HomeMy WebLinkAbout05 - ResoAuthIssuMFHsgRevBondsCityGardAptsREQUEST FOR HOUSING
AUTHORITY ACTION
MEETING DATE:
NOVEMBER 20, 2006
TITLE
RESOLUTION AUTHORIZING THE
ISSUANCE OF MULTI -FAMILY HOUSING
REVENUE BONDS - CITY GARDENS
APARTMENTS
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4.
EXECUTIVIE DIRECTOR
RECOMMENDED ACTION
RECORDING SECRETARY USE ONLY:
APPROVED
❑ As Recommended
❑ As Amended
CONTINUED TO
Adopt a resolution authorizing the issuance of tax-exempt, multi --family
housing revenue refunding bonds in an amount not to exceed $8,400,000 for
City Gardens Apartments and authorize the Chairperson, Vice -Chairperson
or Executive Director of the Housing Authority or their designee to
execute all documents as necessary.
COMMUNITY REDEVELOPMENT AND HOUSING COMMISSION RECOMMENDATION
Recommended that the Housing Authority adopt a resolution approving the
issuance of tax-exempt, multi -family housing revenue refunding bonds in
an amount not to exceed $8,400,000 for City Gardens Apartments and
authorize the Chairperson, Vice -Chairperson or Executive Director of the
Housing Authority or their designee to execute all documents as
necessary.
By a vote of 4:0 (Jauregui, Turner, Yanez absent) at its Regular Meeting
of November 7, 2006.
DISCUSSION
City Gardens Apartments (project) is located at 2901 N. Bristol Street
(Exhibit 1). It is a 274 unit complex composed of one and two bedroom
apartments. On December 19, 1996, the Housing Authority issued tax-
exempt mortgage revenue bonds to finance acquisition and rehabilitation
of the project by its current owner, LINC-Bristol Associates 1, LP. The
partnership is comprised of LILAC Housing Corp. as the General Partner,
and Edison Capital Housing Partners VI, as a Limited Partner. The
existing bonds are subject to a mandatory redemption on December 1, 2006,
Resolution Authorizing The Issuance
Of Multi -Family Housing Revenue
Bonds - City Gardens Apartments
November 20, 2006
Page 2
and the owner has requested that the Housing Authority issue bonds for
the purpose of refunding the existing bonds in the amount of $8,400,000.
The owner will also simultaneously obtain a taxable loan for the purpose
of refinancing other project debt. The new bonds will be variable rate,
which will be capped at 5.75% for five years. By refunding the bonds,
there will be a reduction of debt service and an increase in cash flow to
the project.
The bonds are considered "conduit" obligations. This means that although
the Housing Authority will issue the bonds, the owner is actually the
borrower and has sole responsibility for repayment. The bonds will be
repaid strictly out of the project's cash flow. There is no recourse to
the Housing Authority, the City of Santa Ana or the Community
Redevelopment Agency.
Under the existing bonds, the owner is required to reserve twenty
percent, or 55 units, for occupancy at affordable rents by households
whose incomes do not exceed forty percent of the Orange County area
median income. This means that currently, the maximum allowable rent is
$635 for a one -bedroom unit and $712 for a two-bedroom unit. The
reissuance of the bonds will extend the affordability for an additional
55 years to help preserve this affordable option.
The law firm of Jones Hall has been retained as bond counsel, and CSG
Advisors has been retained as financial advisor. Final issuance of the
bonds is conditioned on final underwriting and approval by the lender,
ARCS Commercial Mortgage, and approval by the Housing Authority.
FISCAL IMPACT
The issuance of tax-exempt bonds will result in owner payment of a one-
time issuer fee, an annual affordable monitoring fee, and an annual
payment of a fee in -lieu of property taxes. Funds received will be
deposited in the Issuer Fee account (account no. 133-01-5594) and the
Payment in Lieu of Taxes account (account no. 507-01-5594).
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4'a <i A&
e11y an ry�ayle
Housin Manager
Community Development Agency
SGH/SLB/sr
APPROVED AS TO FUNDS AND ACCOUNTS:
a���' _�
y9rancisco GutierrezExecutive Director
Finance & Management Services Agency
N
CITY GARDENS APARTMENTS
2901 N. Bristol Street
EXHIBIT 1