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Home My WebLink AboutItem 42 - Tax Equity Fiscal Responsibility Act (TEFRA) Hearing for First Point I Apartments and Approve TEFRA Resolution Community Development Agency santa-ana.org/cd Item # 42 City of Santa Ana 20 Civic Center Plaza, Santa Ana, CA 92701 Staff Report December 20, 2022 TOPIC: Conduct a Tax Equity Fiscal Responsibility Act (TEFRA) Hearing for First Point I Apartments and Approve TEFRA Resolution AGENDA TITLE: Conduct a TEFRA Hearing for the First Point Apartments I and Accept a Resolution Approving the Issuance by the California Municipal Finance Authority of Exempt Facility Bonds for a Qualified Residential Rental Project RECOMMENDED ACTION 1. Conduct a Tax Equity and Financial Responsibility Act Hearing in consideration of the issuance of tax exempt bond financing by the California Municipal Finance Authority (the “CMFA”) on behalf of the Santa Ana Pacific Associates, L.P. to finance or refinance the acquisition, construction, improvement and equipping of First Point Apartments I, a multifamily rental housing project located at 2114 E. 1st Street, Santa Ana, California (the “Project”). 2. Adopt a resolution approving the issuance of revenue bonds by the CMFA in an amount not to exceed $123,000,000 for the purpose of financing the Project. DISCUSSION Santa Ana Pacific Associates, L.P., a California Limited Partnership created by Pacific West Communities, Inc. (the “Developer”), has requested that the CMFA adopt a financing plan. The financing plan will provide for the issuance of revenue bonds and refunding bonds in an aggregate principal amount not to exceed $123,000,000 (the “Bonds”). These Bonds may be issued from time to time, in multiple series and used for the Project. In order for all or a portion of the Bonds to qualify as tax-exempt bonds, the City of Santa Ana must conduct a public hearing (the “TEFRA Hearing”) providing members of the community an opportunity to speak in favor of or against the use of tax-exempt bonds by the Developer. Following the close of the TEFRA Hearing, the Mayor or designee will execute the approval of the issuance of the Bonds by the CMFA for the financing of the Project in the form of a Resolution (Exhibit 1). The Bonds to be issued by the CMFA are the sole responsibility of the Developer. The City has no financial or legal liability for the Project or repayment of the Bonds, and the Bonds do not constitute any type of indebtedness for the City. TEFRA Hearing for First Point Apartments I December 20, 2022 Page 2 3 1 3 8 The Board of Directors of the California Foundation for Stronger Communities, a California non-profit public benefit corporation, acts as the Board of Directors for the CMFA. Through its conduit issuance activities, the CMFA shares a portion of the issuance fees it receives with its member communities and donates a portion of these issuance fees to the Foundation for the support of local charities. Project Description First Point Apartments I is a new construction project located in Santa Ana on a 3.98- acre site. The project consists of 343 restricted rental units and 3 unrestricted managers’ units. The project will have 26 one-bedroom units, 160 two-bedroom units, 84 three-bedroom units and 76 four-bedroom units. The building will be a six-story, wood frame structure on top of a parking podium. Common amenities will include community gathering areas, community rooms, a playground, exercise room, computer room and community laundry facilities. Each unit will have a refrigerator, dishwasher, garbage disposal, range with an oven and covered patio or balcony. This development will provide 343 units of affordable housing for a 55 year period. FISCAL IMPACT The City received a payment of $928 to hold a TEFRA Hearing for this project that was deposited into the Miscellaneous Revenue account 01102002-53902 TEFRA Hearing Fee. EXHIBIT(S) 1. TEFRA Resolution Submitted By: Michael L. Garcia, Executive Director of Community Development Approved By: Kristine Ridge, City Manager Resolution 2022-XXX Page 1 of 3 RESOLUTION NO. 2022-XXX A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA ANA APPROVING THE ISSUANCE BY THE CALIFORNIA MUNICIPAL FINANCE AUTHORITY OF EXEMPT FACILITY BONDS FOR A QUALIFIED RESIDENTIAL RENTAL PROJECT FOR FIRST POINT APARTMENTS I WHEREAS, Santa Ana Pacific Associates, a California Limited Partnership (the “Borrower”) or a partnership of which Pacific West Communities, Inc. (the “Developer”) or a related person to the Developer is the general partner, has requested that the California Municipal Finance Authority (the “Authority”) adopt a plan of financing providing for the issuance of exempt facility bonds for a qualified residential rental project pursuant to Section 142(a)(7) of the Internal Revenue Code of 1986 (the “Code”) in one or more series issued from time to time, including bonds issued to refund such exempt facility bonds in one or more series from time to time, and at no time to exceed $123,000,000 in aggregate principal amount (the “Bonds”), to finance or refinance the acquisition, construction, improvement and equipping of a multifamily rental housing project located at 2114 E. 1st Street, Santa Ana, California (the “Project”); and WHEREAS, pursuant to Section 147(f) of the Code, the issuance of the Bonds by the Authority must be approved by the City of Santa Ana (the “City”) because the Project is located within the territorial limits of the City; and WHEREAS, the City Council of the City is the elected legislative body of the City and is one of the “applicable elected representatives” required to approve the issuance of the Bonds under Section 147(f) of the Code; and WHEREAS, the Authority has requested that the City Council approve the issuance of the Bonds by the Authority in order to satisfy the public approval requirement of Section 147(f) of the Code and the requirements of Section 4 of the Joint Exercise of Powers Agreement Relating to the California Municipal Finance Authority, dated as of January 1, 2004 (the “Agreement”), among certain local agencies, including the City; and WHEREAS, pursuant to Section 147(f) of the Code, the City Council has, following notice duly given, held a public hearing regarding the issuance of the Bonds, and now desires to approve the issuance of the Bonds by the Authority. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SANTA ANA AS FOLLOWS: Section 1. The above recitals are true and correct. Section 2. The City Council hereby approves the issuance of the Bonds by the Authority. It is the purpose and intent of the City Council that this Resolution constitute approval of the issuance of the Bonds by the Authority, for the purposes of (a) Section 147(f) of the Code by the applicable elected representative of the governmental unit having EXHIBIT 1 Resolution 2022-XXX Page 2 of 3 jurisdiction over the area in which the Project is located, in accordance with said Section 147(f) and (b) Section 4 of the Agreement. Section 3. The issuance of the Bonds shall be subject to approval of the Authority of all financing documents relating thereto to which the Authority is a party. The City shall have no responsibility or liability whatsoever with respect to repayment or administration of the Bonds. Section 4. The adoption of this Resolution shall not obligate the City or any department thereof to: (i) provide any financing with respect to the Project; (ii) approve any application or request for or take any other action in connection with any planning approval, permit or other action necessary with respect to the Project; (iii) make any contribution or advance any funds whatsoever to the Authority; or (iv) take any further action with respect to the Authority or its membership therein. Section 5. The City Manager and applicable Executive Directors of the City are hereby authorized and directed, jointly and severally, to do any and all things and to execute and deliver any and all documents that they deem necessary or advisable in order to carry out, give effect to and comply with the terms and intent of this Resolution and the financing approved hereby. Section 6. This Resolution shall take effect immediately upon its adoption by the City Council, and the Clerk of the Council shall attest to and certify the vote adopting this Resolution. ADOPTED this ____ day of _______________, 2022. _______________________________ Mayor APPROVED AS TO FORM: Sonia R. Carvalho City Attorney By:__________________________ John M. Funk Chief Assistant City Attorney EXHIBIT 1 Resolution 2022-XXX Page 3 of 3 AYES: Councilmembers NOES: Councilmembers ABSTAIN: Councilmembers NOT PRESENT: Councilmembers CERTIFICATE OF ATTESTATION AND ORIGINALITY I, _________________, Clerk of the Council, do hereby attest to and certify the attached Resolution No. 2022-___ to be the original Resolution adopted by the City Council of the City of Santa Ana on _____________, 2022. Date: ___________________ ____________________________ Clerk of the Council City of Santa Ana EXHIBIT 1