RES-ORA-0337 Approving Continued Participation in Mortgage Credit Certificate ProgramRESOLUTION NO. ORA-
0337 A RESOLUTION OF THE ORANGE
REDEVELOPMENT AGENCY APPROVING A REHABILITATION
LOAN AGREEMENT BY AND BETWEEN THE CITY
OF ORANGE, THE ORANGE REDEVELOPMENT
AGENCY AND ORANGE HOUSING
DEVELOPMENT CORPORATION REGARDING 1837-1841
EAST ADAMS AVENUE AND MAKING
CERTAIN FINDINGS.NHEREAS, pursuant to Sections 33334.2(a) and 33334.6(c) of
the Community Redevelopment Law (commencing with Section 33000 of the Health and Safety
Code and hereinaf1:er referred to as the "CRL") not less than 20%) of all taxes which are allocated
to the Orange Redevelopment Agency ("Agency") are set aside: by the Agency in its Low-
and Moderate-Income Housing Fund ("Housing Fund") and used by the Agency for the purpose
of increasing,improving and preserving the community's supply of low- and moderate-
income housing available at affordable housing costs to persons and families of low- and
moderate-income, including very low income
persons and families; and NHEREAS, pursuant to Section 33334.2(e) of the CRL, the
Agency may exercise any and all of its powers to carry
out this purpose; and NHEREAS, pursuant to Section 33334.6(a) of the CRL,
the California State Legislature has found and declared that the provision of affordable housing
outside of redevelopment project areas can be of direct benefit to those projects in assisting
the accomplishment
of project objectives; and WHEREAS, pursuant to Section 33334.2(g) of the CRL, the
Agency may use Housing Funds to assist in the provision of housing for very low-,
low- and moderate-mcome households outside the boundaries of its redevelopment project areas upon resolution
of the City Council and the Agency that such use will be of benefit
to the redevelopment projects; and WHEREAS, Orange Housing
Development Corporation, a California nonprofit corporation ("OHDC"), has entered into an agreement for the
acquisition of celiain improved real propeliy located at 1837-1841 East Adams Avenue (the "
Site"), which is located outside the boundaries of the
City's redevelopment project areas; and WHEREAS, the Site is improved with three
dwelling units, which units OHDC has inspected and believes to be suitable for the provision
and maintenance of affordable housing; and WHEREAS, OHDC has requested the assistance of
the Agency to make available to OBDC $48,544 in Housing Funds to be used to rehabilitate the
Site and, thereafter, to cause tbe dwelling units at the Site to be made available and rented to
persons and families of low and moderate income for thirty (30) years (the "Project"), as more
fully set forth in a Rehabilitation Loan Agreement ("Agreement") by and among the City of Orange,
the Agency and OHDC
WHEREAS, the City Council has found and determined, and the Agency desires to find
and determine, that the use of a portion of the funds from the Housing Fund outside the boundaries
of the City's redevelopment project areas for the Pr~ject in accordance with the terms and
provisions of the Agreement, is for the benefit of the City's redevelopment project areas and is in
the vital and best interests of the City of Orange and the health, safety and welfare of its residents,
and in accord with the public purposes and provisions of applicable federal, state and local laws
and requirements. and contemplates the use of varied sources of private financing in connection
with the acquisition of the Site by OHDC; and
WHEREAS, while OHDC has attempted to obtain private financing on favorable terms
which would not require the subordination of long-term affordability covenants, all of
those lenders who have expressed an interest in providing financing for the proposed acquisition
have indicated that they will require that the lien securing repayment of their loan must be superior
to any long-term affordability covenants in favor of the
Agency; and WHEREAS, based upon the foregoing, as well as the past experience of
OHDC in connection with obtaining permanent financing, it is anticipated that it will be necessary
as a condition to obtaining private funding for the acquisition of the Site by OHDC that
the Agency subordinate its affordability
covenants; and WHEREAS, Section 33334.14 of the CRL provides, in part, that
affordability covenants of an Agency may be subordinated "where the agency makes a finding that
an economically feasible alternative method of financing, refinancing, or assisting the units or
parcels on substantially comparable terms and conditions, but without subordination, is
not reasonably available, and where the agency obtains written commitments reasonably designed to
protect the agency's investment in the eventof
default..."; and WHEREAS, based upon material presented to the Agency, there is not
an economically feasible alternative method of financing available on substantially comparable
terms; and WHEREAS, in the event the Agency subordinates its affordability covenants,
the Agency shall have certain rights to notice and cure in the event of default under such loan as to
which the Agency subordinates its affordability
covenants; and WHEREAS, the City Council and the governing board of the Agency
have duly considercd all tem1S and conditions of the Agreement and believes that the activities
described in the Agreement arc in the best interests of the City and health, safety, morals and welfare
of its residents, and in accord with the public purposes and provisions of applicable State and
local Im\requirements, and that such activities promote the affordable housing objectives of the
CRL as well as the R<::development Plans for the Northwest, Southwest and Tustin
Street
Redevelopment Projects;NO\V, THEREFORE, the Orange Redevelopment Agency resolves, on the basis
of the facts set fOt1h in the agenda report presented to it and any testimony received at tfle
meeting
at
2
which thi.s matter was considered, as follows:
Section 1. That the Agency's use of funds from the Housing Fund in the amount of
48,544 for the Project will be of benefit to the City's redevelopment projects.
Section 2. That the provision of affordable housing pursuant to the Agreement is of benefit
to each of the following redevelopment projects and their project areas: the Tustin Street
Redevelopment Project; the Southwest Redevelopment Project; and the Northwest Redevelopment
Proj ect.
Section 3. That an economically feasible alternative method of financing, refinancing, or
assisting the units or parcels on substantially comparable terms and conditions, but without
subordination, is not reasonably available, and the Agency shall obtain written commitments
reasonably designed to protect the Agency's investment in the event of default.
Section 4. That the Agency hereby authorizes and directs the Executive Director to execute
the Agreement on behalf of the Agency and to take all steps and sign all documents and
instruments to carry out the Agreement on behalf of the Agency, and such agreements or other
instruments as may be necessary or convenient to effectuate the subordination of affordability
covenants unless it is hereafter determined by the Executive Director of the Agency that such
subordination is not necessary.
ADOPTED this 9th_ day of _ Decembet~, 1997.
ATTEST:
ORANGE REDEVELOPMENT AGENCY,
a pub~,ody, corporate and politic
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I hereby certify that the foregoing Resolution was duly and regularly adopted by the
Orange Redevelopment Agency at a regular meeting thereof held on the9th day of
December , 1997, by the following vote:
AYES: Murphy,Slater,Coontz,Spurgeon,Alvarez
NOES: None
ABSENT: None
ABSTAIN: None
j
TJR:DG Reso No. ORA 0337
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