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CI~ OF SAN BERNARD~O - REQU~T FOR COUNCIL Ac.rtON
From: CRAIG A. GRAVES, City TreasureREclb'llj7fD14ltiYM~n.cement to funds for
january Bond payment for
Dept: OFFICE OF THE CITY TREASURER L!J7 DEe I i !,~f!:~eLaJ,ment District #5861
Date: December 9, 1987
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Synopsis of Previous Council action:
March 1987 - Mayor and Common Council authorizes the hiring of Sabo & Deitsch
to initiate foreclosure proceedings on deliquent property
owners on Assessment District # 5861 Bond payments
Recommended motion:
That the Director of Finance be authorized to advance $85,000 to Debt
Service Account of Assessment Bonds #5861, to be refunded to the City
at the completion of the property transactions.
Contact person:
Craig A. Graves
Phone:
Supporting data attached:
Yes
Ward: S; xt-h
FUNDING REQUIREMENTS:
Amount:
$85,000.00
Advance
Source:
Finance: ~ ---.. (J r.. ~
Council Notes:
75-0262
Agenda Item No.
I~
'CI~Y OF SAN BERNARD'laO - REQU"T FOR COUNCIL ACT'ION
STAFF REPORT
Assessment District #5861 is an assessment district formed to provide
offsite improvements where 1913/15 Act Bonds were sold to finance
the construction. Bond payments are made in January and July of
each year.
This district was formed in 1980 to assist with the development of
200 single family homes off of California Street and 16th Street.
The development was plagued with many problems and the holders of
the construction loans finally foreclosed on the homes and lots.
There are presently 123 homes and 77 vacant lots in the project. On all
of the vacant lots and a few of the homes we have deliquent bond
payments dating back to the beginning of the project.
The City has been able to keep the bondholders current by using the
Reserve Fund and excess Construction Funds to make timely Bond payments.
However, these funds have been exhausted.
The Mayor and Common Council authorized foreclosure proceedings to
commence against the delinquent property owners using the firm of
Sabo & Deitsch, with Steve Deitsch being the principal attorney.
Notification of the property owners has been completed and Mr. Deitsch
is now waiting upon the completion of a litigation guaranty before
filing of the proceedings.
However, there is still a bond payment to be made in January. In order
to prevent the City from defaulting on this issue $85,000 needs to
be advanced to the Bond Service Fund. This money should be refunded
to the City at either the sale of the property during the foreclosure
sale or during the transactions with a developer chosen through an
RFP.
It is requested that this matter be considered at 10:45 a.m. to allow
the scheduling of attorney for any questions. Mr. Penman and the
City Attorney's Office are being apprised of any developments.
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SABO 0:., DEITSCH
^ I'Hot.'LSS!II;S.-\1. (XlRPORAT10N
ATTOHj\;EYS AT LAW
SUITE 400
6320 CANOGA AVENUE
WOODLAND HILLS. CALIFORNIA 91367
UHRI 704-0195
TELECOPll<.:R (818) 704--4729
MEMORANDUM
FROM:
Mr. Craig Graves, City Treasurer
\-.!\
Stephen P. Deitsch :> J 1\
TO:
DATE:
November 24, 1987
RE:
Assessment District No. 5861
Tim Sabo mentioned that you would like a status report
concerning Assessment District No. 5861 foreclosure proceedings. I am
still in the process of obtaining a litigation guaranty concerning these
parcels. Following our determination by litigation guaranty of all
parties who may ha~e an interest in the subject parcels, we may then file
court proceedings naming all such parties as defendants.
I will henceforth keep you informed periodically of the status
of this matter.
SPD:bm