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HomeMy WebLinkAboutMINUTES - 08132013 - C.43RECOMMENDATION(S): 1. APPROVE and AUTHORIZE the Conservation and Development Director, or designee, to execute required legal documents to provide $1,300,000 in HOME Investment Partnership Act (HOME) and $250,000 in Summer Lake Affordable Housing Trust funds to 73 Carol Lane L.P., a California limited partnership, for the Oak Ridge Family Apartment project in Oakley. 2. FIND, as the responsible agency, that the Notice of Determination prepared by the City of Oakley, as the lead agency, is adequate for purposes of compliance with the California Environmental Quality Act; and 3. DIRECT the Conservation and Development Director, or designee, to file a Notice of Determination for this project with the County Clerk; and 4. DIRECT the Conservation and Development Director, or designee, to arrange for payment of the $50 handling fee to the County Clerk for filing such Notice of Determination. APPROVE OTHER RECOMMENDATION OF CNTY ADMINISTRATOR RECOMMENDATION OF BOARD COMMITTEE Action of Board On: 08/13/2013 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: Kara Douglas 674-7880 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: August 13, 2013 David Twa, County Administrator and Clerk of the Board of Supervisors By: Chris Heck, Deputy cc: C. 43 To:Board of Supervisors From:Catherine Kutsuris, Conservation and Development Director Date:August 13, 2013 Contra Costa County Subject:APPROVAL OF HOME INVESTMENT PARTNERSHIPS ACT AND SUMMER LAKE AFFORDABLE TRUST FUND LEGAL DOCUMENTS FOR THE OAK RIDGE FAMILY APARTMENTS IN OAKLEY FISCAL IMPACT: No General Fund impact. HOME funds are provided to the County on a formula allocation basis through the U.S. Department of Housing and Urban Development (HUD). HOME CFDA# 14.256. The County has received Summer Lake Affordable Housing Trust funds from the City of Oakley pursuant to an agreement between the County and the City of Oakley. BACKGROUND: On May 13, 2013, the Board of Supervisors allocated $1,300,000 in HOME funds and $250,000 in Summer Lake Affordable Housing Trust funds to Corporation for Better Housing (CBH) for the Oak Ridge Family Apartment development. The Summer Lakes project was approved by the County prior to the annexation by the City of Oakley. As part of the annexation, the County and the City agreed that the $3,333.00 affordable housing fee charged for each new home would be collected and transferred to the County. The agreement requires that the funds be used in East County and the County consider reserving 20 percent of the fees for affordable housing development. As previously stated, the Board allocated $250,000 of the Summer Lake Affordable Housing Funds to Oak Ridge Family Apartments. The purpose of the Oak Ridge Family Apartment development is to improve the supply of multi-family rental housing affordable to and occupied by lower income households in East County through the construction of a 30 unit apartment building in Oakley. Eleven of the units will be designated as County-assisted. Three units will be affordable and available to households earning up to 30 percent of the area median income (AMI). Eight units will be affordable and available to households earning up to 50 percent of AMI. CBH has formed a limited partnership, 73 Carol Lane L.P. to develop and own this project. 73 Carol Lane L.P. will lease the site from CBH. HOME and Summer Lake Affordable Housing Trust funds will be used to support the construction of the development as a payment source for the construction loan. HOME and Summer Lake Affordable Housing Trust funds will be provided to 73 Carol Lane L.P. in the form of a 55-year, residual receipt loan at three percent interest rate. Affordability and use restrictions will be incorporated into the County loan documents. National Environmental Policy Act (NEPA): HOME projects are subject to NEPA and 24 CFR Part 58 review. The NEPA review for this project has been completed. Required mitigations are included in the loan agreement. Additional financing for the development includes tax exempt bonds which will be issued by the County, and low income housing tax credits. CBH may also apply for Federal Home Loan Bank Affordable Housing Program funds. Due to the high construction costs and limited revenue from the restricted rents, the total amount of the financing provided to the project will likely exceed the value of the completed project. Even though the proposed equity investment from low income housing tax credits is substantial compared to the amount of long term debt, the partnership agreement will have numerous safe guards of the investors equity. These safe guards essentially subordinate the County’s debt to the investor’s equity. Therefore, the County funds may not be fully secured through the value of the property. County Counsel has approved to form the following attached documents: • HOME and Summer Lakes Affordable Housing Trust Loan Agreement • Promissory Note • Deed of Trust with Assignment Of Rents, Security Agreement, And Fixture Filing • Regulatory Agreement and Declaration Of Restrictive Covenants CONSEQUENCE OF NEGATIVE ACTION: Without the approval and execution of the HOME and Summer Lake Affordable Housing Trust legal documents, the project will not be constructed. CBH must close on all financing in September or its tax exempt bond financing will be in jeopardy. CHILDREN'S IMPACT STATEMENT: The Oak Ridge Apartment project will support indicator number 3: Families are Economically Self Sufficient ATTACHMENTS Oak Ridge Loan Oak Ridge Promissory Oak Ridge Deed Oak Ridge RA