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HomeMy WebLinkAbout1998-01 CRA R . . . ~ REGULATION R98-01 REGULATION REGARDING LOANS California Health and Safety Code Section 33763.5 WHEREAS, pursuant to the Community Redevelopment Law of the State of California (Health and Safety Code Section 33000 et seq., referred to herein as the "Redevelopment Law"), the Community Redevelopment Agency of the City of Santa Ana ("Agency") has adopted redevelopment plans for the redevelopment projects within the City of Santa Ana; and WHEREAS, pursuant to applicable law, the Agency has the authority to make loans to assist property owners, developers and others to redevelop property, provide affordable housing for low- and moderate-income persons and certain other purposes; and WHEREAS, the Redevelopment Law requires that all loans made by a redevelopment agency shall be made according to a regulation that contains standards, qualifications, and criteria for the making and approval of loans and that such regulation has been adopted by the redevelopment agency at a public meeting. NOW, THEREFORE, the Community Redevelopment Agency of the City of Santa Ana hereby adopts the following Regulation: Any loan to be made or approved by the Agency shall comply with the following Standards, Qualifications, and Criteria: 1. Every loan shall be consistent with and in furtherance of the objectives, goals, policies and programs of the Agency, as set forth in the Redevelopment Law, other applicable federal and state laws and regulations, redevelopment plans, implementation plans, and/or other plans, policies, programs, projects and guidelines approved by the Agency. 2. The Agency shall ensure that any of the sources of funds committed to fund a loan will be available for such purpose as and when required by the terms of the loan agreement or other documentation. 3. The Executive Director of the Agency shall have the authority to make and approve loans for the following purposes: a. Residential acquisition and/or rehabilitation; b. Commercial rehabilitation; c. Increasing, improving, or preserving the community's supply of low- and moderate-income housing available at affordable housing cost to persons and families of low-or moderate-income or very- low-income households; . . . d. Using federal funds for such purposes as may be authorized by the applicable federal program; and e. Other purposes authorized by the Redevelopment Law. 4. The aggregate amount of all such loans shall be determined by the Agency as part of the approved annual budget. Within the maximum aggregate amount, the amount of any individual loan shall be determined on the facts and circumstances of each project, not to exceed the amount necessary to accomplish the purpose of the loan. 5. The Executive Director shall have the authority to make and approve the following loans on behalf of the Agency: a. Loans that are in accordance with a specific program that has been approved by the governing body of the Agency where the program contains specific authority for the Executive Director to make loans up to a given amount in accordance with the terms of the approved program; b. Loans that have been approved by the governing board of the Agency at a public meeting; and c. Other loans as may be authorized by the governing board of the Agency. 6. The terms and conditions of any loan approved by the Agency shall be set forth in such documents as the Executive Director or his/her designee may determine are necessary or appropriate, which may include, without limiting the generality of the foregoing, the following: loan agreements; promissory notes; deeds of trust; regulatory agreements, agreements affecting real property or agreements containing covenants; assignments of rents and leases; assignments of contracts; environmental indemnities; guaranties; UCC-1 financing statements; and/or such other or further documents as the Agency Executive Director may deem necessary or appropriate. All final loan documents shall be signed by the Agency's Executive Director or his/her designee and the person or persons authorized to sign on behalf of the borrower, as applicable. 7. The Agency shall require security, if any, for its' loans as may be appropriate in light of the circumstances of each project, and may subordinate its security interests to the liens of other government agencies or public or private lenders, to the extent required in order to make the project feasible. 8. The Agency shall determine appropriate repayment terms for each loan, based upon an assessment of the ability of the assisted project to generate sufficient cash flow to pay all operating costs and pay to the developer a reasonable return on equity, if applicable, and taking into consideration the costs of development, risks assumed by the borrower, use restrictions imposed by the Agency and any other restrictions on the economic use of property, and such other factors that may affect the economic feasibility of a project. . . . Repayment terms may include interest, at an interest rate from zero percent to the maximum interest rate permitted by law. 9. The Executive Director shall have the discretion to negotiate such additional terms and conditions as may be appropriate, including, but not limited to: (a) amortization of loans; (b) payment out of a share of "residual receipts" and/or net proceeds of sales and refinancings; (c) definitions of necessary terms; (d) conditions that shall trigger acceleration of the loan, including unauthorized transfers; and (e) conditions under which all or a portion of outstanding principal and/or interest shall be paid and forgiven. 10. A loan may be amended in the same manner as provided in this Regulation for its approval. 11. The Executive Director shall be responsible for reporting annually on the status of any loans that are $50,000 or more that are in default or not in compliance with the terms of the loan approved by the Agency. This Regulation is effective upon adoption by the governing body of the Community Redevelopment Agency of the City of Santa Ana at a public meeting after notice as required by law, and may be amended only by action of the Agency at a public meeting after notice has been given as required by law. Adopted this 7th day of December, 1998. ATTEST: ~~~ Cynthia J. Nelson Executive Director ~ Chairman AGENCY MEMBERS Pulido Bist Christy Franklin Lutz Moreno McGuigan ~ ~ Aye ~ ~ -¡;;ye- -¡;;ye- APPROVED AS TO FORM: ðb~ £. ~ vbr Joseph W. Fletcher City Attorney