AgdaPkt 2008-01-07 - Laserfiche WebLink

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REPORT 6.3C Page 1 To the Honorable Mayor and City Council and the RedeveJ()prnent Agency Board . Frgm the EX~QlIt."eDirector January 7, 2008 SUBJECT Certificate of Completion for Villa Montgomery - First Community Housing RECOMMENDATION That the Agency: (1) Approve by Resolution, a Certificate of Completion for Villa Montgomery, and {2} Authorize by Motion, the Redevelopment Agency Executive Director to execute all documents pertaining thereto. BACKGROUND On March 31,2005, the Council and Agency Board approved, by Resolution No. 14624 and RD 05-01 respectively, an Amended and Restated Disposition and Development Agreement (DDA) with First Community Housing (FCH) for the development of 58 affordable multifamily housing units. The DDA stipulated that the Agency provide monetary assistance in the form of a loan for the amount of $2,627,000 to be used for project development. Accordingly, the Agency also approved Resolution No. RD 05~02 which authorized staff to submit an application to the County of San Mateo for $500,000 to partially fund the project construction. The City was subsequently awarded $500,000 in funding from the County. Additionally, the Housing and Human Concerns Committee recommended and the Council approved $200,000 in Community Development Block Grant funding in the Annual Action Plan for 2005-2006. Funds from these sources provided $700,000 of the Agency's $2,627,000 commitment as stated in the DDA. The total development and construction cost was approximately $39,522,819. Because Redevelopment funds were used, the units are required to remain affordable for 55 years. FCH told the Housing & Human Concerns Committee (HHCC) that if the City assisted in the construction of the units, they would provide 49% of the units affordable to households earning 50% of the Area Median Income and below. The development loan is secured by a recorded DDA and promissory note naming the City and Redevelopment Agency and their respective interests. The note provides that the loan will accrue at 3% simple interest and have a term of 40 years. The note shall be repaid on an annual basis, from 70% of the project's net cash flow. In addition to the $2,627,000 loan for project development, the City and Agency also provided a land grant valued at $1,350,000. The State of California Multi-family Housing Program (MHP) funds provided a first mortgage of $5.6 million to create rents that are affordable to households earning 20% and 40% of median income.