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CIY' _ OF SAN BERNARDU ) - REQUEf T FOR COUNCIL ACT IN
From:
Kenne th J. Henderson, Di rlftEfO. _ AD l~ li'L OSr.~!ect:
Restructuring of Belco Development
Company Loan Agreement
~~
Dept:
Community Development
IS87 JAN - 8
O!l 3: L'"' no'
~ t.!
Date:
January 7, 1987
Synopsis of Previous Council action:
In September and October of 1983, the Mayor and Common Council approved three (3) Disposition
and Development Agreements (DDA's) for $63,000, $77,000 and $25,000, respectively.
In October 1985, the Mayor and Common Council approved the restructuring of the three (3) DDA's
into one (1) loan agreement totaling $187,458.34 (principal plus accrued interest).
In January 1986, a Declaration of Default Status for the Belco loan agreement was brought before
the Mayor and Common Council. The item was tabled inasmuch as Belco made payment of the total
amount in arrears immediately prior to January 21, 1986 Council meeting.
On November 17, 1986, a second Declaration of Default Status item was brought before the Mayor
and Common Council. The matter was continued to December 8, 1986.
On December 8, 1986, staff informed Council Belco had brought its account current and had submitted
a request to restructure its loan agreement. The matter was contined to December 22, 1986 and again
to J3nuary ~~7.
RecommenrJed motion:
Move to continue consideration of restructuring of Belco Development Company
Community Development Block Grant to February 2, 1987
Contact person:
Ken Henderson/Lisa Dickey
Phone: 383-5065
Supporting data attached:
S~aff Report
Ward:_L____n_ ____~
FUNDING REQUIREMENTS:
Amount:
N/A
Sou rce:
Finance:
Council Notes:
1/19/87 Council Mtg.
75.0262
Agenda I tem No, 3,
Cl't.... OF SAN BERNARDI'''~ - REQUE"'-T FOR COUNCIL ACT IN
STAFF REPORT
On November 17, 1986, a Declaration of Default Status item
was brought before the Hayor and Common Council concerning
the Belco Development Company Community Development Block
Grant (CDBG) loan agreement. At that time, Belco was six (6)
months in arrears on its monthly payments of $1,247.17 per
month. The matter was continued to December 8, 1986 Council
meeting and during the intervening period of time, Belco
brought its account current. At the December 8, 1986 meet-
ing, the Mayor and Common Council considered a request from
Belco to restructure its loan agreement a second time (the
Mayor and Common Council had previously approved a restruc-
turing of the loan agreement in October 1985). The matter
was continued to January 5, 1987.
In response to Belco's request to restructure its loan
agreement, staff sent two letters to the principals of Belco
requesting certain information in order that staff might
properly analyze-Belco's request (letters attached as "A" and
"B"). On January 6, 1987, the requested information was
hand-delivered to the Community Development offices. Irr view
of the fact the agenda deadline for the January 19, 1987
Council meeting is January 8, 1987, there is not enough time
for staff to properly analyze the request to restructure the
loan agreement in question. Therefore, staff recommends this
matter be continued to February 2, 1987.
The Mayor and Common Council should also be aware that as of
this date (January 6, 1987) loan payments for the months of
December 1986 and January 1987 have not been received.
G.
rector
partment
KJH/ lab
file: belcolnstaffrep
75.0264
/-7-' ,7
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I .
CITY OF SAN BERNARDINO 300 NORTH "0" STREET, SAN BERNARDINO, CALIFORNIA 92418
RAYMOND D. SCHWEITZER
ACTING CITY ADMINISTRATOR
December 9, 1986
William Collazo
Belco Development Company
739 North Mt. Vernon Avenue
San Bernardino, CA 92411
Re: COMMUNITY DEVELOPMENT BLOCK GRANT
LOAN RESTRUCTURING REQUEST
Dear Mr. Collazo:
On December 8, 1986, pursue.nt to Councilwoma~ Esthc: Est:3G2':
request, the Mayor and Cornmon Council authorized Community Develop-
ment staff to pursue the possibility of restructuring the Belco loan
agreement. Staff's findings would then be presented to the Mayor and
Common Council for their consideration.
In order to facilitate the timely accomplishment of this assignment,
you are requested to provide the following information for staff's
review and analysis:
1. Pro forma showing current revenues and operating costs,
including maintenance.
2. Current and projected cash flow analyses.
3. Difference between market rents and Belco's current
lease agreements.
4. Current maintenance costs versus the "market norm".
5. Any other pertinent documentation that will substantiate
the need for loan restructuring.
You are encouraged to submit the above requested information as soon
as possible. Shortly after receiving this information, staff will
schedule a meeting to discuss the matter of loan restructuring.
ItA It
I .
Belco Development Company
December 9, 1986
Page -2-
Additionally, our records indicate that your December loan payment
has not yet been received. Please be advised that loan payments must
remain current in order to avoid entering into default proceedings.
Should you require additional information or clarification, please
call Lisa Dickey of my staff at 714/383-5065.
~cerelYt
Ke~. H~Director
Community Development Department
cc: Esther Estrada, Councilwoman, FIRST WARD
Lisa Dickey
File
KJH/LRD/lb
file: Itrbelcodevel.
..
CI
ERN ARD IN 0 300 NORTH "0" STREET, SAN BERNARDINO, CALIFORNIA 92418
RAYMOND D. SCHWEITZER
ACTING CITY ADMINISTRATOR
December 30, 1986
William Collazo
Be1co Development Company
739 North Mt. Vernon Avenue
San Bernardino, Calif. 92411
Re: COMMUNITY DEVELOPMENT BLOCK GRANT
LOAN RESTRUCTURING REQUEST
Dear Mr. Collazo:
On December 9, 1986, a letter was sent to you requesting information
that would support your request for loan restructuring. To date, no
response has been received.
This matter had been placed on the Council agenda for December 22, 1986
and continued to the January 5, 1987 Council meeting, in anticipation
of receiving the information requested and being able to present a
recommendation to the Mayor and Common Council.
Because of the time needed by staff to analyze the information and the
fact that agenda items for Council meetings must be submitted eleven
(11) days prior to the Council meeting the item is scheduled for, it is
important the information requested be submitted as soon as possible.
You are encouraged to respond by no later than Wednesday, January 7,
1987, in order to meet the deadline of January 20, 1987, for agenda
items to be considered on February 2, 1987.
JIB"
William Collazo
December 30, 1986
Page -2-
Should this present a problem or should you have any questions
regarding this matter, please call Lisa Dickey at 383-5065.
1:;i~.
Kenneth J. ~, Director
Community Development Department
cc: Esther Estrada, FIRST WARD
Lisa Dickey
File
KJH/LRD/lb
File: letterbelcocomp