AgdaPkt 2005-01-24 - Laserfiche WebLink

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~.A,4 c. The Agency will provide the Project with a "development loan" of $2.63 million. If it is determined that the Project will be required to pay pending water facility fees, then the development loan will be increased by up to $533,000 to $3.16 million. d. The development loan will be disbursed on a yet to be determined schedule only after FCH has obtained commitments for permanent debt, MHP funds, and tax credit equity sufficient to fund the project's development costs. FCH must provide the Agency with a firm construction contract and other documentation to the satisfaction of the Agency. If FCH is unable to secure sufficient financing to complete the Project without additional funding by the Agency, then the DDA will terminate, the property will not transfer to FCH, and FCH will not receive any cash assistance from the City. - e. The development loan of up to $3.16 million will carry a 3% interest rate and 40- year term. FCH will repay the development loan and annual interest from available annual net cash flow to be generated by the Project. The Agency will receive 70% of the Project's net cash flow for the term of the loan. It is estimated that the Agency's share of net cash flow will be sufficient to repay $3.16 million over the 40-year term of the loan. f. Subsidy funds currently available for the entire project are $2,594,911. Of this amount, $395,000 is being reserved for Peninsula Habitat for Humanity, leaving $2,199,911 available for FCH. The sources of these funds are $1,559,194 of Agency funds from fiscal year 2003/2004, $680,867 of Agency funds from fiscal year 2004/2005, and $354,850 of CDBG funds from fiscal year 2004/2005. The Agency proposes to bridge the subsidy gap of $960,089 by applying to the County of San Mateo CDBG 2005-06 process for $500,000. FCH is encouraged to apply for $250,000 through the City's CDBG process, and the remaining $210,089 may come from CCAG's Transit Oriented Development funds or from Agency set-aside funds for 2005-06. Accordingly, as noted previously, the Agency is requested to approve a resolution authorizing the submittal of an application to San Mateo County for these additional funds. The application for County funds was submitted January 18, 2005. In the DDA (Section 2.02 c. (4)) the Agency "agrees to use its best efforts to seek approval during the fiscal year 2005/06 budgetary process for additional funding of the Project as needed to provide funding of the Agency Assistance." If the applications for funding from the County, the City's CDBG program process and/or CCAG are not funded, the gap between the $960,000 and grant requests approved would need to be included in the Agency's Housing set-aside FY 2005/06 budget request. Staff will make every effort to secure the grants mentioned, as well as any other funds from sources not yet identified. However, the developer has been told that the Agency does not currently have the $960,000 needed to completely fund the development assistance requested. If grant funds in the amount required are not received, and the Agency Board must DJT:cje Redev Shared/2005 Staff ReportslO1-2005lFCH DDA 4