HomeMy WebLinkAboutMINUTES - 03122013 - C.79RECOMMENDATION(S):
1. APPROVE the Substantial Amendment to the County's FY 2012/13 Annual Action Plan allocating an additional
$139,165 in Neighborhood Stabilization Program 3 (NSP3) funds to Robin Lane, LLC for the Robin Lane
Apartments project in Concord.
2.
APPROVE OTHER
RECOMMENDATION OF CNTY ADMINISTRATOR RECOMMENDATION OF BOARD COMMITTEE
Action of Board On: 03/12/2013 APPROVED AS RECOMMENDED OTHER
Clerks Notes:
VOTE OF SUPERVISORS
AYE:John Gioia, District I Supervisor
Candace Andersen, District II
Supervisor
Mary N. Piepho, District III
Supervisor
Karen Mitchoff, District IV
Supervisor
Federal D. Glover, District V
Supervisor
Contact: Gabriel Lemus,
674-7882
I hereby certify that this is a true and correct copy of an action taken and entered on the minutes of the Board
of Supervisors on the date shown.
ATTESTED: March 12, 2013
David Twa, County Administrator and Clerk of the Board of Supervisors
By: June McHuen, Deputy
cc:
C.79
To:Board of Supervisors
From:Catherine Kutsuris, Conservation & Development
Date:March 12, 2013
Contra
Costa
County
Subject:Substantial Amendment to the FY 2012/13 Community Development Block Grant Program Action Plan to allocate
$139,165 in NSP3 Funds to Robin Lane, LLC
RECOMMENDATION(S): (CONT'D)
AUTHORIZE the Conservation and Development Director, or designee, to execute required amended legal
documents to provide an additional $139,165 in NSP3 funds to Robin Lane, LLC and to modify the construction
start date for the Robin Lane Apartments project; and
3. FIND that the project is exempt from the California Environmental Quality Act [Section 15301(a)]; and
4. DIRECT the Department of Conservation and Development (DCD) to file a Notice of Exemption for this
project with the County Clerk; and
5. DIRECT DCD to arrange for payment of the $50 handling fee to the County Clerk for filing such Notice of
Exemption.
FISCAL IMPACT:
No General Fund impact. Neighborhood Stabilization Program 3 (NSP3) funds were provided to the County from
the 2010 Dodd-Frank Act. NSP CFDA #14.218.
BACKGROUND:
On January 24, 2012, the Board of Supervisors approved the allocation of $1,523,046 in NSP3 funds to Robin
Lane, LLC for the acquisition and rehabilitation of Robin Lane Apartments, a 16-unit multi-family affordable
housing development located at 1890 Robin Lane and 1149 Meadow Lane in the City of Concord. Due to
increases in construction costs brought upon by rising costs in a rebounding construction industry, Robin Lane,
LLC has encountered a construction shortfall of approximately $250,000. There is $139,165 of NSP3 funds left
unallocated that staff recommends be allocated to Robin Lane, LLC. The additional $139,165 will help fill the
funding gap to begin the renovation of Robin Lane Apartments by April 1, 2013. The remaining funding gap will
be filled by funds from the Enterprise Green Retrofit Program, a non-County source.
Amended legal documents (Loan Documents) are attached and include the following documents:
Amended Loan Agreement
Amended & Restated Promissory Note
Modification Agreement to amend the Deed of Trust
Modification Agreement to amend the Regulatory Agreement
This recommended action includes authorization to execute any and all amended Loan Documents and to take any
and all actions necessary to implement the activities authorized under the amended Loan Documents.
CEQA/NEPA Determination:
This activity is exempt from CEQA pursuant to 14 CCR 15301(a); NEPA was completed for the project on
January 23, 2012 and was found to be exempt per 24 CFR section 58.34(a)(12).
CONSEQUENCE OF NEGATIVE ACTION:
Not awarding the additional funds will result in further delays in completing the project because Robin Lane, LLC
will have to continue its fund raising efforts.
CHILDREN'S IMPACT STATEMENT:
The project will provide affordable multi-family housing, which supports the Children's Report Card by helping
families become economically self-sufficient and enables families to be safe, stable, and nurturing.
ATTACHMENTS
Amended Loan Agreement
Amended Regulatory Agreement
Amended Deed of Trust
Amended Promissory Note
863\88\1267614.2 1
FIRST AMENDED AND RESTATED
PROMISSORY NOTE
(Robin Lane NSP3 Loan)
$1,662,211 Martinez, California
March 12, 2013
FOR VALUE RECEIVED, the undersigned Robin Lane LLC, a California
limited liability company ("Borrower") hereby promises to pay to the order of the County of
Contra Costa, a political subdivision of the State of California ("Holder"), the principal amount
of One Million Six Hundred Sixty-Two Thousand Two Hundred Eleven Dollars ($1,662,211) or
so much thereof as is disbursed to Borrower pursuant to the Loan Agreement (as defined below),
plus interest thereon pursuant to Section 2 below.
This First Amended and Restated Promissory Note ("Note") replaces in its entirety that
promissory note executed by Borrower for the benefit of Holder dated January 24, 2012, in the
principal amount of One Million Five Hundred Twenty-Three Thousand Forty-Six Dollars
($1,523,046) (the "Original Note"). Upon execution of this Note by Borrower, the Original Note
will be cancelled and retuned to Borrower.
All capitalized terms used but not defined in this Note have the meanings set forth in the
Loan Agreement.
1. Borrower's Obligation. This Note evidences Borrower's obligation to pay Holder
the principal amount of up to One Million Six Hundred Sixty-Two Thousand Two Hundred
Eleven Dollars ($1,662,211) with interest for the funds loaned to Borrower by Holder to finance
the acquisition of the Property and rehabilitation of the Development pursuant to the NSP3 Loan
Agreement dated January 24, 2012, between Borrower and Holder, as amended by a First
Amendment to NPS3 Loan Agreement of even date herewith (the "Loan Agreement").
2. Interest.
(a) Subject to Subsection (b) below, this Note bears simple interest at the rate
of three percent (3%) per annum from the date of disbursement (including the dates of
disbursement made under the Original Note) on the balance from time to time remaining unpaid.
(b) If an Event of Default occurs, interest on all amounts due under this Note
will accrue at the Default Rate until such Event of Default is cured by Borrower or waived by
Holder.
3. Term and Repayment Requirements. Payments due under this Note are due in
accordance with this Note and in accordance with Section 2.9 of the Loan Agreement. In any
event, the unpaid principal balance hereunder, together with accrued interest thereon, is due and
payable no later than March 12, 2068.
4. No Assumption. This Note is not assumable by the successors and assigns of
Borrower without the prior written consent of Holder, except as provided in the Loan
863\88\1267614.2 2
Agreement.
5. Security. This Note, with interest, is secured by the Deed of Trust. The terms of
the Deed of Trust are hereby incorporated into this Note and made a part hereof.
6. Terms of Payment.
(a) Borrower shall make all payments due under this Note in currency of the
United States of America to Holder at Department of Conservation and Development, 30 Muir
Road, Martinez, CA 94553, Attention: Affordable Housing Program Manager, or to such other
place as Holder may from time to time designate.
(b) All payments on this Note are without expense to Holder. Borrower shall
pay all costs and expenses, including re-conveyance fees and reasonable attorney's fees of
Holder, incurred in connection with the payment of this Note and the release of any security
hereof.
(c) Notwithstanding any other provision of this Note, or any instrument
securing the obligations of Borrower under this Note, if, for any reason whatsoever, the payment
of any sums by Borrower pursuant to the terms of this Note would result in the payment of
interest that exceeds the amount that Holder may legally charge under the laws of the State of
California, then the amount by which payments exceed the lawful interest rate will automatically
be deducted from the principal balance owing on this Note, so that in no event is Borrower
obligated under the terms of this Note to pay any interest that would exceed the lawful rate.
(d) This Note is nonrecourse to Borrower, pursuant to and except as provided
in Section 2.11 of the Loan Agreement which Section 2.11 is hereby incorporated into this Note.
(e) The obligations of Borrower under this Note are absolute and Borrower
waives any and all rights to offset, deduct or withhold any payments or charges due under this
Note for any reason whatsoever.
7. Event of Default; Acceleration.
(a) Upon the occurrence of an Event of Default, the entire unpaid principal
balance, together with all interest thereon, and together with all other sums then payable under
this Note and the Deed of Trust will, at the option of Holder, become immediately due and
payable without further demand.
(b) Holder's failure to exercise the remedy set forth in Subsection 7(a) above
or any other remedy provided by law upon the occurrence of an Event of Default does not
constitute a waiver of the right to exercise any remedy at any subsequent time in respect to the
same or any other Event of Default. The acceptance by Holder of any payment that is less than
the total of all amounts due and payable at the time of such pa yment does not constitute a waiver
of the right to exercise any of the foregoing remedies or options at that time or at any subsequent
time, or nullify any prior exercise of any such remedy or option, without the express consent of
Holder, except as and to the extent otherwise provided by law.
863\88\1267614.2 3
8. Waivers.
(a) Borrower hereby waives diligence, presentment, protest and demand, and
notice of protest, notice of demand, notice of dishonor and notice of non-payment of this Note.
Borrower expressly agrees that this Note or any payment hereunder may be extended from time
to time, and that Holder may accept further security or release any security for this Note, all
without in any way affecting the liability of Borrower.
(b) Any extension of time for payment of this Note or any installment hereof
made by agreement of Holder with any person now or hereafter liable for payment of this Note
must not operate to release, discharge, modify, change or affect the original liability of Borrower
under this Note, either in whole or in part.
9. Miscellaneous Provisions.
(a) All notices to Holder or Borrower are to be given in the manner and at the
addresses set forth in the Loan Agreement, or to such addresses as Holder and Borrower may
therein designate.
(b) Borrower promises to pay all costs and expenses, including reasonable
attorney's fees, incurred by Holder in the enforcement of the provisions of this Note, regardless
of whether suit is filed to seek enforcement.
(c) This Note is governed by the laws of the State of California.
(d) The times for the performance of any obligations hereunder are to be
strictly construed, time being of the essence.
(e) The Loan Documents, of which this Note is a part, contain the entire
agreement between the parties as to the Loan. This Note may not be modified except upon the
written consent of the parties.
IN WITNESS WHEREOF, Borrower is executing this Promissory Note as of the day and
year first above written.
Robin Lane LLC, a California limited liability company
By: SAHA Development, Inc., a California nonprofit
public benefit corporation, its sole member
By:____________________
Its:___________________
863\88\1281311.1 1
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
Contra Costa County
Department of Conservation and Development
30 Muir Road
Martinez, CA 94553
Attn: Affordable Housing Program Manager
APN:
No fee document pursuant to
Government Code Section 278393
(SPACE ABOVE THIS LINE FOR RECORDER’S USE)
FIRST AMENDMENT TO REGULATORY AGREEMENT
(Robin Lane)
This First Amendment to Regulatory Agreement ("Agreement") is dated March 12, 2013,
and is between Robin Lane LLC, a California limited liability company ("Borrower"), and the
County of Contra Costa, a political subdivision of the State of California (the "County").
RECITALS
A. Borrower made, executed and delivered to Beneficiary a Promissory Note dated
January 24, 2012 (the “Original Note”), which evidences Borrower’s obligation to repay a loan
made to it by the County for the purpose of acquiring and rehabilitating that certain real property
commonly known as 1149 Meadow Lane and 1890 Robin Lane (the “Property”), which is
located in the County of Contra Costa, State of California, and further described as follows:
See Exhibit A Attached Hereto
B. As part of the consideration for the loan from the County, Borrower agreed to
certain restrictions on the use of the Property. The restrictions run with the land and are set forth
in a Regulatory Agreement and Declaration of Restrictive Covenants by and between Borrower
and the County, dated January 24, 2012, which was recorded on January 31, 2012, as instrument
number 2012-022352 in the official records of the County of Contra Costa, State of California
(the “Regulatory Agreement”).
C. On March 12, 2013, Trustor made, executed and delivered to Beneficiary a First
Amended and Restated Promissory Note, which replaces the Original Note.
D. It is mutually desirable, beneficial and agreeable to the parties hereto that the
terms of the Regulatory Agreement be modified as hereinafter set forth.
863\88\1281311.1 2
NOW, THEREFORE, in consideration of the mutual benefits inuring to each other, it is
understood and agreed by and between the parties hereto, that the terms and conditions of the
Regulatory Agreement are hereby modified as follows:
AGREEMENT
1. Recital F is deleted in its entirety and replaced with the following:
Pursuant to a loan agreement of even date herewith between the County and Borrower
(the "Loan Agreement"), the County is lending to Borrower One Million Six Hundred Sixty-
Two Thousand Two Hundred Eleven Dollars ($1,662,211) in NSP3 Funds (the "Loan") to
finance the acquisition and rehabilitation of the Development.
2. Article 1 Definitions is modified by deleting certain definitions and replacing them in their
entirety as follows:
(u) "Note" means the First Amended and Restated Promissory Note dated March 12,
2013, which evidences Borrower’s obligation to repay the Loan.
(cc) “Term” means the term of this Agreement, which commences January 24, 2012,
and expires on the date that is fifty-five (55) years from the date of the First Amendment to
Regulatory Agreement, which is March 12, 2068.
3. All references in the Loan Documents to the Regulatory Agreement are hereby modified to
reflect the terms of the Regulatory Agreement as modified by this Agreement.
4. All terms, conditions, and covenants of the Regulatory Agreement, and other Loan
Documents, not otherwise modified hereby, are hereby ratified and confirmed, and this
Agreement is made part of the Loan Documents and has the same force and effect as if the
terms and conditions hereof were originally incorporated in the Regulatory Agreement and
other Loan Documents, prior to the execution thereof.
[Remainder of Page Intentionally Left Blank]
863\88\1281311.1 4
STATE OF CALIFORNIA )
)
COUNTY OF CONTRA COSTA )
On ____________ __, 2013, before me, _______________, Notary Public, personally appeared,
who proved to me on the basis of satisfactory evidence to be the person(s) whose name is
subscribed to the within instrument and acknowledged to me that he/she/they executed the same
in his/her/their authorized capacity, and that by his/her/their signature on the instrument the
person, or the entity upon behalf of which the person acted, executed the instrument.
I certify UNDER PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature ________________________________ (seal)
STATE OF CALIFORNIA )
)
COUNTY OF CONTRA COSTA )
On ____________ __, 2013, before me, _______________, Notary Public, personally appeared,
who proved to me on the basis of satisfactory evidence to be the person(s) whose name is
subscribed to the within instrument and acknowledged to me that he/she/they executed the same
in his/her/their authorized capacity, and that by his/her/their signature on the instrument the
person, or the entity upon behalf of which the person acted, executed the instrument.
I certify UNDER PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature ________________________________ (seal)
A-1
863\88\1281311.1
EXHIBIT A
Legal Description of the Property
1
FIRST AMENDMENT OF NSP3 LOAN AGREEMENT
(Robin Lane Apartments)
This first amendment (“First Amendment”) is dated March 12, 2013, and is between the
County of Contra Costa, a political subdivision of the State of California (the "County") and
Robin Lane LLC, a California limited liability company ("Borrower").
RECITALS
A. The County and Borrower are parties to a NSP3 Loan Agreement dated January
24, 2012 (the "Loan Agreement"), pursuant to which the County loaned Borrower One Million
Five Hundred Twenty-Three Thousand Forty-Six Dollars ($1,523,046) for the acquisition and
rehabilitation of the real property located at 1149 Meadow Lane and 1890 Robin Lane, in the
City of Concord, County of Contra Costa, State of California (the "Property").
B. Borrower has acquired the Property and is in the process of rehabilitating it.
Borrower now desires to borrow an additional One Hundred Thirty-Nine Thousand One Hundred
Sixty-Five Dollars ($139,165) of NSP3 Funds to be used in the rehabilitation of the
Development, bringing the total loan amount to One Million Six Hundred Sixty-Two Thousand
Two Hundred Eleven Dollars ($1,662,211).
C. In addition to increasing the loan amount, the parties desire to (i) modify the dates
by which rehabilitation of the Development must begin and end, (ii) modify the repayment start
date, (iii) modify the loan term, and (iv) replace Exhibit B, which sets forth the Approved
Development Budget.
The parties therefore agree to amend the Loan Agreement as follows:
AGREEMENT
1. Unless otherwise defined herein, defined terms have the meaning ascribed to them in the
Loan Agreement.
2. Section 1.1 Definitions is modified by deleting certain definitions and replacing them in their
entirety as follows:
(s) “Deed of Trust” means the Deed of Trust with Assignment of Rents, Security
Agreement, and Fixture Filing dated as of January 24, 2012, among Borrower, as Trustor,
Old Republic Title Company, as Trustee, and the County, as Beneficiary, which (i) was
recorded in the official records of Contra Costa County as instrument number 2012-022353,
(ii) was amended by a First Amendment to Deed of Trust dated March 12, 2013, and (iii)
encumbers the Property to secure repayment of the Loan and Borrower’s performance of the
Loan Documents.
(ee) “Loan” means One Million Six Hundred Sixty-Two Thousand Two Hundred
Eleven Dollars ($1,662,211) of NSP3 Funds.
2
(jj) “Note” means the First Amended and Restated Promissory Note dated March 12,
2013, executed by Borrower in favor of the County, which evidences Borrower’s obligation
to repay the Loan.
(qq) “Regulatory Agreement” means the Regulatory Agreement and Declaration of
Restrictive Covenants dated January 24, 2012, between the County and Borrower related to
the Loan, which was recorded in the official records of Contra Costa County as instrument
number 2012-022352, and which was amended by a First Amendment to Regulatory
Agreement dated March 12, 2013.
(ww) “Term” means the period of time that commences on January 24, 2012, and
expires on the date that is fifty-five (55) years from the date of the First Amendment to NSP3
Loan Agreement, which is March 12, 2068.
3. Section 2.7 Conditions Precedent to Disbursement of Loan Funds for Rehabilitation is
deleted in its entirety and replaced with the following:
The County is not obligated to make a disbursement of Loan funds for
rehabilitation costs in the amount set forth in the Approved Development Budget, or to take
any other action under the Loan Documents unless the following conditions precedent are
satisfied:
(a) All of the conditions precedent set forth in Section 2.6 have been timely satisfied;
(b) Borrower has executed and delivered the Note to the County, in form and
substance satisfactory to the County;
(c) The Deed of Trust, as amended March 12, 2013, has been recorded against the
Property in the official records of Contra Costa County;
(d) The Regulatory Agreement, as amended March 12, 2013, has been recorded
against the Property in the official records of Contra Costa County;
(e) There exists no Event of Default nor any act, failure, omission or condition that
would constitute an Event of Default under this Agreement, or the Project Agreement;
(f) Borrower has obtained all permits and approvals necessary for the rehabilitation
of the Development;
(g) The County has received and approved the Bid Package for the subcontractors for
the rehabilitation of the Development pursuant to Section 3.4 below;
(h) If the Borrower hires a general contractor to rehabilitate the Development as
required by Section 3.5 below, the County has received and approved the general contractor's
construction contract;
3
(i) If the Borrower does not hire a general contractor, and instead elects to use
subcontractors to rehabilitate the Development as required by Section 3.5 below, the County
has received and approved the contracts with all of the major subcontractors;
(j) The County has received and approved labor and material (payment) bonds and
performance bonds pursuant to Section 3.6 below;
(k) Borrower has closed all loans that are part of the Approved Financing described
in Section 1.1(h) and has already received or is eligible to receive the funds;
(l) The undisbursed proceeds of the Loan, together with other funds or firm
commitments for funds that Borrower has obtained in connection with the rehabilitation of
the Development, are not less than the amount the County determines is necessary to pay for
the rehabilitation of the Development and to satisfy all of the covenants contained in this
Agreement and the Regulatory Agreement; and
(m) The County has received a written draw request from Borrower, including (i)
certification that the condition set forth in Section 2.7(e) continues to be satisfied, (ii)
certification that the proposed uses of funds is consistent with the Approved Development
Budget, (iii) the amount of funds needed, and, (iv) where applicable, a copy of the bill or
invoice covering a cost incurred or to be incurred. When a disbursement is requested to pay
any contractor in connection with improvements on the Property, the written request must be
accompanied by (i) certification by the Borrower's architect reasonably acceptable to the
County that the work for which disbursement is requested has been completed (although the
County reserves the right to inspect the Property and make an independent evaluation); and
(ii) lien releases and/or mechanics lien title insurance endorsements reasonably acceptable to
the County.
(n) A title insurer reasonably acceptable to the County is unconditionally and
irrevocably committed to issuing endorsement numbers 110.6 and 108.8, or equivalent, to the
County’s ALTA Lender’s Policy of title insurance, insuring the priority the continued
priority of the Deed of Trust in the amount of One Million Six Hundred Sixty-Two Thousand
Two Hundred Eleven Dollars ($1,662,211).
4. Section 2.9 Repayment Schedule is deleted in its entirety and replaced with the following:
(a) Annual Payments. Commencing on May 1, 2014, and on May 1 of each year
thereafter during the Term, Borrower shall make a loan payment in an amount equal to the
County's Prorata Percentage of the Lenders' Share of Residual Receipts (each, an "Annual
Payment"). The County shall apply all Annual Payments as follows: (1) first, to accrued
interest, and (2) second, to principal.
(b) Payment in Full. Borrower shall pay all outstanding principal and accrued
interest on the Loan, in full, on the earliest to occur of (i) a Transfer, (ii) an Event of Default,
and (iii) the expiration of the Term.
4
(c) Prepayment. Borrower may prepay the Loan at any time without premium or
penalty. However, the Regulatory Agreement and the Deed of Trust will remain in effect for
the entire Term, regardless of any prepayment or Transfer.
5. Section 3.2 Permits and Approvals is deleted in its entirety and replaced with the following:
Borrower shall obtain all permits and approvals necessary for the rehabilitation of the
Development no later than April 1, 2013, or by such later date that the County approves in
writing.
6. Section 3.7 Commencement of Construction is deleted in its entirety and replaced with the
following:
Borrower shall cause the Commencement of Construction of the Development to
occur no later than April 1, 2013, or such later date that the County approves in writing. For
the purposes of this Agreement, "Commencement of Construction" means the date set for the
start of rehabilitation of the Development in the notice to proceed issued by Borrower to
Borrower's general contractor.
7. Section 3.8 Completion of Construction is deleted in its entirety and replaced with the
following:
Borrower shall diligently prosecute rehabilitation of the Development to completion,
and shall cause the rehabilitation of the Development to be completed no later than April 1,
2014, or such later date that the County approves in writing.
8. Exhibit B is replaced in its entirety with the Exhibit B attached hereto, which reflects the
increase in the Loan to One Million Six Hundred Sixty-Two Thousand Two Hundred Eleven
Dollars ($1,662,211).
9. All other terms of the Loan Agreement remain unchanged.
[Remainder of Page Intentionally Left Blank]
B-1
EXHIBIT B
APPROVED DEVELOPMENT BUDGET
Robin Lane Apartments
Development Budget
Land Cost 1,035,000
Acquisition T&R 4,095
Acquisition Holding Costs/Transfer Taxes 9,908
Predevelopment Loan Interest 2,458
Unit Construction 800,288
Abatement 20,000
Owner Furnishings 15,000
Hard Cost Contingency 100,920
Architecture 51,212
Survey 7,400
Engineering 5,000
Enviro Testing - Phase 1, Asbestos, Toxics 10,000
Construction Loan Fees - MHSA Origination 5,600
Construction Lender Costs/Expenses 13,997
Construction Lender Costs/Legal - Other 7,000
Loan Interest – Construction 1,414
Loan Interest – Lease-up 884
Construction Title & Recording 1,500
Owner Legal - Acquisition 3,784
Owner Legal – Construction 6,000
Operating Reserve (6 months) 33,913
Replacement Reserve 16,000
RE Taxes 31,050
Planning Fees & Building Permits 26,476
PG&E 10,000
AT&T 10,000
Builders Risk Insurance 25,000
General Liability Insurance 20,000
Operating Costs During Construction 126.00
Appraisal 2,400
Marketing & Leasing 25,000
Soft Cost Contingency 14,932
Developer Fee 156,313
Construction Management 9,900
Accountant Fee (Audit/Cost Cert) 7,500
Total
2,490,070
Sources of Funds
FHLB - AHP loan
150,000
Neighborhood Stabilization Program 1,662,211
CalHFA-MHSA Capital 560,000
Enterprise Bank of America Green Retrofit 117,859
Total
2,490,070