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Home My WebLink AboutR9- Economic Development ECONOMIC DEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO REQUEST FOR COMMISSION/JOINT POWERS FINANCING/COUNCIL ACTION From: Timothy C. Steinhaus Subject: MULTIFAMILY HOUSING Agency Administrator REVENUE BONDS - MOBILEHOME PARK Date: November 27, 1995 ------------------------------------------------------------------------------- Synopsis of Previous Commission/JPA/Council/Committee Action(s): None. ------------------------------------------------------------------------------- Recommended Motion(s): OPEN PUBLIC HEARING CLOSED PUBLIC HEARING (Mayor and Common Council) MOTION A: RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN i BERNARDINO, CALIFORNIA, REGARDING THE USE OF HOME FUNDS IN CONNECTION WITH THE MODERATE OR SUBSTANTIAL REHABILITATION OF MERIDIAN TERRACE MOBILE HOME PARK. (Recommended Motion(s) Continued on Page 2) I I Admin Services Timothy C. Steinhaus Agency Administrator --------------------------------------------------------------------------- Contact Person(s) : Barbara Lindseth/Tim Steinhaus Phone: 5081 Project Area(s): None Ward(s): Third Supporting Data Attached: Staff Report: Resolutions Funding Requirements: Amount: $550,000 Source: HOME Funds Budget Authority: FY 1995-96 Budget ---------------------------------------------------------------------- Commission/Council Notes: ------------------------------------------------------------------ TCS:bl:2122A COMMISSION MEETING AGENDA 'wool Meeting Date: 12/04/1995 q 1 - Re6 G 5"-- 7/ 7 Agenda Item Number: P, Oil p o/ c: - 'f p �� -C Recommended Motion(s) Continued: Mayor and Common Council) MOTION B: RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN BERNARDINO, CALIFORNIA, APPROVING THE ISSUANCE OF CERTAIN MULTIFAMILY HOUSING REVENUE BONDS AND THE BORROWING BY THE REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO OF THE PROCEEDS THEREFROM PURSUANT TO A CERTAIN LOAN AGREEMENT AND APPROVAL OF THE ISSUANCE OF SAID BONDS UNDER SECTION 147(f) OF THE INTERNAL REVENUE CODE. (Joint Powers Financing Authority) MOTION C: RESOLUTION OF THE SAN BERNARDINO JOINT POWERS FINANCING AUTHORITY AUTHORIZING THE ISSUANCE OF NOT TO EXCEED $5,100,000 MULTIFAMILY HOUSING REVENUE BONDS (MERIDIAN TERRACE MOBILE HOME PARK PROJECT) SERIES 1995A, APPROVING THE FORM OF LEGAL DOCUMENTS RELATED THERETO AND AUTHORIZING AND DIRECTING PREPARATION, EXECUTION AND DELIVERY OF THE FINAL FORMS THEREOF. (Community Development Commission) MOTION D: RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF SAN BERNARDINO, AUTHORIZING, ON BEHALF OF THE REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO, THE BORROWING OF FUNDS FROM THE SAN BERNARDINO JOINT POWERS FINANCING AUTHORITY IN CONNECTION WITH THE ISSUANCE OF CERTAIN MULTIFAMILY HOUSING REVENUE BONDS FOR THE PURCHASE OF THE MERIDIAN TERRACE MOBILE HOME PARK. -------------------------------------------------------------------------- ----- TCS:bl:2122A COMMISSION MEETING AGENDA Meeting Date: 12/04/1995 Agenda Item Number: ECONOMIC DEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO STAFF REPORT Multifamily Housing Revenue Bonds - Mobilehome Park Background Pursuant to the Mobilehome Conversion Program, Agency staff and consultants have completed or substantially completed due diligence on the Meridian Terrace Mobile Home Park ("Park") . The financing structure contemplates that the Agency will acquire ownership of the Park from the present private owners through the issuance of multifamily revenue bonds. Such a bond issue will provide the funds needed to pay the purchase price for such Park and to pay certain costs of issuance. Additional costs of acquisition will be funded by the provision of HOME funds from the City to the Agency to the extent necessary. The bonds are being issued under certain provisions of the Internal Revenue Code to enable the Agency to transfer said Park to a non-profit corporation for operation and maintenance. The following represents the bonds to be issued and the estimated amount of HOME funds needed: Meridian Terrace - Issue of $5,100,000 243 North Meridian - 257 spaces Estimated HOME funds - $550,000 (to extent available) A fee agreement with the London Group was previously approved by the Commission as to the amount and the method of payment. The restructuring of the fee agreement with the London Group is required so that the conversion fees are not paid from the bond proceeds or as a lump sum amount upon acquisition, but rather so that said fees are paid from excess cash flow from the acquired mobilehome parks and from the low- and moderate-income housing fund, as necessary, for a ten (10) year period, with interest not to exceed 7%. A public hearing must also be held pursuant to the federal tax laws prior to undertaking a financing by a public body of tax-exempt obligations for a 501 (c)(3) non-profit corporation. Qualified 501 (c)(3) bonds will be issued by the Agency to fund the original acquisition, and such bonds will remain in place upon and after acquisition of a particular mobilehome park by the subsidiary non-profi corporation. i Based o e oregoing, staff recommends adoption of the form motions. Timothy C. St 'nhaus, Agency Administrator ------------------------------------------------------------------------------- TCS:bl:2122A COMMISSION MEETING AGENDA Meeting Date: 12/04/1995 NO Agenda Item Number: City of San Bernardino ` I------- IJ �z `•,\ L 215 ( ° 6 e \\ Or Norrhpar¢% • % 2::::;:;::x-:::.2 �` 1 � 40th St o •---------- Y N �p Parkdale h.1 Marshall fi .. r Highland Ave r I �• — 161 h St ---sJ ---• 4i _-Z •I L- - -J i Baseline t-----' stn St — 30 Pr - -� — —r I — 5th St Foothill Blvd E p ti an Rialto Ave Mill St ' 215 w !----------t �� N — c m /' Q I E I — E C as C Hos ilalit � I I I % NORTH _-._--_--_.._.-_--_ San Bernardino city limit Map not to scale San Bernardino county area Revised:September,1994 PROPERTY PROFILE Property Name: Meridian Terrace Mobilehome Park Property Address: 243 North Meridian Avenue San Bernardino, CA 92410 Property Phone No: (909) 888-0218 Manager: Sylvia Vasquez and Manuel Almaza Park Owner: Safety Investment Company Park Owner Address: 9911 Pico Boulevard, Suite 1070 Los Angeles, CA 90035 Park Management Company: Safety Investment Company Park Management Company Address: P.O. Box 9325 Park Management Company Phone No: Ontario, CA 91761 Number Homesites: 257 Year Built: 1986 Number of Acres: 39.2 Vacant Homesites: 28 Assessor's Parcel Number: 0142-071-14 &40 Brief description of the property: This property is in good condition. This is a gated community and one of the newer, larger parks in the city. The site is rectangular with many intersecting concrete streets and a high percentage of open space. All homes are newer with wood-siding and small front yards which creates a feeling similar to that of a single family home subdivision. The immediately adjacent land uses include multi-family residential, a city park, Sequoia Plaza Mobilehome Park and railroad tracks. All basic services are within a one to five mile radius. Amenities: There is a 7,500 square foot clubhouse which contains a kitchen, billiard room, management office, craft/conference room, library/card room, meeting hall, exercise room, men's and women's restrooms, enclosed spa room, spa and pool equipment room and a storage room. There is a 500 square foot building divided for use as a maintenance shop and a laundry room. Adjacent to the clubhouse is a swimming pool. There is a large grassy area behind and to the side of the clubhouse with playground equipment and a full, lighted basketball court. There is a large RV storage lot. 01 MERIDIAN TERRACE MOBILEHOME PARK Agreement for Purchase and Sale In accordance with The London Group Mobilehome Park Conversion Feasibility Study dated November 30, 1993 Meridian Terrace Mobilehome Park was designated as a Category I park. Category I parks are those which were identified as being appropriate for resident ownership and/or control via a condominium or non-profit form of ownership. This park is most suitable to a non-profit acquisition and operating structure. Pursuant to prior Commission authorization and utilizing the standard form agreement prepared by Agency Counsel, an Agreement for Purchase and Sale (Agreement) was prepared for execution for the purpose of Agency acquisition of this property. Accordingly, the due diligence process was commenced and is completed. Due Diligence A comprehensive physical plant, legal and financial due diligence was conducted on this property. Inspections and document reviews were performed by industry professionals who specialize in their fields. These professionals include an MAI and State of California Certified General Real Estate Appraiser, Certified Public Accountants currently engaged by the Agency, City of San Bernardino Fire Department, State of California Registered Environmental Assessor and Scientists, State of California Certified Asbestos Consultant, City of San Bernardino General Building Inspector, Agency Counsel, State of California Registered Civil Engineers, State of California licensed General Engineering Contractor, and a State of California licensed Land Surveyor. Attached as Appendix I is a list detailing the documents and information requested of the seller for review. This list represents an ideal for seller provided documentation, although it is rare that all items listed can be obtained particularly on a property over ten years old. We received copies of construction plans and a preliminary soils investigation report from the seller. No other engineering or environmental inspections or reports were available. The property owner provided most of the other basic documents requested, and the due diligence was completed based upon the documents as provided as well as site inspections, review of official governmental records and reconstruction of documents as necessary. With respect to financial records enough information was made available to satisfactorily verify cash flow and expenses on this property as well as develop forward projections. These inspections and reviews were coordinated and the results jointly analyzed by The London Group and the respective service providers to determine whether any conditions exist which would warrant further investigation or cause the property to be not acceptable for acquisition by the Agency. n Due Diligence: • ALTA Survey • Appraisal • Audit Review • Auditors Income and Expense Projections • Environmental Assessment: Phase I and Asbestos/Lead Survey • Fire Safety Inspection • Legal Review • Physical Plant Engineering • Reserve Analysis • Structural Pest Inspection • Title 25 Inspection Findings and Recommendations The results of reports and other information received through the due diligence inspections and reviews indicate that other than nominal compliance issues and repairs there are no significant problems which should preclude acquisition of the property by the Agency. The physical plant engineering inspection recommends that several repairs be done. Some of the repairs are not listed as deferred maintenance but rather as items which if done would bring those areas identified into ideal conditions immediately or at a minimum should be funded through a reserve account as future capital improvement expenditures. Exceptions to this include items identified as being in non-compliance with HCD Title 25 specifications or other regulatory agencies and deferred maintenance work. These include minor electrical pedestal repairs estimated to cost $500, installation of missing space corner markers at $2,000, replastering spa at $1,485, clearing catch basin debris at $500, replacement of a section of the concrete pavement at $10,000 and miscellaneous repairs to the pool area restrooms at $2,400. These are all items which should be done now. In addition to those items recommended by the engineering inspection report the reserve analysis report recommends several repairs be done during the first year of operation. These include painting of clubhouse exterior wood work at $500 and repair of the RV storage lot asphalt at $4,150. The projected operating budget should cover any maintenance items needed and the reserve analysis report details appropriate reserve requirements for any significant repairs or replacements required in future years based upon current condition and estimated remaining useful life. As a condition of the Agreement the seller is required to provide a recently completed structural pest control inspection report on the property common area structures and facilities prior to closing and is responsible for any noted corrections/treatments. Repairs, rehabilitation and code compliance items will be either completed prior to close of escrow and/or an amount equal to the costs identified shall be withheld from seller at close of escrow. Additionally, initial capital reserve requirements as identified in the reserve analysis report shall be funded at close of escrow. Authorization to Proceed The London Group therefore requests that the Commission authorize proceeding with consummation of the transaction in accordance with Section 5 Paragraph 5.3 of the Agreement and Section 6, entitled "Conditions of Closing of Buyer", including, but not limited to, Paragraph 6.10 thereof, entitled "Financing". Said paragraph provides that the escrow closing is further conditioned upon having obtained satisfactory financing by the Agency for the actual acquisition of the property. This request for authorization to proceed is made subject to any remaining items of compliance and negotiation of those identified repair issues which shall be resolved to the satisfaction of Agency Staff, Agency Counsel and The London Group prior to closing. i MT/Nov13 NOTICE OF JOINT PUBLIC HEARING NOTICE OF JOINT PUBLIC HEARING TO BE HELD IN ACCORDANCE WITH SECTION 147 (f) OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED, BY THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN BERNARDINO, CALIFORNIA AND THE SAN BERNARDINO JOINT POWERS FINANCING AUTHORITY FOR THE ISSUANCE OF CERTAIN BONDS FOR THE ACQUISITION OF CERTAIN PROPERTY WITHIN THE CITY OF SAN BERNARDINO AND FOR THE COSTS ASSOCIATED THEREWITH Notice is hereby given that on December 4, 1995, at 11: 00 a.m. , or as soon thereafter as the matter may be heard, the Mayor and Common Council of the City of San Bernardino, California (the "Common Council") , on behalf of the City of San Bernardino, California (the "City") and the San Bernardino Joint Powers Financing Authority (the "Authority") , will conduct a hearing which shall be open to the public in the City Council Chambers, City Hall, 300 North "D" Street, San Bernardino, California 92418, for the purpose as hereinafter set forth. The purpose of said public hearing to be held in accordance with Section 147 (f) of the Internal Revenue Code of 1986, as amended (the "Code") , is to consider the Authority's authorization to issue certain tax exempt bonds in the amount not to exceed and for the purposes of acquisition of the following: A. Description: Meridian Terrace Mobile Home Park; mobilehome park comprised of 257 mobilehome spaces B. Maximum Estimated Proceeds: $5, 100, 000 C. Owner: Meridian Terrace, a California limited partnership D. Project Street Address: 243 North Meridian, San Bernardino, California 92410 f The proceeds of the Bonds shall be repaid from rental revenue derived from the Project. I All persons interested in the subject matter and the public purposes and the public benefits and the execution and delivery of .the Bonds may attend such hearing at the time and on i -1- the data as above eat forth and/or file their written oements thereto in the manner hereinafter set forth. Any person present at the hearing shall have the opportunity to be heard on the question of the Authority's authorisation to execute and deliver the proposed Bonds. Any arson who wishes to present written comments to be summarised at he hearing may do so by delivering the same to the attention of the City Clark at the City Clark's office at the City's address noted above, for receipt prior to the olose of the hearing. This notice is being given, and the hearing being held, pursuant to the requirements of Section 147 (!) of the coda. Dated: November 4, 1483 Sys ClarX, city Clar nn Authority Secretary aso�o�s�oocv u�aw u�s f I -2-