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HomeMy WebLinkAbout1985-046 1,020-27/0350S/jvz 01/25/85 RESOLUTION NO. R'l-46 RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN BERNARDINO, CALIFORNIA, DECLARING ITS INTENTION TO ISSUE ITS MULTIFAMILY MORTGAGE REVENUE BONDS; DIRECTING THE PREPARATION OF CERTAIN DOCUMENTS; AND MAKING CERTAIN OTHER FINDINGS AND DETERMINATIONS IN CONNECTION THEREWITH (MOUNTAIN GATE PROJECT) WHEREAS, the City of San Bernardino, California ("City"), is a "home rule city" duly organized and existing under and pursuant to a Charter adopted under the provisions of the Constitution of the State of California; and WHEREAS, pursuant to its home rule powers, the City duly and regularly enacted Ordinance No. 3815 (the "Ordinance") to finance various types of projects, as defined in the Ordinance, and to issue its special revenue bonds for the purpose of paying the cost of financing such projects, and has amended the same from time to time; and WHEREAS, said Ordinance No. 3815, as amended, is intended to finance the development of industry and commerce and to thereby broaden the employment opportunities and to increase the availability of moderately priced rental units for residents of the City and to broaden the tax and revenue base of the City; and - 1 - WHEREAS, there has been presented to the Mayor and Common Council an Application, attached hereto as Exhibit "A" and incorporated herein by reference by Block Group Developments (California), Inc., a California corporation (the "Applicant"), and its successors or assigns requesting the issuance of multifamily mortgage revenue bonds in the principal amount not to exceed $1,200,000 for the purpose of financing, on behalf of the Applicant, a certain Project, to wit: the construction and financing in one or more phases of a twenty-two (22) unit multifamily rental housing development which shall be constructed on an approximately one (1) acre parcel located on the north side of Kendall Drive approximately one and one half miles east of Little Mountain Drive and as more fully described in the Application. The Project shall consist of approximately twenty-two (22) two-bedroom, two-bath rental units, on-site vehicle parking spaces, laundry and recreational rooms, appurtenant landscaping and other improvements. NOW, THEREFORE, IT IS HEREBY RESOLVED, DETERMINED AND ORDERED BY THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN BERNARDINO, CALIFORNIA, AS FOLLOWS: Section 1. That the reci ta1s set forth hereinabove are true and correct in all respects. - 2 - Section 2. The City of San Bernardino, California, is a municipal corporation duly created, established and authorized to transact business and exercise its powers, all under and pursuant to the Constitution and laws of the State of California, and the City Charter of the City, and the powers of the City include the power to issue bonds for any of its corporate purposes. Section 3. Pursuant to the Charter of the City and Ordinance No. 3815, as amended, of the City, the City is legally authorized to issue special revenue bonds for the construction and permanent financing of the Project as more fully described in the recitals hereof. Section 4, This body constitutes the governing body of the City and is legally authorized to provide for the issuance of such special revenue bonds by the City. Section 5. The Project referred to in the recitals hereof constitutes a project which may be financed by the issuance of such special revenue bonds by the City and located wi thin the jurisdiction of the City. Section 6. The Council does hereby declare its intention to issue multifamily mortgage revenue bonds of the City for the acquisition of land and the construction, equipping and permanent financing of the Project under and in accordance with the Ordinance, in amounts sufficient to pay the costs of financing the - 3 - Project in one or more series of financings and of paying the costs of issuance for the multifamily mortgage revenue bonds and for the establishment of the necessary reserve funds to provide for the financing of said Project. Said Project is presently identified as the Mountain Gate Project. Section 7. The City hereby declares its intention to exercise the authority referred to in Section 3 hereof by issuing bonds of the City in such amounts as will be adequate to implement the City financing of the Project. Section 8. The bonds shall be payable from the revenues described in said Ordinance No. 3815, as amended. Section 9. The bonds shall be and are special obligations of the City, and, subject to the right of the City to apply moneys as provided in the applicable laws, are secured by such revenues as are specified in the proceedings for the issuance of such bonds and funds and accounts to be held by the trustee or fiscal agent, and are payable as to principal, redemption price, if any, and interest from the revenues of the City as therein described. The bonds are not a debt of the City, the State of California or any of its political subdivisions, and neither the City, the State, nor any of its political subdivisions is liable thereon, nor in any event shall the bonds be payable out of the funds or properties other than all or any part of the revenues, mortgage loans, and funds and accounts as in this Resolution set - 4 - forth. The bonds do not constitute an indebtedness within the meaning of any constitutional or statutory debt limitation or restriction. Neither the persons serving as the Mayor and Common Council nor any persons executing the bonds shall be liable personally on the bonds or subject to any personal liability or accountability by reason of the issuance thereof. Section 10. The details of such bonds, including the establishing of the aggregate face amount of such obligations, shall be authorized by indenture, resolution or resolutions of the City at a meeting or meetings to be held for such purpose. The City Staff. Timothy J. Sabo. a Professional Corporation. as Bond Counsel to the City, Underwriters. the Applicant and the agents and representatives of same are hereby authorized and directed to prepare or cause to be prepared the necessary legal documents, including the Project Agreement, Resolution of Issuance. and such other documents as may be necessary to effect said Project and the issuance of industrial development revenue bonds therefor and to present same to said Mayor and Common Council. The Mayor of the City is hereby authorized and directed to coordinate the efforts of all concerned relating to the issuance and sale of the bonds, and the City Staff, consultants. legal counsel to the City and Bond Counsel as referenced above are hereby directed to take such steps as shall be appropriate to implement such sale and delivery of the bonds including working with persons who may acquire vested rights as the result of such actions. - 5 - Section 11. The issuance of multifamily mortgage revenue bonds may be authorized by appropriate resolution or resolutions of the City at a meeting or meetings to be held for such purpose, subject to the execution of appropriate agreements by the Applicant and the City as required by the Ordinance and the industrial development bond financing program of the City. Section 12. It is intended that this Resolution shall constitute such "official action" toward the issuance of the bonds within the meaning of the United States Treasury Regulations, the United States Tax Laws, and any legislation now or hereafter pending in the Congress of the United States which may require official action in order for the bonds to be exempt from Federal income taxation. Section 13. At the closing of the financing there shall be paid to the City the fee set forth in Resolution No. 81-108 of the Mayor and Common Council, adopted March 13, 1981, as amended by Resolution No. 81-410, of the Mayor and Common Council, adopted September 24, 1981. - 6 - Section 14. This Resolution shall take effect upon adoption. I HEREBY CERTIFY that the foregoing resolution was duly adopted by the Mayor and Common Council of the City of San Bernardino at an adiourned reaular meeting thereof, held on the 28th day of January , 1985, by the following vote, to wit: AYES: Council Members r.~~r~n~n~. R~illy. ~Qrn9nnlo7. ()n;Al Fr~7.iAr ~~r;~klAr . NAYS: None ABSENT: Council Member Marks ~//~~M City Clerk The foregoing resolution is hereby approved this Iff day of Februarv , 1985. Approved as to form: hy~ Ci ty Att rney - 7 - PART I 1.1 APPLlCATIOO Q[ BIOCK GRrnP nF.\11iY/1llMIONI'R (CALIroRNIAl E HlR TNmS'lRIAL RE.VIHlE BCtlIl ~ .cD:I Dr .sm RF.IlNlIRnTNO. CALlmRNA GENERAL l\ND BUSINE5S INEORMATIOO '!he legal name of the Applicant is -Block Group Del7e1opnents (California) INC.- '!he all>1icant is a California oorporation which shall engage in the deve1opnent, leasing, and o.mership of approximately 22 apiI'tment Wlits located off of Kendall Drive in the City of San Bernardino, California. '!he real property where the apartments will be oonstructed is o.med ~ Block Bros. Industries (USA) Inc. '!he mailing address of the Applicant is: Block Group Del7e1opnents (California) Inc. c/o Marlborough Del7e1opnent Corp:>ration 2029 Century Park Fast 11550 IDs Angeles, CA 90067 1.4. &nployer Tax I.D. No. - NA 1.2 1.3. 1.5 Mr. Dorian A. Johnson, A.I.A. is the principal contact for the Applicant. 1.6 '!he teleJ;ilone nllllber for the Applicant is (213) 553-5131. 1. 7 '!he Applicant is a California Corp:>ration. 1. 7.1 '!he Applicant shall CMIl property and conduct rosiness in the CoWlty of San Bernardino, State of California. '!he all>1icant is not related to any other legal entity. 1.7.2 1.8 Business ventures of the general partners of the Applicant: A. Block Group Del7e1opnents (California) ,Inc. has extensive land holdings in the State of California and includes the 600 acre master plan deve10pnent knCMIl as Shandin Hills located in the City of San Bernardino. Block Bros. Industries (USA) Inc. is a wholly-owned subsidary of Olynpia & York, Inc. 1.9 &nployees '!he all>1icant currently has zero Employees. However, oonstructian and oanpletian of the Project ~ the Awlicant will ultimately pr0\7ide nunerous Employment opp:>rtWlities in the City of San Bernardino. '!he Applicant plans to locate in San Bernardino CoWlty. '!he Awlicant currently has offices at c/o Marlborough Del7e1opnent Corp:>ratian. 2029 Century Park Fast, SUite 1550, IDs Angeles, CA 90067. 1.10 Professional services will be provided as follows: 10.1 steres, Alpert & Carne shall serve as the accolUltant for the ~icant and the contact person with said firm is Gar:y Carne, tel~one nl.1llber 619/292-3200. 10.2 '!he law firm of Gresham, Varner, Savage, Nolan & Tilden. 398 West Fourth Street, San Bernardino, CA 92401. is the attorney for the Applicant. 10.3 '!he law offices of Timothy J. sabo shall serve as Bond Col.Ulse1 to the City with regard to the tax-exempt financing for the project. 10.4 '!he principtl civil engineer shall be Psanas/Harris & Assoc. 3901 Lime st. Riverside, CA 92501. 1.12 10.5 '!he principtl architect shall be Dorian A. Johnson, A.I.A. 2029 Century Park Fast, SUite 1550, Los Angeles, CA 90067. '!he principtl banking accolUlts of the ~icant shall be at Security Pacific National Bank, San Bernardino, and opened upon financing becaning available. '!he source of flUlding for the Project is anticipited to be derived fran a variety of sources including the private placenent of a tax-exempt bond or other obligation wiht a lender to be ootained hereafter. B<lID ISSUE 1.11 PART II 2.1 '!he estimated total cost of the financing pickage and the proposed use of bond proceeds is as follows: 2.1.1 Construction costs $689,000 2.1.2 Legal, printing and related fees 50,000 2.1.3 Financing costs and fees 150,000 2.1.4 Capitalized interest 191,000 2.1.5 rand aCX}uisition (has been aCX}uiredl Total $1,080,000 2.2 '!he estimated target date for the financing is presently anticipited in 1986 with construction to cannence as soon as possible after the financing pickage is canplete and construction to be canpleted in 6 IOOIlthS. 2.3 It is proposed that the financing be in the fOIIII of a constructioo loan during the constructioo period which would have the traditiooal constructioo loan prOl7isions in that drawdowns would be premitted as constructioo proceeds upon subnissioo of requisitions vouchers. Upon oanpletion of constructioo of the Project and certificatioo that all imprOl7anents have been oanpleted, the lender will then peIlllit an interest rate adjustment and a principal anount increase, as warranted, and convert the constructioo loan to a peIlllilIlE!nt financing. 2.4. 'nle present proposal for the financing of the Project anticipltes that the tax exempt bonds or other obligations will be sold to a carmercial bank or other such lender through a private placenent or that there be a plblic offering of said securities. PART III FINANCIAL INroRMATIOO 3.1 '!he Awlicant shall be a snall business doing I::usiness as a corporatioo p.u:suant to the laws of the state of California, and the Awlicant would be considered a snall business with regard to its relative size in canpirison with other such businesses undertaking projects of this type. Although the Awlicant is a snall business, no federal snall business loan guarantees were proposed in connectioo with the proposed financing as contE!llplated ~ this Awlicatioo. PART W PIDJElCl' INroRMATIOO 4.1. '!he Project as proposed ~ the Awlicant shall include the constructioo of approximately 22 apirt:ment units in the Shandin Hills area of san Bernardino. '!he approximate 22 units shall be constructed OI7er a 6 month period. '!he anenities in the apirtment project shall include a SW'inming pool, recreatioo center, and barbeque areas. '!he proposed Project shall be located upon land which is more plrticularly described in Exhibit "A" attached hereto. '!he Project is a business venture that would increase the assessed valuatioo of currently underutilized land and generate significant E!IIployment opportunities within the city. 4.2 '!he canponents of the estimated total cost of the functiooal plrts of the Project are as follows: 4.2.1 land $ 132,000 4.2.2 Building construction 561,000 4.2.3 Engineering & technical services 50,000 4.2.4 Miscellaneous itE!llS a. 5% constructioo contingency 28,000 b. Interest during constructioo 191,000 c. Real estate brokerage oc.mnissioo -0- d. Other miscellaneous costs 50.000 Total $1,012,000 4.3 '!be estimated oonstruction period for the Project is as follows: 4.3.1 construction of the Project would ocmnence as soon as possible after issuance of the tax-exempt obligations. '!he planned oonstruction shall be oanpleted within 6 IOOIlthS fran the date of camtencenent. 4.3.2 4.4 '!be supervising civil engineer responsible for the design of the Project on behalf of the Applicant shall be Psanas/Harris, 2901 Lime St. Riverside, CA 92501. 4.5 '!be Project shall be known as "Mountain Gate". 4.6 '!be Project site is the developnent of aplrtment units and is not an expansion or an alteration of an existing facility. '!he necessary infrastructure items and other public improvements must be installed 00 the Project site and the Applicant desires to obtain a below narket rate tax-exempt oonstructioo and permanent financing of the improvements to be placed thereon fran a oanbination of sources. 4.7 '!he property on which the Project is proposed to be located is currently owned ~ Block Bros. Industries (USA) Inc. 4.8 '!he Project will provide awroximately 22 rental units to be leased to various tenants. 4.8.2 Attached as Exhibit "B" is an 8-1/2 x 11 inch map showing the site locatioo of the proposed Project. A description of the plant process-not applicable. 4.8.1 4.9 A negative declaration p.1rsuant to the provisions of the California Enviranental Quality Act of 1970, as EIIIended, would in all probability be satisfactory for the Project as proposed ~ the Applicant. However, the Project shall oanply with all applicable proviSions of said Act. 4.10 '!here are no permits, water quality enforcement orders, air pollutioo permits or variances or other evidence of actions necessary in oonnection with this Project. 4.11 '!bere are no local, state or federal pollution control agencies which iIrp>se regulations, standards or requirements wiht regard to the opera- tions of the proposed Project to be undertaken ~ the Applicant. 4.12 '!he proposed Project shall canply with all applicable City of san Bernardino, County of san Bernardino, and other regional, oounty or basin plans to which this Project shall OOnfOIIII and the awropriate waste water and air quality requirements which shall be in oonformity with all of the above jurisdictions. 4.13 It is presently anticip;t.ted that the proposed Project will not produce any byproducts or residues which would involve the ultimate disposal or the need for a plan to accanpJ.ish same. Recycling or salvage will not be a function of the proposed Project nor will there be any market opportuni- ties generated with regard to same. 4.14 '!be Project shall consist of ag;>roximately twenty two (22) ap;t.rbnent units in four (4) two-story bIildings located on an ag;>roximately oneIl) acre site 00 the North side of Kendall Drive, ag;>roximately one and ooe half (1 ]/2) miles Fast of Little It>untain ("'!be Project"). '!be Project shall include approximately 44 on-site vehicle pirking spaces; one (1) pool, landscaping and recreation areas. '!bere shall be twenty two (22) two bedroan, two bath units renting for ag;>roximately $520 per month. PART V RlBLIC BJ:lmFITS 5.1 '!be City of san Bernardino will receive significant benefits by the initiation of this Project as proposed by the Awlicant and pirticularly through the utilitization of the financing method as is available under Ordinance No. 3815, as lIIIended, of the City of san Bernardino. Due to the fact that conventiooal interest rates for construction and peIlllaI1ent financing for the type of Project contemplated by the Awlicant are at such an extreme level 00 conventionally borrowed funds, if available at all, neither the Awlicant nor any other persons or legal entities are able to provide the type of trodern and attractive apirbnent bIildings needed within the City of san Bernardino. Jldditiooally, the City of san Bernardino, its inhabitants and the Redevelopnent llgency of the City of san Bernardino will benefit fran the increased assessed valuation of the property within the Redevelopnent Project Area. Said increased assessment will occur as the result of the canpletion of the Project. '!bis increase in the assessed valuation of the property included in the Project will assure that the Redevelopnent 1lgency of the City of san Bernardino will have a IOOre viable means of undertaking its redevelo~ ment activities within said Project Area. '!be City likewise would benefit by obtaining quality housing for the citizens of san Bernardino. other businesses will be encouraged to locate or relocate within the City of san Bernardino and thus create an upward spiraling effect on the econany of the City as a result of the Project. 5.1.1 Project will provide loog teen employment opportunities for the inhabitants of the City of san Bernardino. When fully constructed leased the Project will provide employment oppor- tunities for a substantial mlllber of persons. '!be category jobs to be provided in the Project after its canpletion include managerial, skilled, semi-skilled, and unskilled. '!be wages to be piid in the various job categories meet local and regiooal standards and will sustain a satisfactory level of financial stability. 5.1.2 Construction of the Project is anticip;t.ted to add ag;>roximately $1,000,000 assessed valuation to the tax rolls of the City. 5.1.3. '!he useful method of financing provided for in Ordinance No. 3815 of the City vis-a-vis the use of the conventional method will peIIlli.t the Applicant to oanplete the financing and construction of the Project within an accelerated time frame. '!he method of financing provided in Ordinance No. 3815 will provide new sources of financing to the Applicant and such financing will be IIBde at lower tax-exempt interest rates. 5.2 '!he City will benefit, as can be demonstrated plrsuant to section 1 of Ordinance 3815, as anended, of the City of San Bernardino, in that empl~t opportunities will be generated by the proposed Project both during the construction Iilase and after said Project is constructed and leased. 'lhe Applicant is not attenpting to construct said proposed Project merely for the financial inducement that is offered plrsuant to the Ordinance, but rather due to the long-teI!ll business reasons that are significant due to the location of the proposed Project and the real eoonanic benefits available to the camnunity. '!here are no detriments that can be incurred by the City with regard to this type of financing for this Project, and the City of San Bernardino and the Redevelopnent l\gency of the City of San Bernardino will receive substantial benefits through increases in assessed valuation of property within a redevelopnent Project area, plus the increased long-teI!ll empl~t opportunities that will be available to the local residents of the City. PART VI CXJMMI'DIENTS 6.1 'lhe Applicant by the sul:mission of this Application agrees to oanply and/ or to assist the City in oanplying with all state and federal laws in the issuance of the bonds or other such tax-exempt obligations to finance the Project, inCluding, without limitation, IIBking of arr.I required application to a governnental deparbnent, for authorization, qualifi- cation or registration of the offer, issuance or sale of the bonds or other tax-exempt obligations, and arr.I adnenanents thereto, and arr.I peIIlli.t or other authorization of such goverrmental deparbnent, prior to the delivery by the City of such bonds or other tax-exempt obligations. 6.2 '!he Applicant further coomi.ts to cause and/or to assist the City in causing to be printed arr.I prospectus or other written or printed cannun- ication proposed to be plblished in connection with issuance, offer or sale of bonds or other tax-exempt obligations, prior to the delivery by the City of such bonds or other tax-exempt obligations, and, to the extent deemed necessary by the City, following delivery of such bonds or other tax-exempt obligations. 6.3 '!he Applicant also camli.ts to pay all expenses in cormection with the issuance, offer or sale of the bonds or other tax-exempt obligations, whether or not such bonds or other tax-exempt obligations are finally issued, and to hold the City haIlll1ess fran arr.I and all expenses related thereto, to pay itens on an ongoing basis so that neither the City, nor its advisors, attorneys, employees and the like will accunulate arr.I claims against the City. 6.4 The Applicant will suw1Y any additional information, agreenents, and undertakings as the City may require as the result of conferences and negotiations will be reproduced and supplied to the City and shall be deened as suwlements or anenanents to this Applicatioo. PART VII SIGNAWRE 7.1 The undersigned as authorized princip;l1s of the Applicant as ooted be1CM, hold the prime responsibility for the financing to be taken for the proposed Project, and certify that the undersigned have the authority to bind the Applicant to contract terms; that this Application to the best knowledge or belief of the undersigned, contains 00 false or incorrect informatioo or data, and this Application , inCluding exhibits and attacbnents hereto, is truly descriptive of the proposed Project. The undersigned also represent ~ the execution of this Applicatioo familiarity with Ordinance No. 3815, as anended, of the City of San Bernardino. PART VIII FEE SCJIEWLE 8.1 The Applicant acknowledges that the City requires a non-refundable awlicatioo fee of $50.00 for each Project to be considered for eligibility to be paid when the basic docImtents are requested. With the subnittal of the Application, $500.00 is plyable to the City. If this Application is accepted, an additiooal fee of $10,000 is P'lyable for Pdninistrative costs. 'D1e Applicant acknCMledges that the camli.bnents in Part VI above are in additioo to these fixed amounts. 'D1us, in the event that 00 closing occurs, the City shall be reiJrbursed for its process- costs. 8.2 All Fees of the City may be capl:a1ized and included in the bond issue as acceptable to the bond fUrchaser. 8.3 '!be AH?licant acknowledges that the City derives its entire SUWOrt fran the fees for its services. '!he total functioo of the City is conducted 00 a self-sug;x>rting basis, and involves no state general revenues or expenditures fran taxes fran the state or lIl\Y of its political sub- divisioos. No indebtedness or taxing ~er of the City is involved. Project revenues are the sole security for bonds of the City. '!he federal guarantees, if lIl\Y, enhance these revenues and incane and the security of the bonds. 8.4 Pursuant to Resolutioo No. 81-108 of the City, as amended ~ Resolutioo No. 81-410 of the City, ooe percent (1%) of the princiISl <mount of the bond issue shall be deposited in the City Treasury in the Industrial Revenue Bond Reserve and Developnent Fund, which shall be used in such nanner as the Mayor and cannon Council may direct fran time to time. APPLICANT BIDCK GRXJP DWELOl'MENTS (CALIFORNIA) ,INC. ILl ...: .-; > en en 0 <l CD Z A'II'" 'II1:I1:I31S ----, >= Q ~ ~ ..: ~ - '.LS ,3, ~ 0 ..,. <( :.+:: ...: 8 en '.is ..: ~ -- 0 ~ I"l -~ L.'( J::C.. '" .,.: , Z b...l II) - , -, -~ <( CO f ~- ..: ,... - U) t\I CD -?f.'V \U>1<;71"\ .,. NONI:I3^ '.LW '.LS .L .io:>snw ~ -<..t--<" CO ~~~ ,~ - . < . .... ... ..co ... .c >< ..... , ~ .~~ --,,----- - (\j .!. '" ~ <3 00 ~~ o. C" i{$ CoO :~le ~!......-L "..: .,."...u_ ~ u. 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