RES-ORA-0448 Affordable Housing Loan Agreement Aproval 108-118 W. Hoover Ave.I
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RESOLUTION NO. ORA-
0448 A RESOLUTION OF THE ORANGE
REDEVELOPMENT AGENCY APPROVING AN AFFORDABLE
HOUSING LOAN AGREEMENT BY AND BETWEEN THE
ORANGE REDEVELOPMENT AGENCY AND HOOVER & WILSON
I,LP REGARDING 108-118 WEST HOOVER
AVENUE AND MAKING
CERTAIN FINDINGS WHEREAS, the Amended and Restated Redevelopment Plan for the Orange
Merged and Amended Redevelopment Project Area (the Merged Redevelopment Project Area)
was duly approved by the Orange City Council on November 13, 2001 by Ordinance No. 2101,
pursuant to the California Community Redevelopment Law (commencing with Section 33000 of
the Health and Safety Code and hereinafter referred to as the
CRL); and WHEREAS, pursuant to Sections 33334.2(a) and 33334.6(c) of the CRL, not
less than 20% of all taxes which are allocated to the Orange Redevelopment Agency (Agency)
from the Merged Redevelopment Project Area are set aside by the Agency in its Low-
and Moderate-Income Housing Fund (Housing Funds) 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 WHEREAS, pursuant to Section 33334.2 of the CRL, the
Agency may use Housing Funds to assist in the provision of housing for very
low- income households; and WHEREAS, 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 WHEREAS, 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 low and moderate
income households, including very low-income 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 proj ects;and WHEREAS, Hoover & Wilson I, LP, a
California limited partnership (Borrower), has entered into an agreement for the acquisition of certain improved
real property located at 108-118 W. Hoover Avenue (the Site), which is located
outside the boundaries of
WHEREAS, the Site is improved with twenty (20) dwelling units, which units Borrower
has inspected and believes to be suitable for the provision and maintenance of affordable housing;
and
WHEREAS, Borrower has proposed to enter into an Affordable Housing Loan Agreement
the "Agreement") with the Agency pursuant to which: the Agency will provide financial assistance
to Borrower in the form of a loan consisting of $3,484,353 in Housing Funds (the "Agency Loan"),
to be used to acquire and rehabilitate the Site and, thereafter, to cause the dwelling units at the Site
to be made available and rented to persons and families of very low income, for sixty-five (
65)years (the "Project"), as more fully set forth in the Agreement;
and WHEREAS, the City Council has found and determined, and the Agency desires to
find and determine, that the use of the Housing Funds outside the boundaries of the
Merged Redevelopment Project Area for the Project in accordance with the terms and provisions of
the Agreement, is for the benefit of the Merged Redevelopment Project Area 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 WHEREAS, the Project consists of the acquisition and rehabilitation of dwelling units of
a previously existing low-rent housing project and is not, therefore, a "low rent
housing project"within the meaning of Article XXXIV of the California Constitution requiring voter approval
at an
election; and WHEREAS, Borrower has executed and submitted to the Agency and the
City Council copies of the Agreement, in a form that is acceptable to
Borrower; and WHEREAS, Borrower intends to finance the Project in part with a loan (the
Senior Loan)made by a bank or other lender, secured by a first trust deed on the Site (the Senior
Lender); and WHEREAS, pursuant to Section 33334.14 of the CRL, the Agency
may subordinate covenants and restrictions imposed by the Agency to a lien of a lender other than the
Agency where the Agency makes a finding that an economically feasible alternative method of financing
the units on substantially comparable terms and conditions, but without subordination, is
not reasonably available, and where the Agency receives written commitInents reasonably designed to
protect the Agency's investInent in the event of
default; and WHEREAS, the Agency Loan will exceed 50 percent of the cost of the
Project; and WHEREAS, Developer has made a good faith attempt but has been unable
to obtain commercial or private financing for the Project (other than the Senior Loan), at the same
level of affordability and
quantity; and Reso.
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WHEREAS, the Agency has duly considered all terms and conditions of the Agreement
and believes that the acquisition and development of the Property pursuant to the Agreement is in
the best interest of the City and the health, safety, morals and welfare of its residents, and in
accord with the public purposes and provisions of applicable State and local law and
requirements, and that such activities promote the affordable housing objectives of the CRL as
well as the Redevelopment Plan for the Merged Redevelopment Project Area;
NOW, THEREFORE, the Orange Redevelopment Agency resolves, finds and determines,
on the basis of the facts set forth in the agenda report presented to it and any testimony received at
the meeting at which this matter was considered, as follows:
Section I. The foregoing recitals are true and correct.
Section 2. The Agency recognizes that it has received and heard all oral and written
objections to the Agreement, and to other matters pertaining to this transaction, and that all such
oral and written objections are hereby overruled.
Section 3. The Agency hereby finds that the provision of affordable housing pursuant to the
Agreement is of benefit to the Merged Redevelopment Project Area.
Section 4. The Agency hereby finds that the Agency's use of Housing Funds in the amount
of $3,484,353.00 for the Project will be of benefit to the Merged Redevelopment Project Area 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.
Section 5. The Agency hereby finds that the Agreement will provide for housing for very
low-income
persons.Section 6. The Agency hereby finds that an economically feasible alternative method
of financing the Project on substantially similar terms but without subordination of the Agency'
s affordable housing covenants is not reasonably available, and authorizes the Executive
Director or designee to subordinate the Agency's affordable housing covenants to the lien of the
Senior Lender, as provided in the
Agreement.Section 7. The Agency hereby finds, based on substantial evidence, that the use
of Housing Funds in the amount of the Agency Loan is necessary for the Project because
the Developer has made a good faith attempt but been unable to obtain commercial or
private financing for the Project (other than the Senior Loan) at the same level of affordability
and
quantity.Reso. No.
Section 8. The Agency approves the Agreement and hereby authorizes and directs the
Chairman or Executive Director of the Agency or their designee to execute the Agreement on
behalf of the Agency in the form presented at the meeting at which this matter was considered,
and to take all steps and sign all documents and instruments to carry out the Agreement on behalf
of the Agency. A copy of the Agreement when executed by all parties shall be placed on file in
the office of the Agency Clerk.
Section 9. The Chairman or Executive Director, or their designee, is hereby authorized,
on behalf of the Agency, to sign all documents necessary and appropriate to carry out and
implement the Agreement and to administer the Agency's obligations, responsibilities and duties
to be performed under the Agreement.
ADOPTED this 13th day of December, 2005.
c,-rftf.
ATTEST:
M;~~~G
I, MARY E. MURPHY, Clerk of the Orange Redevelopment Agency, Orange, California,
do hereby certify that the foregoing Resolution was duly and re~larly adopted by the Orange
Redevelopment Agency at a regular meeting thereof held on the 13t day of December, 2005, by the
following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
DIRECTORS: Smith, Ambriz, Murphy, Cavecche, Dumitru
DIRECTORS: None
DIRECTORS: None
DIRECTORS: None
14 EG.
MaryE.~AgenCY~
Rcso. No. ORA-