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HomeMy WebLinkAbout75D - PH TAX EXEMPT BONDSREQUEST FOR COUNCIL ACTION CITY COUNCIL MEETING DATE: SEPTEMBER 4, 2018 TITLE: PUBLIC HEARING ON ISSUANCE OF TAX EXEMPT BONDS FOR THE BENEFIT OF THE CHRISTIAN AND MISSIONARY ALLIANCE, AND RESOLUTION APPROVING THE ISSUANCE OF BONDS (STRATEGIC PLAN NO. 5,3) Cl*MANAGER APPLICANT REQUESTED ACTION CLERK OF COUNCIL USE ONLY: ❑ As Recommended ❑ As Amended ❑ Ordinance on 1s' Reading ❑ Ordinance on 2nd Reading ❑ Implementing Resolution ❑ Set Public Hearing For CONTINUED TO FILE NUMBER 1. Conduct a Tax Equity and Financial Responsibility Act (TEFRA) Hearing in consideration of the issuance of tax exempt bond financing by the California Municipal Finance Authority (the "Authority') on behalf of Town and Country Manor of the Christian and Missionary Alliance (the "Borrower'), for the benefit of Town and Country Manor (the "Project") for the acquisition, construction, improvement and equipping of certain retirement, nursing, assisted living and parking facilities of the continuing care retirement community owned and operated by the Borrower, located at 555 East Memory Lane, Santa Ana, California 92706. 2. Adopt a resolution approving the issuance of revenue bonds by the Authority in an amount not to exceed $45,000,000 for the acquisition, construction, improvement and equipping of certain retirement, nursing, assisted living and parking facilities of the continuing care retirement community owned and operated by the Borrower, located at 555 East Memory Lane, Santa Ana, California 92706. Town and Country Manor of the Christian and Missionary Alliance, a nonprofit public benefit corporation organized and existing under the laws of the State of California and an organization described in Section 501(c)(3) of the Internal Revenue Code of 1986 (the "Borrower"), has requested that the California Municipal Finance Authority (the "CMFA") issue and sell revenue bonds in an aggregate principal amount not to exceed $45,000,000 (the "Bonds") for the purpose of making a loan to the Borrower to enable the Borrower to finance and refinance the acquisition, construction, improvement and equipping of certain retirement, nursing, assisted living and parking facilities of the continuing care retirement community owned and operated by the Borrower, located at 555 East Memory Lane, Santa Ana, California 92706. 7513-1 TEFRA Hearing —Town and Country Manor September 4, 2018 Page 2 Specifically, Town and Country Manor is proposing to construct a two-story, 48 -bed assisted living/memory care facility on their existing campus. This project will replace an eight -story, 156 - unit active senior apartment building that was entitled in 2014 but is no longer being pursued by the owner. The project is currently in development review and is almost ready to complete the review process. As the project is a permitted use within the zoning district, no discretionary approval by the City is needed. However, in order for all or a portion of the Bonds to qualify as tax-exempt bonds, a governmental unit having jurisdiction over the area in which the Project is located must conduct a public hearing (the "TEFRA Hearing") providing for the members of the community an opportunity to speak in favor of or against the use of tax-exempt bonds for the refinancing of the Project. Following the close of the TEFRA Hearing, an "applicable elected representative" of the govemmental unit hosting the Project, in this case the City, must provide its approval of the issuance of the Bonds by the Authority for the financing of the Project. The bonds to be issued by the CMFA are the sole responsibility of the borrower. The City has no financial or legal liability for the project or repayment of the bonds and does not constitute any type of indebtedness for the City. In addition, this TEFRA Hearing and the adoption of the Resolution shall not obligate the City or any department thereof to: (i) provide any financing to acquire or construct the Project or any refinancing of the Project; (ii) approve any application or request for or take any other action in connection with any planning approval, permit or other action necessary for the acquisition, construction, rehabilitation, installation or operation of the Project; (iii) make any contribution or advance any funds whatsoever to the Authority; or (iv) take any further action with respect to the Authority or its membership therein. In general, this action by the City of Santa Ana will not obligate the City or any department thereof to undertake any discretionary action related to the development of the project. The Housing Element of the City's General Plan contains various goals and policies which are intended to provide a diversity of quality housing, affordability levels and living experiences that accommodate Santa Ana's residents to foster an inclusive community. Additionally, the General Plan encourages development of affordable rental and ownership housing for seniors, people with disabilities, families with children, and people needing emergency, transitional or supportive housing options. STRATEGIC PLAN ALIGNMENT Approval of this item supports the City's efforts to meet Goal # 5 - Community Health, Livability, Engagement & Sustainability, Objective # 3 (Facilitate diverse housing opportunities and support efforts to preserve and improve the livability of Santa Ana neighborhoods). FISCAL IMPACT The Board of Directors of the California Foundation for Stronger Communities, a California non- profit public benefit corporation (the "Foundation"), acts as the Board of Directors for the California Municipal Finance Authority (CMFA). Through its conduit issuance activities, the CMFA shares a 75D-2 TEFRA Hearing — Town and Country Manor September 4, 2018 Page 3 portion of the issuance fees it receives with its member communities and donates a portion of these issuance fees to the Foundation for the support of local charities. With respect to the City of Santa Ana, it is expected that 25 percent of the issuance fee will be granted by the CMFA to the general fund of the City. Such grant may be used for any lawful purpose of the City. The CMFA does not receive issuance fees until a bond issuance closes. The fees the CMFA receives are based upon the par amount of the bonds issued. The Borrower ultimately decides when and if the bonds are actually issued and the final amount of bonds issued. The amount granted to the City is to be determined but will not exceed $12,500 under the assumption the entire $45,000,000 in bonds are issued. Upon receipt, the funds will be deposited to the Miscellaneous Revenues, Miscellaneous Recoveries Revenue Account (no. 01102002-57010). Steven A. Mendoza oz Executive Director Community Development Agency Exhibits: 1. Resolution 2. Notice to Applicant APPROVED AS TO FUNDS AND ACCOUNTS: Sergio Vidal s,¢, Acting Executive Director Finance and Management Services Agency 75D-3 75D-4 EXHIBIT 1 RESOLUTION NO. 20184 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA ANA APPROVING THE ISSUANCE OF REVENUE BONDS BY THE CALIFORNIA MUNICIPAL FINANCE AUTHORITY FOR THE PURPOSE OF FINANCING AND REFINANCING THE ACQUISITION, CONSTRUCTION, IMPROVEMENT AND EQUIPPING OF CERTAIN FACILITIES OF A CONTINUING CARE RETIREMENT COMMUNITY OWNED AND OPERATED BY TOWN AND COUNTRY MANOR OF THE CHRISTIAN AND MISSIONARY ALLIANCE LOCATED AT 555 EAST MEMORY LANE, SANTA ANA, AND CERTAIN OTHER MATTERS PERTAINING THERETO BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SANTA ANA, AS FOLLOWS: Section 1. The City Council of the City of Santa Ana hereby finds, determines and declares as follows: A. Pursuant to Chapter 5 of Division 7 of Title 1 of the Government Code of the State of California (the "Act"), certain public agencies (the "Members") have entered into a Joint Exercise of Powers Agreement Relating to the California Municipal Finance Authority dated as of January 1, 2004 (the "Agreement") in order to form the California Municipal Finance Authority (the "CMFA:'), for the purpose of promoting economic, cultural and community development, and in order to exercise any powers common to the Members, including the issuance of bonds, notes or other evidences of indebtedness. B. The City of Santa Ana, California (the "Citta') is a Member of the CMFA. C. Town and Country Manor of The Christian and Missionary Alliance, a nonprofit public benefit corporation organized and existing under the laws of the State of California and an organization described in Section 501(c)(3) of the Internal Revenue Code of 1986 (the "Borrower"), has requested that the CMFA issue and sell revenue bonds in an aggregate principal amount not to exceed $45,000,000 (the "Bonds") for the purpose of making a loan to the Borrower to enable the Borrower to finance and refinance the acquisition, construction, improvement and equipping of certain retirement, nursing, assisted living and parking facilities of the continuing care retirement community owned and operated by the Borrower, located at 555 East Memory Lane, Santa Ana, California 92706 (the "Project"). D. In order for the interest on the Bonds to be tax-exempt, Section 147(f) of the Internal Revenue Code of 1986, as amended (the "Code"), requires that an "applicable elected representative" of the governmental unit, the geographic jurisdiction of which contains the site of facilities to be financed and refinanced with the proceeds of the Bonds, hold a public hearing on the issuance of the Bonds and approve the issuance of the Bonds following such hearing. E. The CMFA has determined that the City Council can be the "applicable elected representatives" for purposes of holding such public hearing. Resolution No. 2018-[_1 Page 1 of 3 75D-5 EXHIBIT 1 F. The CMFA has requested that the City Council approve the issuance of the Bonds by the CMFA in order to satisfy the public approval requirement of Section 147(f) of the Code, and the requirements of Section 4 of the Agreement. G. Notice of such public hearing has been duly given as required by the Code, and this City Council has heretofore held such public hearing at which all interested persons were given an opportunity to be heard on all matters relative to the financing or refinancing of the Project and the CMFA's issuance of the Bonds therefor. H. It is in the public interest and there are significant public benefits from the issuance of the Bonds for the financing and refinancing of the Project. Section 2. The City Council hereby approves the issuance of the Bonds by the CMFA and finds the Project will create the significant public benefits set forth in foregoing recitals. It is the purpose and intent of the City Council that this resolution constitute approval of the issuance of the Bonds (a) by an "applicable elected representative" of the governmental unit having jurisdiction over the area in which the Project is located in accordance with Section 147(f) of the Code; and (b) by the City Council in accordance with Section 4 of the Agreement. Section 3. The issuance of the Bonds shall be subject to approval by the CMFA of all financing documents relating thereto to which the CMFA is a party. The City shall have no responsibility or liability whatsoever with respect to the Bonds. Section 4. The adoption of this Resolution shall not obligate the City or any department thereof to (i) provide any financing to acquire or construct the Project or any refinancing of the Project; (ii) approve any application or request for or take any other action in connection with any planning approval, permit or other action necessary for the acquisition, construction, improvement and equipping or operation of the Project; (iii) make any contribution or advance any funds whatsoever to the CMFA; or (iv) take any further action with respect to the CMFA or its membership therein. Section 5. The executing officer(s), the Clerk of the Council and all other proper officers and officials of the City are hereby authorized and directed to execute such other agreements, documents and certificates, and to perform such other acts and deeds, as may be necessary to effect the purposes of this Resolution and the transactions herein authorized. Section 6. The Clerk shall forward a certified copy of this Resolution to the CMFA in care of its counsel: Ronald E. Lee, Esq. Jones Hall, a Professional Law Corporation 475 Sansome Street, Suite 1700 San Francisco, CA 94111 Section 7. This resolution shall take effect immediately upon its passage. Resolution No. 2018-[ Page 2 of 3 75D-6 EXHIBIT 1 ADOPTED this [_] day of [ ], 2018. Miguel A. Pulido Mayor APPROVED AS TO FORM: Sonia R. Carvalho City Attorney By: Ry O. Wdge Assistant City Attorney YES: Councilmembers: NOES: Councilmembers: ABSTAIN: Councilmembers: NOT PRESENT: Councilmembers: CERTIFICATION OF ATTESTATION AND ORIGINALITY I, Maria D. Huizar, Clerk of Council, do hereby attest to and certify the attached Resolution No. 2018-[I to be the original resolution adopted by the City Council of the City of Santa Ana on [ 1, 2018. Date: [ j, 2018 4150-8103-7589.5 Clerk of Council City of Santa Ana 75D-7 Resolution No. 2018-[ Page 3 of 3 75D-8 MAYOR Miguel A. Pulido MAYOR PRO TEM Michele Martinez COUNCILMEMBERS P. David Benavides Vicente Sarmiento Jose Solorio Sal Tinajero Juan Villegas August 8, 2018 CITY OF SANTA ANA 20 Civic Center Plaza . P.O. Box 1988 Santa Ana, California 92702 www.santa-ana.ora Dirk DeWolfe, Executive Director Town and Country Manor 555 East Memory Lane Santa Ana, CA 92706 Subject: Notice to Applicant Regarding Request for TEFRA Hearing Dear Mr. DeWolfe, CITY MANAGER Raul Godinez II CITY ATTORNEY Sonia R. Carvalho CLERK OF THE COUNCIL Maria D. Huizar SENT VL4 E-MAIL This is in response to your request for the City of Santa Ana to conduct a Tax Equity and Fiscal Responsibility Act (TEFRA) Hearing in consideration of the issuance of tax exempt bond financing by the California Municipal Finance Authority on behalf of Town and Country Manor of the Christian and Missionary Alliance, for the benefit of Town and Country Manor for the acquisition, construction, improvement and equipping of certain retirement, nursing, assisted living and parking facilities of the continuing care retirement community located at 555 East Memory Lane, Santa Ana, California 92706. The TEFRA Hearing has been placed on our City Council agenda for September 4, 2018 per your request. This TEFRA Hearing is not being considered by City Council as a recommended action per our staff. Instead this item is being considered as an applicant requested action. In addition, this TEFRA Hearing and the adoption of the Resolution shall not obligate the City or any department thereof to (i) provide any financing to acquire or construct the Project or any refinancing of the Project; (ii) approve any application or request for or take any other action in connection with any planning approval, permit or other action necessary for the acquisition, construction, rehabilitation, installation or operation of the Project; (iii) make any contribution or advance any funds whatsoever to the Authority; or (iv) take any further action with respect to the Authority or its membership therein. In general, this action by the City of Santa Ana will not obligate the City or any department thereof to undertake any discretionary action related to the development of your project. If you have any questions regarding this notice, I may be reached by telephone at (714) 667-2241 or by e- mail at ibrown(a)santa-ana.or¢. Sincerely, Judson Brown Housing Division Manager SANTA ANA CITY COUNCIL Mguel a Pulido Michele Martinez Vicente Sameento Jose Solaria P. David eenavides Juan Villages Sal Tinajero Mayor Mayor Pro Tem, Ward 2 Ward 7 Wald 3 Ward 4 Ward 5 Ward 6 moulido(alsanla-anacra nhaarlinezidsanta-ana.ora vsarmlento(alsanta-anaom olorlobanao dhenavldesAsantaana.ora villeaa 0sanla-ana.om sfinalemAsanla-ma.am 75D-10