HomeMy WebLinkAbout1994-03-22; Housing & Redevelopment Commission; 246; Acquisition of Affordable Housing PropertyAB# dq’6 TITLE: APPROVAL OF REIMBURSEMENT AGREEMENT BETWEEN THE
CITY OF CARLSBAD AND CARLSBAD REDEVELOPMENT AGENCY
MTG. 3122194
DEPT. RED*
FOR ACQUISITION OF AFFORDABLE HOUSING PROPERTY
WITH COMMUNITY DEVELOPMENT BLOCK GRANT FUNDS
HOUSING AND-:EDEVELOPMENT COMMISi-JN -
RECOMMENDED ACTION:
I Adopt Resolution No. aq g approving the reimbursement agreement between the City
of Carlsbad and the Carlsbad Redevelopment Agency for acquisition of affordable
housing property with federal Community Development Block Grant Funds.
ITEM EXPLANATION:
On October 26, 1993, after making the required findings, the Agency agreed to assist in
providing interim financing in the amount of $2 million to acquire real property outside
the Village Redevelopment Area for the purposes of developing affordable housing for
persons/families within low and very low income households. Also on October 26th, the
City of Carlsbad agreed to reimburse the Redevelopment Agency for the interim financial
assistance when feasible and appropriate through the City’s Community Development
Block Grant (CDBG) Program.
On November 15, 1993, the City of Carlsbad acquired real property at 9156 El Camino
Real, through use of the Redevelopment Agency’s Low and Moderate Income Housing
Set-Aside funds for the purposes of developing the approved Villas at El Camino Real
Affordable Housing Project.
Prior to reimbursing the Redevelopment Agency as agreed through the use of CDBG
funds, the City was required to receive environmental clearance from the U.S
Department of Housing and Urban Development (HUD). On December 25, 1993, HUD
provided the clearance required to release $880,000 in previously allocated CDBG funds
for the purposes of fencing the acquisition of property for the Villas at El Camino Real
Affordable Housing Project.
Since the City must reimburse the Redevelopment Agency $2 million for the property
acquisition, an application for a Section 108 CDBG Loan was submitted to HUD on
January 27, 1994 to obtain the additional $1.2 million required to complete the
reimbursement transaction. The City’s Section 108 Loan application received approval
of the local HUD office in Los Angeles; it has been forwarded to HUD Headquarters in
Washington, D. C. for final review and approval. At this time, it is staff’s expectation
that the loan application will be approved by the end of March, 1994.
AB# =fjLis
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The agreement attached as Exhibit 2 is forwarded at this time to the Housing and
Redevelopment Commission for review. Staff is recommending that the Commission
approve this agreement to allow the City to reimburse the Redevelopment Agency, with
CDBG funds, in two (2) separate payments. The first payment will be made by April 30,
1994 and the second will be made as soon as the Section 108 loan funds are received by
the City from HUD. It is anticipated that the second payment shall be made to the
Redevelopment Agency no later than September 30, 1994.
FISCAL IMPACT:
The City will use approximately $800,000 in previously allocated CDBG funds and $1.2
million in Section 108 CDBG Loan funds to reimbursement the Carlsbad Redevelopment
Agency, in the total amount of $2 million, for property acquisition for affordable housing
purposes. Once reimbursed, the Redevelopment Agency will have funds available again
to assist in the development of affordable housing both inside and outside the Village
Redevelopment Area.
EXHIBITS:
l- Resolution No&approving reimbursement agreement between the City of
Carlsbad and Carlsbad Redevelopment Agency for acquisition of affordable
housing property with federal CDBG funds.
2- Reimbursement Agreement between City of Carlsbad and Carlsbad
Redevelopment Agency for acquisition of affordable housing property.
b
HOUSING AND REDEVELOPMENT COMMISSION RESOLUTION NO. 244
A RESOLUTION OF THE HOUSING AND REDEVELOPMENT
COMMISSION OF THE CITY OF CARLSBAD, CALIFORNIA
APPROVING THE REIMBURSEMENT AGREEMENT BETWEEN THE
CITY OF CARLSBAD AND THE CARLSBAD REDEVELOPMENT
AGENCY FOR ACQUISITION OF AFFORDABLE HOUSING PROPERTY
WITH FEDERAL COMMUNITY DEVELOPMENT BLOCK GRANT
FUNDS
WHEREAS, the City of Carlsbad has identified a need to provide at least 1400
housing units affordable to households of low and very low income by 1996; and
WHEREAS, on’october 26,1993, after making the required findings, the Carlsbad
Redevelopment Agency agreed to assist in providing interim financing in the amount of $2
million to acquire real property outside the Village Redevelopment Area for the purposes of
developing affordable housing for persons/families within low and very low income households;
and
WHEREAS, the City of Carlsbad acquired real property at 9156 El Camino Real,
through use of the Agency’s Low and Moderate Income Housing Set-Aside funds on November
15, 1993 for the purposes of developing the approved Villas at El Camino Real Affordable
Housing Project; and
WHEREAS, the City agreed to reimburse the Agency for the interim financial
assistance when feasible and appropriate through the City’s Community Development Block Grant
(CDBG) Program; and
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. . . .
WHEREAS, the U.S. Department of Housing and Urban Development has
provided the City with environmental clearance to release CDBG funds for the purposes of
financing the acquisition of property for the Villas at El Camino Real Affordable Housing
Project.
NOW, THEREFORE, BE IT HEREBY RESOLVED by the Housing
and Redevelopment Commission as follows:
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That the foregoing recitations are true and correct.
That the Carlsbad Redevelopment Agency shall be reimbursed by the City of
Carlsbad for two (2) million dollars in financial assistance provided through the
use of the Agency’s Low and Moderate Income Housing Set-Aside funds to
acquire a twenty-one (21) acre vacant parcel of property located adjacent to and
west of El Camino Real between Camino Vida Roble and Alga Road.
That the Carlsbad Redevelopment Agency shall be reimbursed by the City of
Carlsbad in two (2) payments from the City’s federal Community Development
Block Grant (CDBG) Program. The first reimbursement payment shall be made
with $800,000 in CDBG funds previously allocated for affordable housing
property acquisition. The Agency shall accept the second reimbursement payment
from the City through use of funds from a $1.2 million Section 108 CDBG Loan.
That the Redevelopment Agency’s Finance Director is authorized to deposit the
reimbursement payments from the CDBG funds into the Carlsbad Redevelopment
Agency’s Low and Moderate Income Housing Fund upon receipt from the City.
The first payment shall be deposited no later than April 30, 1994.
That the City of Carlsbad shall use the subject property for a rental housing
project which will provide 344 units of housing affordable to households of low
and very low income as approved by the City Council on October 26, 1993.
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6. That the Carlsbad Redevelopment Agency’s Executive Director is authorized to
execute the reimbursement agreement with the City of Carlsbad and any other
documents which may be related to the transaction of funds outlined within this
resolution.
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6 PASSED, APPROVED, AND ADOPTED at a regular meeting of the Housing
7 and Redevelopment Commission of Carlsbad, California, held on the 77~ day of MARCH
8 -9 1994 by the following vote, to wit:
9 AYES: Commission Members Lewis, Stanton, Nygaard, Finnila
10 NOES: None
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12 ABSENT: Commissioner Kulchin
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ABSTAIN: None
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EXHIBIT 2
REIMBURSEMENT AGREEMENT BETWEEN THE CITY OF CARLSBAD
ANDCARLSBADREDEVELOPMENTAGENCY
FOR ACQUISITION OF AFFORDABLE HOUSING PROPERTY
FEDERAL COMMUNITY DEVELOPMENT BLOCK GRANT FUNDS
THIS AGREEMENT, made and entered into as of this -@+ day of c- //l ,LLC,L/ , 19z&y and between the CITY OF CARLSBAD, a municipal
corporation, hereinafter referred to as “City”, and CARLSBAD REDEVELOPMENT
AGENCY, a Community Redevelopment Agency organized and existing under
Community Redevelopment Law, Health and Safety Code Section 33000, et.seq.,
hereinafter referred to as “Agency”.
RECITALS
WHEREAS, the City has the need to provide at least 1400 units of affordable
housing for low and very low income families within Carlsbad; and,
WHEREAS, on October 26, 1993, after making the required findings, the Agency
agreed to assist in providing interim financing in the amount of $2 million to acquire real
property outside the Redevelopment Area for the purposes of developing affordable
housing for persons/ families within low and very low income households; and,
WHEREAS, the City acquired real property at 9156 El Camino Real, through use
of the Agency’s Low and Moderate Income Housing Set-Aside funds, on November 15,
1993 for the purposes of developing the approved Villas at El Camino Real Affordable
Housing Project; and,
WHEREAS, the City agreed to reimburse the Agency for the interim financial
assistance when feasible and appropriate through the City’s Community Development
Block Grant (CDBG) Program; and,
WHEREAS, the U.S. Department of Housing and Urban Development has
provided the City with environmental clearance to release CDBG funds for the purposes
of financing the acquisition of property for the Villas at El Camino Real Affordable
Housing project.
NOW, THEREFORE, in consideration of these recitals and the mutual covenants
contained herein, City and Agency agree as follows:
1. STATEMENT OF WORK
The City shall reimburse the Agency for two (2) million dollars in financial
assistance provided through the use of the Agency’s Low and Moderate Income
Housing Set-Aside funds to acquire a twenty-one (21) acre vacant parcel of
property located adjacent to and west of El Camino Real between Camino Vida
Roble and Alga Road. The property acquisition price was based on two (2) third
party, formal appraisals. The parcel number for the subject property is 215-020-l 5
and the street address is 9156 El Camino Real within the city limits of Carlsbad.
The City shall reimburse the Agency for the entire two (2) million dollars provided
to finance acquisition of said property. The reimbursement shall be made with
eight hundred thousand dollars ($800,000) in CDBG funds previously allocated
specifically for the acquisition of property for affordable housing purposes. In
addition, the City shall use funds from a $1.2 million Section 108 CDBG Loan to
complete the reimbursement transaction outlined within this agreement.
The subject property shall be used by the City for a rental housing project which
will provide 344 units of housing affordable to households of low and very low
income. As approved by the City on October 26, 1993, the subject affordable
housing project includes one, two, and three bedroom apartment units with rents
affordable to households at 50% to 60% of the San Diego County Median.
The City shall work with the development team for the subject project to produce
said affordable housing units. The development team includes Hillman Properties
(private local developer), BRIDGE Housing Corporation (private non-profit
affordable housing developer), and Kruer/Picerne Partnership (private local
developer/builder).
The City shall enter into an agreement to lease the subject property to the
BRIDGE Housing Corporation for development of the identified affordable housing
p!oject.
Every effort shall be made by the City to provide full reimbursement to the Agency
for acquisition funds for the subject property by September 30, 1994. If the City
will be unable to fully reimburse the Agency by the noted date, the City shall
request an extension of this reimbursement agreement.
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2. SCHEDULE OF PAYMENTS
The City shall make two (2) lump sum payments for reimbursement to the
Agency. The first reimbursement payment in the amount of $800,000 shall be
made no later than April 30, 1994. The second reimbursement payment in the
amount of $1.2 million shall be made no later than September 30, 1994. The
funds used to make said reimbursement payments shall be drawn down from the
City’s Letter of Credit with the United States Department of Housing and Urban
Development (HUD) as appropriate and consistent with federal regulations for the
CDBG Program.
3. RECORDS AND REPORTS
The City shall maintain all appropriate records to account for the expenditure of
the federal CDBG funds, including the Section 108 CDBG Loan funds, to
reimburse the Agency for property acquisition as outlined within this agreement.
The Federal Grantor Agency, Comptroller General of the United States, or any of
their duly-authorized representatives shall have access to all books, documents,
papers and records maintained by the City which directly pertain to the above
project for the purpose of audit, examination, excerpts and transcriptions.
Unless otherwise notified by HUD, the City shall retain all financial records,
supporting documents and statistical reports related to the project identified under
this agreement until September 30, 1997. All records subject to an audit finding
shall be retained for three (3) years from the date the finding is made or until the
finding has been cleared by appropriate officials and the City has been given
official written notice.
As required by the Federal Single Audit Act, the City shall be required to have a
comprehensive financial audit prepared by an independent, neutral third-party
auditor for the use of CDBG funds. The audit shall cover financial operations of
the City’s CDBG program for the period beginning July 1, 1993 and ending June
30, 1994. The City shall also ensure that an audit is completed for the period
covered under fiscal year beginning July 1, 1994 and ending June 30, 1995 for
any reimbursement funds paid after June 30, 1994.
4. PROGRAM REQUIREMENTS
The City will adhere to the terms of the City’s CDBG and Section 108 Loan
application and with assurances and agreements made to the United States
Department of HUD.
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The City shall comply with applicable Uniform Administrative Requirements as
described in Section 570.502 of the federal regulations for the CDBG Program;
the federal requirements are set forth, by reference, as a provision of this
agreement.
The City shall carry out all activities in compliance with all Federal laws and
regulations as described in Subpart K, such as labor standards and fair housing
requirements.
The provisions of Subpart K, of the CDBG Program Regulations, are set forth, by
reference, as a condition of this reimbursement agreement.
5. CHANGES IN USE OF FUNDS
This agreement allows the City to reimburse the Agency for interim financial
assistance provided to acquire property for the purpose of developing the
identified affordable housing project only. No other use of said funds is permitted
without proper public review and City action.
6. NONDISCRIMINATION CLAUSE
The City shall comply with all state and federal laws regarding nondiscrimination
in the provision of services and the equal opportunity employment of personnel.
7. SUSPENSION AND TERMINATION OF AGREEMENT
In accordance with Section 24, Parts 85.43 and 85.44 of the Code of Federal
Regulations, this agreement may be suspended or terminated if either party fails
to comply with any term(s) set forth herein. Section 24, Parts 85.43 and 85.44 of
the Code of Federal Regulations are set forth, by reference, as provisions of this
agreement.
8. REVERSION OF ASSETS
The subject property shall be required to be used for the identified affordable
housing project and/or an alternate CDBG eligible project, as approved by City,
for a minimum of five (5) years. If the property is not used for the identified or
other eligible project for a minimum of five (5) years, it must be disposed of in a
manner that results in the federal government being reimbursed in the full amount
of the current market value of the property less any portion of the value
attributable to expenditures of non-CDBG funds for acquisition of, or improvement
to, the property.
9. ASSIGNMENT OF AGREEMENT
The Agency shall not assign this agreement or any monies due thereunder
without the prior written consent of the City.
10. SUCCESSORS OR ASSIGNS
Subject to the provisions of this Agreement, all terms, conditions, and provisions
hereof shall insure to and shall bind each of the parties hereto, and each of their
respective, executors, administrators, successors, and assigns.
IN WITNESS WHEREOF the parties hereto have caused this agreement to be
executed as of the day and year first written above.
CARLSBAD REDEVELOPMENT AGENCY, a Community Redevelopment Agency of
e State of California
ATTEST:
RANZ CITY CLERK KAREN R. KUNDTZ, ant'city Clerk
APPROVED AS TO FORM:
RON BALL, CITY ATTORNEY 3/,3 /5-H
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