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HomeMy WebLinkAboutItem No. 02 - Approving the Issuance of Bonds Public Hearing City of San Bernardino Request for Council Action Date: June 3, 2020 To: Honorable Mayor and City Council Members From: Teri Ledoux, City Manager By:Michael Huntley, Community & Economic Development Director Subject: Resolution of the Mayor and City Council Approving the Issuance of Bonds Recommendation It is recommended that the Mayor and City Council of the City of San Bernardino, California; 1. Conduct a public hearing under the requirements of TEFRA and the Internal Revenue Code of 1986, as amended; and 2. Adopt Resolution No. 2020-108 of the Mayor and City Council of the City of San Bernardino, California, approving the issuance of the California Municipal Finance Authority Multifamily Housing Revenue Bonds in an aggregate principal amount not to exceed $55,000,000 for the purpose of financing or refinancing the acquisition, rehabilitation, improvement, and equipping of Foothill Villas Apartments and certain other matters relating thereto. Background The Mayor and City Council are being asked to adopt a resolution that would approve the issuance of tax-exempt multi-family housing revenue bonds by Standard Foothill Venture LP, in one or more series in an aggregate principal amount not to exceed $55,000,000 (Bonds). The purpose of the Bonds is to finance the acquisition, construction and equipping of an existing 239-unit apartment complex, located at 2601- 2675 West 2nd Street, San Bernardino. The Bonds are limited obligations of Standard Foothill Venture LP payable solely by the borrower and will not be direct obligations of the City of San Bernardino. Discussion The purpose of the Tax Equity and Fiscal Responsibility Act (TEFRA) hearing is to receive public comment and request approval of the financing, as required by the Internal Revenue Code of 1986, as amended. The City Clerk has properly noticed this public hearing and legal counsel has assisted in the preparation of the attached resolution for approval. Page 1 6738 Before the Bonds can be issued as tax-exempt obligations, the City must conduct a public hearing and approve the issuance and use of the Bond proceeds pursuant to Section 147(f) of the Internal Revenue Code. The units will be affordable to households with income levels ranging from 30% to 60% of Area Median Income for a 55-year period. Approval of the bond issuance will meet Should the project require additional assistance, the City has budgeted $500,000 in HOME funds to assist with the rehabilitation in the form of a low interest, residual receipts loan. If the project requires the funds, approval of a HOME loan agreement would be brought before the Mayor and City Council for consideration, at a later date. 2020-2025 Key Strategic Targets and Goals Adopting the resolution for issuance of tax-exempt revenue bonds for the acquisition and rehabilitation of Foothill Villas, aligns with Key Target No. 3: Improved Quality of Life by rehabilitating existing rental housing and preserving that housing as affordable for 55 years. Fiscal Impact Adopting the resolution for issuance of tax-exempt revenue bonds by the California Conclusion It is recommended that the Mayor and City Council of the City of San Bernardino, California; 1. Conduct a public hearing under the requirements of TEFRA and the Internal Revenue Code of 1986, as amended; and 2. Adopt Resolution No. 2020-108 of the Mayor and City Council of the City of San Bernardino, California, approving the issuance of the California Municipal Finance Authority Multifamily Housing Revenue Bonds in an aggregate principal amount not to exceed $55,000,000 for the purpose of financing or refinancing the acquisition, rehabilitation, improvement, and equipping of Foothill Villas Apartments and certain other matters relating thereto. Attachments Attachment 1 Resolution No. 2020-108 Attachment 2 TEFRA Public Hearing Notice Ward: 3 Synopsis of Previous Council Actions: N/A Page 2 RESOLUTION NO. 2020-108 RESOLUTION OF THE MAYOR AND CITY COUNCIL OF THE CITY OF SAN BERNARDINO, CALIFORNIA, APPROVING THE ISSUANCE OF THE CALIFORNIA MUNICIPAL FINANCE AUTHORITY MULTI FAMILY HOUSING REVENUE BONDS IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $55,000,000 FOR THE PURPOSE OF FINANCING OR REFINANCING THE ACQUISITION, REHABILITATION, IMPROVEMENT AND EQUIPPING OF FOOTHILL VILLAS APARTMENTS AND CERTAIN OTHER MATTERS RELATING THERETO WHEREAS, general partner, has requested that the California Municipal Finance Auth adopt a plan of financing providing for the issuance of exempt facility bonds for a qualified residential rental project pursuant to Section 142(a)(7) of the Internal Revenue Code of 1986 (the om time to time, including bonds issued to refund such exempt facility bonds in one or more series from time to time, and at no time to exceed rehabilitation, improvement and equipping of a multifamily rental housing project located at 2601- WHEREAS, pursuant to Section 147(f) of the Code, the issuance of the Bonds by the Authority must be appr located within the territorial limits of the City; and WHEREAS, issuance of the Bonds under Section 147(f) of the Code; and WHEREAS, the Authority has requested that the City Council approve the issuance of the Bonds by the Authority in order to satisfy the public approval requirement of Section 147(f) of the Code and the requirements of Section 4 of the Joint Exercise of Powers Agreement Relating to the California Municipal Finance Authority, dated as of January 1, 2004 (the WHEREAS, pursuant to Section 147(f) of the Code, the City Council has, following notice duly given, held a public hearing regarding the issuance of the Bonds, and now desires to approve the issuance of the Bonds by the Authority. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SAN BERNARDINO AS FOLLOWS: SECTION 1. The foregoing recitals are true and correct and are incorporated herein by this reference. Resolution No. 2020-108 SECTION 2. The City Council hereby approves the issuance of the Bonds by the Authority. It is the purpose and intent of the City Council that this Resolution constitute approval of the issuance of the Bonds by the Authority, for the purposes of (a) Section 147(f) of the Code by the applicable elected representative of the governmental unit having jurisdiction over the area in which the Project is located, in accordance with said Section 147(f) and (b) Section 4 of the Agreement. SECTION 3. The issuance of the Bonds shall be subject to the approval of the Authority of all financing documents relating thereto to which the Authority is a party. The City shall have no responsibility or liability whatsoever with respect to the Bonds. SECTION 4. The adoption of this Resolution shall not obligate the City or any department thereof to (i) provide any financing to acquire or construct the Project or any refinancing of the Project; (ii) approve any application or request for or take any other action in connection with any planning approval, permit or other action necessary for the acquisition, construction, rehabilitation, installation or operation of the Project; (iii) make any contribution or advance any funds whatsoever to the Authority; or (iv) take any further action with respect to the Authority or its membership therein. SECTION 5. The officers of the City are hereby authorized and directed, jointly and severally, to do any and all things and to execute and deliver any and all documents which they deem necessary or advisable in order to carry out, give effect to and comply with the terms and intent of this resolution and the financing transaction approved hereby. SECTION 6. The City Council finds this Resolution is not subject to the California Environmental Quality Act (CEQA) in that the activity is covered by the general rule that CEQA applies only to projects which have the potential for causing a significant effect on the environment. Where it can be seen with certainty, as in this case, that there is no possibility that the activity in question may have a significant effect on the environment, the activity is not subject to CEQA. SECTION 7. Severability. If any provision of this Resolution or the application thereof to any person or circumstance is held invalid, such invalidity shall not affect other provisions or applications, and to this end the provisions of this Resolution are declared to be severable. SECTION 8. Effective Date. This Resolution shall become effective immediately. APPROVED and ADOPTED by the City Council and signed by the Mayor and attested by the Acting City Clerk this ___ day of __________ 2020. John Valdivia, Mayor City of San Bernardino Resolution No. 2020-108 Attest: Genoveva Rocha, CMC, Acting City Clerk Approved as to form: Sonia Carvalho, City Attorney Resolution No. 2020-108 CERTIFICATION STATE OF CALIFORNIA ) COUNTY OF SAN BERNARDINO) ss CITY OF SAN BERNARDINO ) I, Genoveva Rocha, CMC, Acting City Clerk, hereby certify that the attached is a true copy of Resolution No. 2020-___, adopted at a regular meeting held on the ___ day of _______ 2020 by the following vote: Council Members: AYES NAYS ABSTAIN ABSENT SANCHEZ _____ _____ _______ _______ IBARRA _____ _____ _______ _______ FIGUEROA _____ _____ _______ _______ SHORETT _____ _____ _______ _______ NICKEL _____ _____ _______ _______ RICHARD _____ _____ _______ _______ MULVIHILL _____ _____ _______ _______ WITNESS my hand and official seal of the City of San Bernardino this ___ day of ____________ 2020. Genoveva Rocha, CMC, Acting City Clerk NOTICE OF PUBLIC HEARING CITY COUNCIL OF THE CITY OF SAN BERNARDINO NOTICE IS HEREBY GIVEN that the City of San Bernardino Mayor and City Council will hold a public meeting on Wednesday, June 3, 2020 at 7:00 PM via portal at http://sanbernardinocityca.iqm2.com/Citizens/default.aspx to access the livestream for the meeting. The purpose of the hearing is to consider the following item: In accordance with Section 147(f) of the Internal Revenue Code of 1986 with respect to a proposed plan of exempt facility bonds for a qualified residential rental project pursuant to Section 142(a)(7) of the Code in one or more series issued from time to time, including bonds issued to refund such exempt facility bonds in one or more series from time to time, in an amount not to exceed $55,000,000 in aggregate princ acquisition, rehabilitation, improvement and equipping of a multifamily rental housing project; and (2) pay certain expenses incurred in connection with the issuance of the Bonds. The facilities are to be owned described below: Name: Foothill Villas Apartments Location: 2601-2675 W. 2nd Street, San Bernardino, California Number of units: 239 Maximum Bond Amount: $55,000,000 The Bonds and the obligation to pay principal of and interest thereon and any redemption premium with respect thereto do not constitute indebtedness or an obligation of the Authority, the State of California or any political subdivision thereof, within the meaning of any constitutional or statutory debt limitation, or a charge against the general credit or taxing powers of any of them. The Bonds shall be a limited obligation of the Authority, payable solely from certain revenues duly pledged therefor and generally representing amounts paid by the Borrower. Notice is further given that members of the public who wish to comment on the question of whether or not such multifamily housing revenue bonds should be issued, may participate in the following ways: 1) comments and contact information can be emailed to publiccomments@SBCity.Org by 4:30 P.M. the day of the scheduled meeting; 2) calling 909-384-5128 and leaving a recorded message, by 4:30 P.M the day of the scheduled meeting, not to exceed three minutes, which will be played during the public comment section of the agenda; 3) if you wish to make a comment during the public hearing a request to speak can be made by (a) emailing publiccomments@SBCity.Org or (b) calling 909-384-5128 and leaving a recorded message that specifically indicates a request to speak, by 4:30 PM the day of the scheduled meeting, and at the time of the requested agenda item, the City Clerk will place a phone call to the commenter and allow them to speak to the Mayor and Council via speaker phone during the live meeting for up to three minutes. Please indicate on which item you wish to speak and include your name and telephone number. Additional information concerning the above matter may be obtained from, and written comments should be addressed to, City Clerk, City of San Bernardino, 201 North "E" Street, Building A, San Bernardino, California 92401. DATED: May 22, 2020