AgdaPkt 2019-12-16 Joint SA PFA - Laserfiche WebLink

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6.A. - Page 83 of 191 CITY OF REDWOOD CITY NOTES TO THE BASIC FINANCIAL STATEMENTS For the Fiscal Year Ended June 30, 2019 NOTE 3 — LOANS RECEIVABLE (CONTINUED) F. First Community Housing Loan The City entered into an agreement with First Community Housing whereby $2,627,000 ($200,000 from Community Development Block Grant, $1,927,000 from the former Redevelopment Agency low and moderate housing fund, $500,000 pass-through from County of San Mateo) was loaned to First Community Housing for construction of the Villa Montgomery housing development at El Camino and Vera Avenue. The portion of the loan attributable to the former Redevelopment Agency has been transferred to the City's Low and Moderate Income Housing Asset fund. The loan bears interest at 3% for 40 years. The loan will be repaid annually from 70% of the project's net cash flow. The outstanding balance of the loan at June 30, 2019 was $2,627,000. G. Police Activities League Loan In March 2006, the City paid off a construction loan in the amount of $1,500,000 that the Police Activities League (PAL), a separate, private, non-profit agency, entered into with Bay Area Bank to partially finance the construction of the new PAL community center at Taft School. The City Council and PAL agreed that one-half of the amount, or $750,000, will be paid back to the City by PAL over a period of 15 years. The outstanding balance of the loan at June 30, 2019 was $214,286. H. Kainos Home and Training Center Loan In 1989-90, the City entered into an agreement with Kainos Home and Training Center whereby $548,000 from Community Development Block Grant was loaned to acquire and rehabilitate property at 2555 Middlefield Road. In 2013-14, Kainos Home and Training Center sold 2555 Middlefield Road, and used the proceeds from the sale to purchase 2761 Fair Oaks Avenue. The current City loan is structured as a lien transfer of the original amount plus the shared equity of $437,722 from 2555 Middlefield Road to 2761 Fair Oaks Avenue, totaling $985,722. The loan bears no interest and is due and payable on March 29, 2039. In 1997-98, the City entered into an agreement with Kainos Home and Training Center whereby $57,500 from Community Development Block Grant was loaned to acquire property at 2033 Jefferson Avenue for Kainos Home and Training Center. The loan is deferred and payable upon the sale of the property, at which time the City would receive repayment of the loan plus any accrued equity based on the prorated City share. In 2010-11, the City entered into an agreement with Kainos Home and Training Center whereby $400,000 from the City's HOME and CDBG grant programs were loaned to acquire property located at 1122 Valota Road in Redwood City for special needs housing. The loan is deferred for a term of 55 years at 0% interest. In 2012-13, the City entered into an agreement with Kainos Home and Training Center whereby $450,000 from HOME grant was loaned to acquire property located at 1033 Redwood Avenue for special needs housing. The loan is deferred for a term of 30 years at 0% interest. The loans to Kainos Home and Training Center are intended to be forgiven upon maturity, and therefore, an allowance for uncollectible loans has been set up in the amount of $1,893,222. 55 90