the issuance of the tax-exempt bonds.
Tax Exempt Bond Allocation
Prior to any action to authorize issuance of the tax-exempt bonds, the Internal Revenue Code requires the
City to hold a public hearing to accept comments on the City’s intent to issue the bonds. At this time, staff
and the Developer are requesting that the Council hold the public hearing to accept comments on the
forth the City’s intent to issue bonds. The resolution, however, does not obligate the City to issue bonds for City’s intent to issue the tax exempt bonds for the subject project. Approval of the attached resolution sets
the project. Once the City has been granted a bond allocation from CDLAC, the Council will be required to
adopt a “Bond Resolution” authorizing the actual sale and issuance of the bonds. Action to authorize
issuance of the bonds will most likely be requested in March 2003.
ENVIRONMENTAL REVIEW
A Negative Declaration was approved by the City Council for the Site Development Plan (SDP 01-05) on
September IO, 2002. No further environmental review is required as part of the approval of the subject
bond issuance.
AB # 16,973
Page 2
FISCAL IMPACT
The Council is being asked to take action to declare the City’s intent to issue tax-exempt bonds in an
apartment units within the Calavera Hills Phase II Master Plan. The bond issue will be structured to pay
amount not to exceed $8.5 million to finance the construction of one hundred six (106) affordable
down the bonds as equity funds are paid in to the development. Once project construction is complete, the
bonds will be paid down to approximately $5.5 million, and repaid over a 30-year period. To date, the
applicant has made a deposit of $20,000 to cover staff costs, and the costs of the City’s financial advisor.
issuance not covered by the deposit (staff costs, bond counsel, underwriting, financial advisor, etc.) will be
If the City Council takes action at a later date to authorize issuance of the bonds, the costs associated with
fully recovered from the proceeds of the bond issuance. It is also important to note that the entire legal
obligation to repay the bonds rests with the Developer. Therefore, there will be no fiscal impact to the City
resulting from the issuance of the bonds.
EXHIBITS
1. City Council Resolution No. 2002-334 approving the City’s intent to issue tax exempt private
activity bonds in an amount not to exceed $8.5 million.
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CITY COUNCIL RESOLUTION NO. 2002-334
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
EXEMPT OBLIGATIONS IN AN AMOUNT NOT TO EXCEED $8.5
MILLION TO FINANCE THE CONSTRUCTION OF ONE HUNDRED
SIX (106) AFFORDABLE APARTMENT UNITS WITHIN VILLAGE Y
OF THE CALAVERA HILLS PHASE I1 MASTER PLAN AND
DIRECTING CERTAIN ACTIONS
APPLICANT: CHELSEA INVESTMENT CORPORATION
CASE NO: SDP 01-05
CARLSBAD, CALIFORNIA, APPROVING THE ISSUANCE OF TAX-
WHEREAS, the City of Carlsbad (the "City") intends to issue tax-exempt obligations
(the "Obligations") for the purpose, among other things, of making a loan to Chelsea Investment
Corporation ("Chelsea") or a limited partnership or limited liability company to be established
by Chelsea (the "Developer"), the proceeds of which shall be used by the Developer to finance
the acquisition, construction and development of a multifamily housing rental facility to be
located on the west side of the future extension of College Boulevard, approximately % mile
south of Carlsbad Village Drive in the City of Carlsbad, California (the "Project"); and
WHEREAS, the City is authorized by Chapter 7 of Part 5 of Division 31 of the Health
and Safety Code of the State of California (the "Law") to issue and sell revenue bonds for the
purpose of financing the acquisition, construction and development of multifamily rental housing
facilities to be occupied in part by low and very low income tenants; and
WHEREAS, the Obligations will be considered to be "qualified exempt facility bonds"
under Section 142(a) of the Internal Revenue Code of 1986, as amended (the "Code"), and
Section 147(f) of the Code requires that the "applicable elected representative" with respect to
the City hold a public hearing on and approve the issuance of the Obligations; and
WHEREAS, this City Council is the elected legislative body of the City; and
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CC Resolution No. 2002-334
has been published, to the effect that a public hearing would be held by this City Council on the
date hereof regarding the issuance of the Obligations by the City and the nature and location of
the Project; and
WHEREAS, this City Council held said public hearing, at which time an opportunity was
provided to present arguments both for and against the issuance of such Bonds and the nature and
location of the Project; and
WHEREAS, it is in the public interest and for the public benefit that the City approve the
issuance and delivery of the Obligations for the purpose of financing the acquisition, construction
and development of the Project; and
WHEREAS, the City shall not have any liability for the repayment of the Obligations or
any responsibility for the Project;
NOW, THEREFORE, BE IT HEREBY RESOLVED by the City Council of the City
of Carlsbad, California, as follows:
1. The City hereby finds and determines that the foregoing recitals are true and correct.
2. The City hereby approves the issuance and delivery of the Obligations for the purpose
of paying the costs of financing the acquisition, construction and development of the Project,
subject to the review and approval of the documents to be executed and delivered in connection
with the Obligations.
11 3. This resolution shall take effect upon its adoption.
Ill
Ill
Ill
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PASSED, APPROVED, AND ADOPTED at a regular meeting of the City
Council of the City of Carlsbad, California, held on the 12" day of November, 2002, by
the following vote, to wit:
AYES: Council Members Lewis, Kulchin, Finnila, Nygaard, Hall
NOES: None
ABSENT: None
ABSTAIN: None
ATTEST:
(SEAL,)
CC ResolutionNo. 2002-334
Page 3
PPROOF OF PUBLICATION
(2010 & 2011 C.C.P.)
This space is for the County Clerk's Filing Stamp
STATE OF CALIFORNIA
County of San Diego
I am a citizen of the United States and a resident of
the County aforesaid I am over the age of eighteen
years and not a party to or interested in the
above-entitled matter. I am the principal clerk of
the printer of
North County Times Proof of Publication of
Formerly known as the Blade-Citizen and The
Times-Advocate and which newspapers have been
adjudicated newspapers of general circulation by
the Superior Court of the County of San Diego,
State of California, for the County of San I:
that the notice of which the annexed is a PI OF PUBLIC NTzuuNG
been published in each
said newspaper and not in on the following dates, to-wit:
OCTOBER 22, 2002
I certify (or declare) under penalty of perjuq The'owner of !he Projyt is e ected to be'the Chelsea Investment
the foregoing is true and correct. I Co orahon ( Chelsea ) or a%ited ' artnershp or hmlted lia&ty to be established by Chelseaythe "Owner").
Dated
this -
at
of
.SAN MARCOS-
22ND
Calif( are invited to attend 'be beard at the meetmg whch wll All those interested in npters related tothe $suance. of the Bonds
cdmmence at.or after%hqrn: and will be held at City Council Chambers, 1200 Carlsbad illage,Drive, Carlsbad, Callfomia 92008. If you have an queshons re ardmg the ubltc hearmg, please con-
~ tact Mr. Craig I7 uiz, City of 8 Flsbad, (7 &. ) 434-2817 .
. OCTOBER, 2002 IDAm 6tober 16,2002
ANICE BREITENFELD uty qty Clerk
PUBLrSH TUESDAY, OCTOBER . ,. 22,2002
-I I
,.
.- ,, , . ..
Signature
NORTH COUNTY TIMES
Legal Advertising
NOTICE OF PUBLIC HEARING
NOTICE IS HEREBY GIVEN that the City Council of the City of Carlsbad
(the "City"), at its regular meeting on November 12, 2002, will hold a public
hearing and consider approval of the issuance by the City of tax-exempt
multifamily revenue bonds in an estimated amount of Eight Million Five Hundred
Thousand Dollars ($8,500,000) (the "Bonds"), the proceeds of which will be used
to assist in the financing of the acquisition, construction and development of a
106-unit multifamily housing residential facility to be located on the west side of
the future extension of College Boulevard, approximately '/4 mile south of
Carlsbad Village Drive in the City of Carlsbad, California.
The owner of the Project is expected to be the Chelsea Investment
Corporation ("Chelsea") or a limited partnership or limited liability to be
established by Chelsea (the "Owner").
All those interested in matters related to the issuance of the Bonds are
invited to attend and be heard at the meeting which will commence at or after
6:OO p.m. and will be held at City Council Chambers, 1200 Carlsbad Village
Drive, Carlsbad, California 92008. If you have any questions regarding the public
hearing, please contact Mr. Craig Ruiz, City of Carlsbad, (760) 434-2817.
DATED: October 16,2002
By:
//ANICE BREITENFE~
Deputy City Clerk
PUBLISH: TUESDAY, OCTOBER 22,2002