No impact to the General Fund. At the closing for the Bonds, the County is reimbursed for costs incurred in the issuance process. Annual expenses for monitoring of Regulatory Agreement provisions ensuring units in the Development will be rented to low income households are accommodated in the documents for the Bonds. The Bonds will be solely secured by and payable from revenues (e.g. Development rents, reserves, etc.) pledged under the Bond documents. No County funds are pledged to secure the Bonds.
The recommended action is the adoption of a Resolution by the Board, as the legislative body of the County, authorizing the issuance of Multifamily Housing Revenue Bonds, the proceeds of which will be used to finance the acquisition and rehabilitation of East Bluff Apartments, a 144 unit residential housing development located at 1813 Marlesta Court in Pinole.
The ownership entity for the development will be EB, L.P., a California limited partnership with EB, LLC serving as general partner of the Borrower and Eden Investments, Inc. serving as the member/manager of EBLLC. The ownership entity is an affiliate of Eden Housing, Inc., a local non-profit housing developer that has developed over 6,000 units of housing over the past 45 years. U.S. Bank will be the tax credit investor special limited partner.
On October 6, 2015, the Board of Supervisors adopted Resolution No. 2015/369 expressing the Board's intent to issue multi-family housing revenue bonds for the Development. That Resolution authorized the submittal of an application by the County for tax-exempt private activity bond authority from the California Debt Limit Allocation Committee. Subsequent to the adoption of that Resolution, the County, as required by Section 147(f) of the Internal Revenue Code, held a noticed public hearing to permit interested parties to comment on the proposed financing and the Development. That hearing was held on October 13, 2015 with no comments received from the public. The Board adopted Resolution No. 2015/405 on November 3, 2015 to authorize proceeding with the issuance of the Bonds pursuant to Section 147(f) of the Internal Revenue Code.
On December 16, 2015, the California Debt Limit Allocation Committee awarded the County authority to issue the Bonds in a maximum principal amount of $29,476,000. That authority will be used to issue and sell the Bonds directly to U.S. Bank National Association, with the proceeds of the Bonds to be used to fund a loan by the County to EB, L.P. In addition to the proceeds of the Bonds, the Development will utilize other forms of financing detailed in Attachment A. The transaction is expected to close on or about March 31, 2016.
Negative action would prevent the County from issuing the Multifamily Housing Revenue Bonds in order to provide a loan to EB, L.P. to finance the acquisition and rehabilitation of East Bluff Apartments.
East Bluff Apartments provide 144 units of affordable rental housing appropriate for families. This supports outcome #3: Families are Economically Self Sufficient.