65A - AMCAL INCLUSIONARY FEES - Laserfiche WebLink

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Proposal with AMCAL Multi- Housing, Inc. April 19, 2016 Page 4 - Developer's Proposal — The City Assistance will be made in the form of a residual receipts loan made to AMCAL which shall (i) have a term of 55 years, (ii) accrue simple interest at 3% per annum, (iii) be repayable from 50% of project cash flow, and (iv) be documented using the City's standard form of residual receipts loan documents and regulatory agreement. City Response — The City's standard practice is residual receipt loans with 3% interest and 50% repayable from the project cash flow. - Developer's Proposal — No deferred Developer Fee during the permanent period of the Project. City Response — Under the California Tax Credit Allocation Committee regulations, the proposed Project qualifies for a Developer Fee of up to $2.0 million. However, it is important to note that only $1.4 million of the Developer Fee can be included in the Project's eligible Tax Credit basis. In some cases, it would be financially prudent to require the Developer to defer payment of $600,000 of the Developer Fee, and to recoup those funds from the cash flow generated by the Project over time. To test this concept, KMA prepared pro forma analyses for the Project with and without the requirement that $600,000 of the Developer Fee be deferred. The results of this comparative analysis indicate that given tiebreaker considerations associated with the competitively awarded 9% Tax Credits, the financial gap is approximately equal under both scenarios. As such, it is KMA's recommendation that no Developer Fee deferral be required. On March 28, 2016, the Planning Commission considered the draft mitigated negative declaration (MND) for the First Street Apartments and unanimously approved a recommendation to the City Council for the following actions: (1) Approve and adopt the MND and Mitigation Monitoring Program Environmental Review; (2) Adopt a resolution approving a General Plan Amendment; and (3) Adopt an ordinance approving Amendment Application. City Council will conduct its first reading of the First Street Apartments Project and recommended actions on April 19, 2016 with the second reading on May 3; 2016. Project Description AMCAL Multi- Housing, Inc. (Developer) was founded in 1978 as an affordable housing developer with its headquarters in the city of Agora Hills, California, and an Orange County office in the city of Irvine. The Developer specializes in high - quality, service and amenity- enriched housing for families and seniors at all ranges of the economic spectrum, from special needs to homeownership. The Developer has a successful track record with over 4,827 affordable rental and for -sale units. The Developer has completed one project in the City of Santa Ana known as Vista Del Rio prior to the submission of its new proposal. The Vista Del Rio project is a 41 -unit new construction rental project that serves developmentally disabled persons, located at 1600 W. Memory Lane and completed in August 2014. The Vista Del Rio project utilized Redevelopment -owned land and funding from the HOME program ($1,500,000) and three (3) Redevelopment loans (totaling 65A -4