HomeMy WebLinkAboutMINUTES - 07281992 - 1.59 59
TO: BOARD OF SUPERVISORS
Contra
FROM: Harvey E. Bragdon �� ; Costa
Director of Community Development
�•� ��.. i J,
DATE: July 28, 1992 County
SUBJECT: Multi-Family Mortgage Revenue Bonds
SPECIFIC REQUEST(S) OR RECOMMENDATIONS (S) & BACKGROUND AND JUSTIFICATION
RECOMMENDATIONS
Authorize the Director of Community Development or the Deputy Director
- Redevelopment to prepare and submit necessary applications and
certifications to the California Debt Limit Allocation Committee for
up to $50 million in Private Activity Bond Authority to be used in the
issuance of the County's 1992-A Multi-Family Mortgage Revenue Bonds/or
the Park Regency Project (Pleasant Hill BART) ; and designate Goldman
Sachs as senior manager and M. R. Beal, and Artemis Capital Group as
co-managers, and Orrick Herrington & Sutcliffe as Bond Counsel.
FISCAL IMPACT
None. No General Fund dollars are involved. All costs associated
with the issuance and administration of this program are paid from
bond proceeds.
BACKGROUND/REASONS FOR RECOMMENDATIONS
The Federal Government has placed a limit on the volume of "Private
Activity Bonds" (single and multi-family bonds, Mortgage Credit
Certificates, Industrial Development Bonds, etc. ) which may be sold
in each state. In California the task of apportioning this limit
among issuers is assigned to the California Debt Limit Allocation
Committee, a unit of the State Treasurer's office.
CONTINUED ON ATTACHMENT: YES SIGNATURE: 40,
RECOMMENDATION OF COUNTY ADMINISTRATOR RECO DATION Od BOARD COMMI EE
APPROVE OTHER
.
SIGNATURE(S) :
ACTION OF BOARD ON APPROVED AS RECOMMENDED X OTHER
67
VOTE OF SUPERVISORS
I HEREBY CERTIFY THAT THIS IS A
' UNANIMOUS (ABSENT "�- ) TRUE AND CORRECT COPY OF AN
AYES: NOES: ACTION TAKEN AND ENTERED ON THE
ABSENT: ABSTAIN: MINUTES OF THE BOARD OF
SUPERVISORS ON THE DATE SHOWN.
orig: Community Development / 99
cc: CAO ATTESTED__
County Counsel PH&L BAffCHELOR, CLERK OF
Housing Authority THE BOARD OF SUPERVISORS
via Community Development AND O NTY AD INISTRATOR
Goldman Sachs
Orrick, Herrington & Sutcliffe BY , DEPUTY
GBW Properties
SRA3/multirb.bos
Staff has been approached by GBW Properties to provide Multi-family
Mortgage Revenue Bond financing for that portion of the Park
Regency project which does not currently have multi-family
financing. In 1989 the County financed 422 of the 892 units in
this project with Multi-family Mortgage Revenue Bonds. The
developer now desires to finance the entire project with Multi-
family Bonds.
The developer will be required to submit a monetary deposit equal
to 1% of the requested amount in order to allow the County to make
the necessary certifications to the State. In addition, the
developer will be required to pay for all costs associated with the
issuance and the ultimate administration of this project.
The proposed structure for the bonds is anticipated to result in a
AAA rating. The proposed structure includes bond insurance and a
collateral pledge by Teachers Insurance and Annuity association, a
"AAA" rated insurance company. The developer has been working with
the investment banking firm of Goldman Sachs in preparing this
financing structure and negotiating the terms with the credit
enhancement parties. They have requested that Goldman Sachs be
designated as the senior manager on this account. Staff concurs.
Co-managers are also being designated consistent with the County's
MBE/WBE policies. The co-managers are M. R. Beal (an MBE) and
Artemis Capital Group (a WBE) . Both firms have strong capability
in the marketing of variable rate bonds to institutional buyers.
Because the issue will result in a refunding of the 1989-B Multi-
family Bonds issued for this project, it is necessary and
appropriate to utilize the same bond counsel firm - Orrick,
Herrington, & Sutcliffe.
The issuance of these bonds will substantially increase the
affordability of low income units in the Park Regency project. A
total of 179 units will now be available for very low income
families at rents of approximately $450-$500. Prior to this
proposed financing approximately 85 units were available for very
low income families, plus an additional 49 units for moderate
income families.
Anticipating a mid-September receipt of "Private Activity" Bond
Authority, issuance of bonds would occur in early October.