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From: Kenneth J. HeOOerson, Director
'D-ot: O:Jmmuni.ty Devel~lt
C~ July 27, 1988
UEST FOR COUNCIL ACTION
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S" bject: COB:; FIlJl>.T IOl\N :FOR SHOPPING
CENI'ER AT lWlELlNE ::;'=J.' AND
MEDICAL CENI'ER mIVE
Synopsis of Previous Council action:
On FebruaJ:y 29, 1988, the Mayor aIXl C..... '1 011ncil adq;lted a resolution
requestin:J that the Ocunt:y of san Bernardino loan a porticn of its t'hmurdty
Devel~lIl!lllt Block Grant for devel~lt of a shqlpiIq center at Baseline SL..eet
aIXl Medical center Drive.
On July 8, 1988, the Mayor aM C....... 011ncil, at an adjc:umed regular meetin],
set a date for the ClClIlChIct.ing of a aD; plblic Ilearizq for shq;piIq center at
Baseline SL......t aM fo'Mi....' center Drive.
On vario.Js occasials, the Mayor aM n .....Jrl 011ncil azxvor t'hmuruty Devel~lt
o:mni.ssicn has ocnfucted close sessials pursuant to cov-...-.t, o:lde Sect.icn
54956.8 in OOIlhEoCticn with the ~i<cpositicn of real. l'L"l'""Lty qenetally located at
Baseline SL.....:t: aIXl fo'Mi ....1 center Drive.
Recommended motion:
OPEN IUBUC HFARIH;
CLOSE IUBUC HFARIlI;
Adept Resolutian
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Contact person:
Ken Hendersa1
Phone:
5065
Supporting dlltll ettached:
staff Repo1l
Ward:
6
FUNDING REQUIREMENTS:
Amount:
$1,250,000
Source: (Acct. No.1 JIlD letter of Credit
(Acct. Descriotionl F'i 88/89 aD; Allocaticn
Finence:
Council Notes:
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75-0262
Agenda Item No
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J:?-/n
. CI1'O OF SAN BERNARDIO - RIEQUEQ- FOR COUNCIL AC~N
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STAFF REPORT
In mid 1986, ChmInU.ty Devel~lt staff develqlEld and subnittecl to JIJD an
application far Urllan Devel~Jt Acticn Grant funds far the 0XlStructicn of a
~in:] center at Baseline street and Medical Center Drive. 'Ibe BIPlicatien was
subsequently f\m:Jed by JIJD and wrIt began in earnest en the project in quest.icn.
'Ibis report Sl.lIIIIIlIrlze the a......el4. status of the project and sets forth the met:hcd
of financ:in;J and participatin;J parties r--"llry to brin;J the project to fruition.
At preS5!1rt:, the sam:leS of financin:J and particl.patin;J entities are as follows:
e
$ 1,834,999
$ 2,000,000
$ 1,325,000
$ 500,000
$ 2,750,000
$ 1,250,000
S 861. 000
$10,520,000
'Ibe develqlE!r has CCIlIIIittecl to a private loan of $4,861,000 at eight point five
pm:cent (8.M) interest far a tem of thirty (30) years. 'Ibis equates to an lln1'IIlal
debt service of $448,670. 'Ibe city, Cbmty and Rr:lP. participation equals $4,861,000
and waild be in the fom of noat loans bearin:] interest rates of cne pero...it (It),
t:hrM pet.......L (3') and zero peroelit (ot), respec:t:ively. . ---- nOl!li~t loansll-. wii:ll be
........Jred bIT AA rate hAnk lllOH-....... of t'!T'IOt'Iit ~ch will be ~:. !:!!. 1ML.-1m!:m
demand. t'li.-..r+ DaY obliaaticns of the bank. said letters of CI9dit are obtained by
the develqlE!r.
'Ibis last point is hportant iruo......m. as the develc:per-dJt:ained letters of credit
make the $4,861,000 another fom of private financ:in;J. It is also hportant to note
that alt:hcugh the source of financin:J is plblic, the risk is private. (ShcW.d the
project not FllXeed, the city, Cbmty and Agercy wwld be J:epaid by the letters of
credit and the develqlE!r on the hook far $4,861,000.)
Urllan Devel~it Acticn Grant:
Rr:lP. Tax Allocation BcIld:
Rr:lP. Iand Acquisition:
DevelqlE!r Equity:
Cbmty Float Loan:
city Float Loan:
Rr:lP. FlClllt Loan:
'Ibe Float loan Reserve will eam $744,460 over a t:hrM (3) year period. A partien
of the FlClllt Reserve, $203,000, will be used to pay down the Rr:lP. FlClllt Loan leavin:]
a Rr:lP. Float Loan balance of $658,000, and a FlOat Loan Reserve balance of $541,730.
Together the balarxles equal $1,200,000 \Ihich is used to bridge the gap between the
develqlE!r's pezmanent loan of $3,661,000 and the total amamt r--....ry far
permanent financin:] $4,861,000. 'Ibe interest rate, not incidental1y, is eight point
five pm:cent (8.5'), the rate the develqlE!r has always maint:ained is r--"sry to
make the project a "'~".
'lhe City and Cbmty are repaid their respective noat loans, with interest, at the
ern of t:hrM (3) years when permanent financ:in;J is acquired. 'lhe Redeve1'+w=tit
Aqercy tax allocation Ixn:l is repaid t:hrc:J.Jgh tax :ina:E!lu=ut generated by the
Northwest Redevel"'1o'"",it Project Area, and the Rr:lP. float loan is repaid by the debt
service on the permanent financi1q.
I reo .,.,-td adqltion of the attached resolution.
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Kehneth J.
Director of ChmInU.ty
75-0264
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RESOLUTION NO.
RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF
SAN BERNARDINO APPROVING A LOAN OF A PORTION OF INTERIM COMMUNITY
DEVELOPMENT BLOCK GRANT FUNDS FOR THE BASELINE/MEDICAL CENTER
DRIVE PROJECT.
WHEREAS, there is proposed a development in the City of San
Bernardino known as the Baseline/Medical Center Drive Shopping
Center; and
WHEREAS, such development is critical to the economic
improvement of the west side of the City of San Bernardino; and
WHEREAS, in developing said project there is a need for
additional financing;
WHEREAS, the Community Development Block Grant Fund loan
program may be used for such development financing; and
NOW, THEREFORE, BE IT RESOLVED BY THE MAYOR AND COMMON
COUNCIL OF THE CITY OF SAN BERNARDINO AS FOLLOWS:
The City of San Bernardino hereby approves a Community
Development Block Grant Fund loan in an amount not to exceed
$1,250,000 for a term of three (3) years at an interest rate of
one percent (It) to Alexander Haagen Development Corporation for
a shopping center to be developed at Baseline Street and Medical
Center Drive in a cooperative effort to provide economic
improvements to the west side of the City of San Bernardino.
I HEREBY CERTIFY thai:: the foregoing resolution was duly
adopted by the Mayor and Common Council of the City of San
Bernardino at a
meeting thereof, held on
, 1988, by the fOllowing
the
day of
1
. 0 0 0 0
1
. 2 vote, to wit:
0 3 AYES: Council Members
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5 NAYS:
6 ABSENT:
7
8 City Clerk
9 The foregoing resolution is hereby approved this day
10 of , 1988.
11
12 EVLYN WILCOX, MAYOR
13 City of San Bernardino
14 Approved as to form
C" 15 and legal content:
l~h
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17 <;4-ty Attorney
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