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HomeMy WebLinkAboutCC Resolution 7945 (Crest Marin II)JiiFITUJ I.Pth 64 1JG848 RESOLUTION NO. 7945 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN RAFAEL PROVIDING PRELIMINARY APPROVAL OF THE ISSUANCE OF BONDS FOR THE PURPOSE OF PROVIDING MULTIFAMILY RENTAL HOUSING, AND AUTHORIZING EXECUTION AND DELIVERY OF A DEPOSIT AND ESCROW AGREEMENT AND APPLICATION FOR PRIVATE ACTIVITY BOND ALLOCATION IN CONNECTION THEREWITH CREST MARIN II WHEREAS, the City of San Rafael (the "City") is authorized pursuant to Section 52075 et seq. of the Health and Safety Code of the State of California (the "Act") to issue and sell its bonds for the purpose of providing financing for the acquisition and construction of multifamily rental housing located in the City; and WHEREAS, Northbay Properties II, L.P., a California limited partnership (the "Company") has requested that the City or the Housing Authority of the County of Marin (the "Authority") issue and sell bonds for the purpose of providing financing for the acquisition of land and construction thereon of an approximately 220 -unit multifamily rental housing development to be located in the City on an approximately 8.5 acre site consisting of Marin County Assessor's parcel numbers 155-251-20, -21, -24 and -25 (the "Project"), and the City wishes to induce the Developer (as defined below) to acquire and construct the Project and, in particular, to do so at such location; and WHEREAS, the City intends to cooperate with the Authority in the issuance of bonds to finance the Project and that the Authority ultimately be the issuer of the bonds, but the City desires to preliminarily approve the issuance of bonds for the Project at this time in order to assist the Company in applying to the California Debt Limit Allocation Debt Committee (the "CDLAC") and the Mortgage Bond and Tax Credit Allocation Committee of the State of California (the "MBTCAC") to obtain a portion of the State's private activity bond volume limit for the Project; and WHEREAS, it is in the public interest, for public benefit and in furtherance of the public purposes of the City that the City Council provide preliminary approval of the issuance of bonds for the aforesaid purposes; NOW, THEREFORE, BE IT RESOLVED: 1. That the City Council hereby preliminarily approves the issuance and sale of bonds of the City of San Rafael pursuant to the Act in a principal amount of not to exceed $22,500,000 for the purpose of providing financing to the Company or an entity affiliated therewith or a successor in interest thereto (the "Developer") for the acquisition, construction and development of the Project. The City hereby intends that the Authority ultimately be the issuer of the bonds for the Project, and intends to cooperate with the Authority to that end. 2. That the City Council hereby determines and orders that the Mayor, the City Manager and such other persons as necessary shall take all action necessary or advisable in connection with the issuance and sale of the bonds and the execution of the financing agreements for the Project, including making the required application to CDLAC and/or MBTCAC for an allocation of a portion of the private activity bond limit of the State of California. The City Council hereby specifically authorizes and directs the City Manager to execute and deliver, for and in the name of the City, a Deposit and Escrow Agreement with the Company in the form on file with the City Clerk, or with such changes as the City Manager, upon consultation with Bond Counsel for the financing, shall determine are necessary or appropriate, and to execute and deliver all forms required by CDLAC or MBTCAC to obtain a portion of said bond limit for the Project. 3. That the bonds shall be special obligations of the issuer thereof payable solely from the trust estate to be defined in the indenture authorizing the bonds, and shall not in any event constitute an indebtedness of the City or a loan of credit thereof within the meaning of any constitutional or statutory provisions. 4. That the issuance and sale of the bonds shall be upon such terms and conditions as may be mutually agreed upon by the issuer of the bonds (being either the City or the Authority), the Company and the purchasers of the bonds and shall be subject to completion of proceedings for issuance, sale and delivery of the bonds by the issuer of the bonds. 5. That the proceeds of the bonds shall include such related and necessary issuance costs, administrative expenses, debt service reserves and interest payments as may be required to accomplish the financing successfully. 6. That the City Council hereby finds that the issuance of the bonds as described herein is a substantial inducement to the Developer to acquire, construct and develop the Project within the City and that the Project will further the public purposes of the City. 7. That all actions heretofore taken by the officers and agents of the City with respect to obtaining an allocation from the State for the issuance of the bonds are hereby approved, confirmed and ratified, and the Mayor, City Manager and any and all other officers of the City are hereby authorized and directed, for and in the name and on behalf of the City, to do any and all things and take any and all actions and the execution and delivery of any and all certificates, requisitions, agreements which they, or any of them, may deem necessary or advisable in order to consummate the lawful issuance and delivery of the bonds. 8. That this resolution shall take effect from and after its adoption. -2- I, JEANNE M. LEONCINI , Clerk of the City of San Rafael, hereby certify that the foregoing resolution was duly and regularly introduced and adopted at a regular meeting of the Council of said City on Monday , the 17t1aay of April , 1989, by the following vote, to wit: AYES: COUNCILMEMBERS: Boro, Breiner, Frugoli, Thayer & Mayor Mulry& NOES: COUNCILAJEMBERS: None ABSENT: COUNCILMEMBERS: None City Crk, City of San Rafael -3- DEPOSIT AND ESCROW AGREEMENT This Deposit and Escrow Agreement (the "Agreement"), by and between the City of San Rafael (the "Public Agency"), and the entity listed as the developer in Schedule A attached hereto and by this reference incorporated herein (the "Developer"), WITNESSETH WHEREAS, the Developer has requested that the Public Agency obtain an allocation from the State of California to issue multifamily housing revenue bonds (the 'Bonds'), the interest on which would be excluded from gross income for federal income tax purposes to assist in the financing of the project described in Schedule A (the "Project"); and WHEREAS, the Bonds are characterized as "Private Activity Bonds" under applicable sections of and are subject to the volume limitations contained in Section 146 of the Internal Revenue Code of 1986, as amended (the "Tax Code"); and WHEREAS, pursuant to Section 8869.80, et seq., of the California Government Code (the "Code"), the California Debt Limit Allocation Committee ("CDLAC") has been allocated the entire amount specified by Section 146(d) of the Tax Code for the State of California (the "Volume Limit") for 1989; and WHEREAS, CDL_kC, acting in concert with the Nfortgage Bond and Tax Credit Allocation Committee of the State of California ('11IBTCAC") has established procedures to be followed by local agencies in California to obtain a portion of the Volume Limit for specific financings; and WHEREAS, such procedures require that, in order to obtain a portion of the Volume Limit for the financing for the benefit of the Developer described in Schedule A, in addition to other requirements, the city manager or county administrative officer, as applicable, must collect from the Developer and hold on deposit in an escrow account specifically established for such purpose an amount equal to 1% of the principal amount of Bonds expected to be issued; and WHEREAS, the Public Agency and the Developer desire to set forth the terms and conditions under which said amount will be deposited and held in escrow. NOW, THEREFORE in consideration of the premises and for other consideration the receipt and sufficiency of which is hereby acknowledged, the parties hereto do hereby agree as follows: Section 1. Deposit and Escrow Account; Initial Application Fee. By its execution of this Agreement, the Public Agency acknowledges receipt of the deposit from the Developer, in the form of cash, in an amount equal to 1% of the principal amount of Bonds shown in Schedule A (the "Deposit'), along with a cashier's check in the amount of $300 made out to CDLAC (the 'Initial Application Fee"). The Deposit shall be held and drawn upon by the Public Agency solely in accordance with this Agreement, the Code, the procedures of CDLAC and MBTCAC and the laws of the State of California. The Initial Application Fee shall be forwarded to CDLAC along with the application of the Public Agency to CDLAC for a portion of the Volume Limit for the Project, and shall be nonrefundable in any event. Section 2. Disposition of the Deposit. The Deposit shall be disposed of as follows: (A) If the Project fails to receive any portion of the Volume Limit by October 1, 1989, the Public Agency shall, promptly upon receiving confirmation thereof and written permission to release the Deposit from CDLAC, return the Deposit to the Developer. (B) If the Project receives a portion of the Volume Limit by October 1, 1989 in an amount less than the principal amount of Bonds requested, a pro rata portion of the Deposit promptly may be, upon receipt of written notification thereof from CDLAC and written permission to release the Deposit, (i) reduced by the Developer and the balance of the Deposit shall be retained by the Public Agency, subject to paragraph 2(C) below, or (ii) at the Developer's election, it may petition CDLAC for written permission for the Public Agency to return the Deposit in full to the Developer. If such permission is granted by CDLAC, the Public Agency shall withdraw its application to CDLAC. If the Project receives a portion of the Volume Limit in an amount equal to the principal amount of Bonds requested, the entire Deposit shall be retained by the Public Agency, subject to paragraph 2(C) below. (C) Any portion of the Deposit retained by the Public Agency pursuant to paragraph 2(B) shall be disposed of as follows: (i) If the Bonds are issued by the Public Agency, the deposit may be reduced by the Developer upon written permission of CDLAC in an amount equal to the product of (1) the amount of the Deposit, times (2) the ratio between the amount of Bonds issued divided by the amount of Volume Limit received. The balance of the Deposit shall be drawn upon in full by the Public Agency and the proceeds of such draw shall be disposed of in accordance with the rules promulgated by CDLAC as they pertain to proceeds of the Deposit. (ii) If no Bonds are issued prior to the expiration of the Volume Limit allocation, the Deposit shall be drawn upon in full by the Public Agency and the proceeds of such draw shall be disposed of in accordance with the rules promulgated by CDLAC as they pertain to proceeds of the Deposit. (iii) Notwithstanding the above, all or a portion of the Deposit which otherwise would be drawn upon by the Public Agency under subparagraph (i) or (ii) above may be released if the Public Agency receives written notification or confirmation from CDLAC that such release may be made without liability on the part of the Public Agency. -2- Section 3. Volume Limit. The Developer understands that if the Project receives a portion of the Volume Limit, such allocation will be subject to the Code and any rules promulgated by MBTCAC and/or CDLAC pertaining to the allocation of the Volume Limit. The Developer further understands that any Volume Limit allocated to the Project by CDLAC will expire on a certain date, and if Bonds have not been issued by such expiration date the Deposit will be drawn upon by the Public Agency as provided in paragraphs 2(B) and (C) above. Section 4. Issuance of Bonds. The Developer understands that neither the execution of this Agreement nor the acceptance of the Deposit by the Public Agency and application to CDLAC for an allocation of the Volume Limit for the Project by the Public Agency, in any way obligates the Public Agency to issue the Bonds, said issuance being expressly contingent upon the negotiation and approval by the Public Agency of documentation for the financing acceptable to it in its sole discretion, The Public Agency intends to cooperate with the Developer in issuing the Bonds, but is in no way obligated to effect said issuance on terms other than as are fully acceptable to the Public Agency. Section 5. Public Agency Not Liable. Notwithstanding any breach of the terms of this Agreement by the Public Agency or the occurrence of any other event, in no event shall the Public Agency be liable to the Developer hereunder for any amount in excess of that portion of the Deposit to be released to or reduced by the Developer under the terms of Section 2 hereof. Section 6. No Estoppel. This Agreement shall not create any estoppel of the Developer with respect to any claim or right which the Developer may have against CDLAC or MBTCAC with respect to any release or reduction of the Deposit. Section 7. Assignment. The Developer shall have no right to assign this Agreement or the benefits hereof to any other entity. Subject to the provisions of the Code and any regulations of CDLAC or-NIBTCAC, the Public Agency may assign this Agreement to another public agency qualified to issue the Bonds. It is hereby acknowledged that it is expected that the Housing Authority of the County of Marin (the "Authority") will be the issuer of the Bonds, and that the City has assigned any allocation of the Volume Limit received in connection with the Project to the Authority. Section 8. Counterparts. This Agreement may be signed in counterparts with the same effect as if the signatures thereto were upon the same instrument. —3— IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date set forth alongside of their signatures below. CITY OF SAN hAFAEL (the "Public Agency") Date of Execution and Receipt of the By: Deposit by the Public Agency: City A&nager April 17 ,1989 ATTEST: By: J ne M. Leon ini, City Clerk NORTHBAY PROPERTIES II, L.P. (the "Developer") Date of Execution by the Developer: By: Ow Kep�� (9ft jA (2_ a ?-i , 1989 (DA o,.,,► ,amu 1 t.�, ; � a' ray a e � p , �, • � ��'Pat*d� gy : K 1 •^'ab" QL �, miPT— •p.r+v,vwe,�je Dal #-•++ �t& M, p �r OOvaJJPm f 4�cro oa •DaJ.4•+Ml.c Gle pu4ai�^^ y: " . AG Its: v Developer (insert exact legal name of the Northbay Properties II, L.P., a California developer): limited partnership Project (insert project description including name: Crest Marin II; name and location, number of units): approximately 8.5 acres located east of Highway 101, north of Smith Ranch Road, at the end of Cresta Drive (AP#'s 155-251- 20, 21, 24 and 25) # of units: 220 Principal Amount of Bonds Requested: $22,500,000 J6844 M2