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City of Redwood City 6.1.D. - Page 79 <br />Notes to the Basic Financial Statements <br />For the fiscal year ended June 30, 2016 <br />NOTE 3 - LOANS RECEIVABLE (CONTINUED) <br />C. First Time Homebuyer Silent Loan Program <br />In 2000, the former Redevelopment Agency established a First Time Homebuyer Silent Loan Program. <br />Loans are deferred for the first five years, and then amortized at 4% interest over the remaining 25 years. <br />An Equity Participation requirement shares appreciation based on the amount of the Agency's original <br />loan amount. At June 30, 2016 there were outstanding loans to four homebuyers totaling $288,106. <br />D. Loans with Non -profits and For Profit Organizations <br />The City and former Redevelopment Agency loaned $500,000 to MP Redwood Court Associates and <br />$650,000 to Hallmark Apartments LLP. The MP Redwood Court Associates loan agreement was entered into <br />in July 2003 for the repair and rehabilitation of housing units. The loan term is 55 years and bears 0% <br />interest. The loan to Hallmark Apartments LLP has interest deferred for the first 30 years after which it <br />bears interest at 3% until the December 2058 maturity. The outstanding balance at June 30, 2016 was <br />$1,133,153. <br />E. Housing Rehabilitation Loans <br />The City and former Redevelopment Agency have outstanding loans for housing rehabilitation in the <br />amount of $1,474,513. <br />F. Shores Childcare Loan <br />The City entered into an agreement with Shores Childcare, LLC whereby $3,200,000 was loaned to Shores <br />Childcare, LLC for construction of a childcare facility on City -owned land in the Redwood Shores area. The <br />term of the loan is 20 years maturing January 2023, with interest payable quarterly and calculated based <br />on the quarterly rate of the State of California Local Agency Investment Fund plus 250 basis points. The <br />outstanding balance of the loan at June 30, 2016 was $1,205,478. <br />G. First Community Housing Loan <br />The City entered into an agreement with First Community Housing whereby $2,627,000 ($200,000 from <br />Community Development Block Grant, $1,927,000 from the former Redevelopment Agency low and <br />moderate housing fund, $500,000 pass-through from County of San Mateo) was loaned to First <br />Community Housing for construction of the Villa Montgomery housing development at EI Camino and <br />Vera Avenue. The portion of the loan attributable to the former Redevelopment Agency has been <br />transferred to the City's Low and Moderate Income Housing Asset fund. The loan bears interest at 3% for <br />40 years. The loan will be repaid annually from 70% of the project's net cash flow. The outstanding balance <br />of the loan at June 30, 2016 was $2,627,000. <br />H. Police Activities League Loan <br />In March 2006, the City paid off a construction loan in the amount of $1,500,000 that the Police Activities <br />League (PAL), a separate, private, non-profit agency, entered into with Bay Area Bank to partially finance <br />the construction of the new PAL community center at Taft School. The City Council and PAL agreed that <br />one-half of the amount, or $750,000, will be paid back to the City by PAL over a period of 15 years. The <br />outstanding balance of the loan at June 30, 2016 was $214,286. <br />52 <br />