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01-19-1999 - Public Hearing - Vintage Garden Senior Apartments - Issuance of Multifamily Housing Bonds�'� .- � • City of West Covina Memorandum A AGEl��D TO: City Council and the City Manager ' ITEM NO. A-1 DATE January 19, 1999 FROM: Redevelopment Agency Staff ®PRINTED ON RECYCLED PAPER SUBJECT: PUBLIC HEARING VINTAGE GARDEN SENIOR APARTMENTS - ISSUANCE OF MULTIFAMILY HOUSING BONDS SUMMARY: USA Properties Fund is seeking multi -family bond financing for the construction and financing of Vintage Gardens Senior Apartments to be Located at 1950 Badillo Street. The tax-exempt bonds are to be issued by the Association of Bay Area Governments Finance Authority for Nonprofit Corporations (ABAG Finance Authority) a joint powers authority created by its members to facilitate issuance. of this type. The process to issue the bonds requires a noticed public hearing by the City to find the public necessity and approve the issuance of the bonds. This is known as the Tax Equity and Fiscal Responsibility Act of 1982 (TEFRA) public hearing and is required to be held by the City Council, even if the bonds are not issued by the City. For the bonds to be issued by the ABAG Finance Authority, the City must: 1) join the joint powers authority and 2) approve the joint power's authority to issue the bond, per tax law requirements. BACKGROUND The Vintage Garden Senior Apartments, to be constructed at 1950 Badillo Street (old Sunkist School site),.will be 188 units of affordable, rent restricted active senior apartment homes. USA Properties Fund, a Roseville based developer, is currently in escrow and expects to close by the end of May 1999. USA Properties Fund intends to construct Vintage Garden Senior Apartments using tax-exempt bond financing. The tax-exempt financing requires the developer to restrict not less than 20 percent, of the units for households earning 80 percent or less of the County Median Income adjusted for household size. Vintage Gardens Senior Apartments is expected to have 100 percent of the units (188 units) restricted to households with incomes no more than 60 percent of Los Angeles County Median Income adjusted for household size for a period of not less than 30 years. USA Properties has not requested any City or Redevelopment Agency financial assistance. The ABAG Finance Authority was created in 1990 by its members which are cities and counties throughout California to issue conduit debt on behalf of cities and counties. The joint powers authority has over 30 members comprised of cities, counties and special districts. In 1996, ABAG Finance Authority began issuing multi -family housing bonds on behalf of its members. ABAG Finance Authority often issues debt for an individual developer with projects in multiple jurisdictions. DISCUSSION The ABAG Finance, Authority has applied to the California Debt Limit Advisory Committee on behalf of USA Properties for $10,500,000 in multifamily housing bond allocation to fund the project. Payment of the bond's debt service will be made by the developer from the project's cash flow. Federal tax law requires that the issuer of any tax-exempt, multi -family housing bond to obtain the approval of the legislative body of the jurisdiction where the project is located and hold a public hearing ("TEFRA hearing" = Tax Equity and Fiscal Responsibility Act of 1982) on the matter. The City of West Covina would not have any monetary liability or responsibility for the project. In addition, the City would need to join the ABAG Finance Authority joint • City Council and the City Manager January-l9, 1999 Page 2 powers authority, for which there is no present or future cost. the ABAG Finance Authority is attached (Exhibit A). i The joint powers agreement with The Mayor and the Mayor Pro Tem are appointed as the City's representatives to the governing body of the ABAG Finance Authority for Non-profit Corporations ("Authority") and the City Manager and Assistant City Manager are appointed as alternate representatives. The representatives will represent the City's interests and exercising the authority of the City with respect to the Authority and voting on behalf of the City on all matters delegated to the governing body of -the Authority. CONCLUSION The Vintage Garden project would benefit the. City by adding 188 new senior affordable units (128 one -bedroom and 60 two -bedrooms) to the housing stock with no financial contribution by the City or Redevelopment Agency. This is similar to the action that the City Council has taken for the Brookhollow apartment project that was brought before the City Council on January 20, 1998. Staff supports the request made by USA Properties Fund for the TEFRA hearing and the proposed development of the Vintage Garden Senior Apartment project. RECOMMENDATION It is recommended that the City Council Approve and Adopt the following: RESOLUTION NO. 7r/v 15 -A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF WEST COVINA APPROVING THE ISSUANCE OF MULTIFAMILY HOUSING REVENUE BONDS BY THE ABAG FINANCE AUTHORITY FOR THE NON-PROFIT CORPORATIONS (VINTAGE GARDENS SENIOR APARTMENTS COMMUNITY) RESOLUTION NO. - A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF WEST COVINA AUTHORIZING THE EXECUTION AND DELIVERY OF A JOINT EXERCISE OF POWERS AGREEMENT Respectfully Christopher J. Chu Redevelopment Di Attachments: Exhibit A - Joint Powers Agreement Resolutions HSG5631k.DOC Reviewed By: W. C tI. Ray and M.Fong Senior Project Manager b .4 Exhibit A JOINT POWERS AGREEMENT CREATING THE ABAG FINANCE AUTHORITY FOR NONPROFIT CORPORATIONS Dated as of April 1, 1990 Revised as of September 18, 1990 June 9, 1992 t ,� A j �. JOINT POWERS AGREEMENT • TABLE OF CONTENTS Pacze ARTICLE I CREATION OF THE ABAG FINANCE AUTHORITY FOR NONPROFIT CORPORATIONS .................. ARTICLE II PURPOSES .:................................. ARTICLE III DEFINITIONS ........ ....... ............. ARTICLE -IV PARTIES TO AGREEMENT ..... :............... ARTICLE V TERM OF AGREEMENT ............................ ARTICLE VI. POWERS OF THE AUTHORITY ..................... ARTICLE VII MEMBER ENTITY RESPONSIBILITIES .............. ARTICLE VIII MEMBERSHIP .... ...... ..................... ARTICLE IX BOARD OF DIRECTORS ......\.................. ARTICLE X COMMITTEES ........ ......................... ARTICLE XI BOARD AND COMMITTEE MEETINGS ............... ARTICLE XII OFFICERS AND EMPLOYEES ...................... ARTICLE XIII FISCAL YEAR .......... ,.................... ARTICLE XIV BUDGET ............................ .... .. ARTICLE XV ANNUAL AUDIT AND AUDIT REPORTS ............. ARTICLE XVI ESTABLISHMENT AND ADMINISTRATION OF FUNDS . ARTICLE XVII ADMINISTRATIVE COSTS ....................... ARTICLE XVIII NEW.MEMBERS ............................... ARTICLE XIX WITHDRAWAL ... ............................... ARTICLE XX EXPULSION .................................. ARTICLE XXI TERMINATION AND DISTRIBUTION ................ i, I:\Financial Services\FAN\FANDOCS\Joint Powers Agreement.doc 1 2 2 2 3 3 4 4 5 5 5 6 7 7 7 7 8 8 8 8 9 Page ARTICLE XXII NOTICES ....................................... 9 ARTICLE XXIII PROHIBITION AGAINST ASSIGNMENT ............. 9 ARTICLE XXIV AMENDMENTS ................................. 10 ARTICLE XXV SEVERABILITY..........I...................... 10 ARTICLE XXVI LIABILITY OF AUTHORITY ..................... 10 ARTICLE XXVII AGREEMENT COMPLETE.. .................... 10 ARTICLE XXVIII. GOVERNING LAW .............................. 10 ii \\ABAG\SYS\COMMON\Financial Services\FAN\FANDOCS\Joint Powers Agreement.doc ABAG.FINANCE AUTHORITY FOR NONPROFIT CORPORATIONS JOINT POWERS AGREEMENT This Agreement is made,by and among the public entities listed in Appendix A ("Member Entities"), all of which are public entities organized and operating under the laws of the State of California and each of which is a public agency as defined in California Government Code Section 6500. RECITALS I. Government Code Sections 6500-6515, permitting two or more local public entities by agreement Ito jointly exercise any power common to them, authorizes the Member Entities to enter in this ABAG Finance Authority For Nonprofit Corporations. Joint Powers Agreement ("Agreement").. II. Each Member Entity desires to join together with the other Member Entities for the primary purpose of assisting nonprofit corporations located within the jurisdiction or furthering the public purposes of the Member Entities to.obtain tax --:exempt financing for appropriate projects and purposes. III.- The governing board of each Member Entity has determined that it is in the Member Entity -Is best interest and in the public interest that this Agreement be executed and that it is participating as a member of the public entity created by this Agreement. Now therefore, the Member Entities, by, between and among, themselves, in 'consideration of the mutual benefits, promises and agreements set forth below, hereby -agree as follows: ARTICLE I CREATION OF THE ABAG FINANCE AUTHORITY FOR NONPROFIT CORPORATIONS Pursuant to Chapter 5, Division 7, Title 1 of the Government Code of the State of California (commencing with Section 6500) (as amended from time to time, the "JPA Law"), the Member Entities create a public agency, separate and apart from the Member Entities to be known as the ABAG Finance Authority For Nonprofit Corporations (the "Authority"). Pursuant to Government Code Section 6508.1, the debts, liabilities, and obligations of the Authority shall not constitute debts, liabilities, or obligations of any party to this Agreement. A Member Entity may separately contract for or assume responsibility.for specific debts, liabilities, or obligations of the Authority. The.JPA shall require indemnification on behalf of itself and its members as 1 LZ T determined by its Board of Directors from nonprofit corporations and other entities with which it enters into agreements . For purposes of, and to the extent 'required by, Government Code Section 6509, in exercising its powers the Authority shall be subject to the restrictions upon the manner of exercising the powers of 'the city or county Member Entity specified in the Bylaws, except as otherwise authorized or permitted by the JPA Law. ARTICLE II PURPOSES This Agreement is entered into by Member Entities under the JPA Law in order to assist nonprofit corporations and other entities to obtain, financing for.projects and purposes serving the public interest. -- ARTICLE III DEFINITIONS In this Agreement unless the context otherwise requires: "ABAG" means the Association of Bay Area Governments. "Administrative Cost" means the amount charged to each Member Entity by the Authority for -the Authority's general operating costs and expenses. "Authority" shall mean the ABAG Finance Authority For Nonprofit Corporations. "Board" or "Board of Directors", is the governing body of the Authority constituted as set forth in Article IX of this Agreement: "Bylaws" means the bylaws adopted by the Board of the Authority, as amended from time to time. _ "JPA.Law" shall mean Chapter 5 of Division 7 of Title 1 (commencing with Section 6500) of the California Government Code, as amended from time to time. "Member Entity" includes each public agency (as defined in Section 6500 of the JPA Law) which. is a party to this Agreement. ARTICLE IV PARTIES TO AGREEMENT Each Member Entity certifies that it intends to and does 2 contract with every other Member Entity which is a signatory to this Agreement -and, in addition, with such other Member Entity as may later be added as a Member Entity under ARTICLE XVIII: Each Member Entity also certifies.that the deletion of any Member Entity,from this Agreement does not affect this Agreement nor each Member'Entity's intent to.contract with the Member Entities then remaining. ARTICLE V TERM OF AGREEMENT This Agreement became effective as of April 1, 1990, and continues in full force until terminated in accordance with ARTICLE XXI. ARTICLE VI POWERS OF THE AUTHORITY The Authority through its Board of Directors isauthorized, in its own name, to do all acts necessary to fulfill the purposes of this Agreement referred to in ARTICLE II including, but not limited to, each of the following: A. Make and enter into contracts; B. Incur debts, liabilities and obligations; provided that no debt, liability or obligation of the Authority shall be a debt, liability or obligation of a Member Entity except as separately agreed to by a Member Entity; C. Acquire, hold or sell or otherwise dispose of real and personal property by eminent domain or other appropriate means; D. Receive contributions. and donations of property, funds, services and other forms -.of assistance from any source E. Sue and be sued in its own name; _ F. Employ .agents and employees; G. Acquire, construct, manage and maintain buildings; H. Lease real or personal property as lessee and as lessor; I. Receive, collect, invest and disburse monies; J. Issue revenue bonds or other forms of.indebtedness, as provided by.l.aw; 3 K. Carry out other duties as required to accomplish other responsibilities as set forth in this Agreement; L. Assign, delegate or contract with a Member Entity or third party to perform any of the duties of the Board, including but not limited to, acting as administrator for the Authority; and M. Exercise all other powers necessary and proper to carry out the provisions of this Agreement. These powers shall be exercised in the manner provided by applicable law and as expressly set forth in this Agreement. ARTICLE VII MEMBER ENTITY RESPONSIBILITIES Each Member Entity is, and shall remain throughout the term' of its membership in this. Authority, a member or cooperating member of the Association of Bay Area Governments ("ABAG"), and further has the obligations and responsibilities set forth in this Agreement and the Bylaws. ARTICLE VIII MEMBERSHIP A.. Voting Members._ All public agencies in the State shall be eligible to join the Authority as voting Members subject to. the approval of the Board of Directors. B.. Associate Membership. 1. Those public agencies located outside of the nine (9) San Francisco Bay Area Counties shall be eligible to join the Authority as Associate Members, subject to the approval of the. Board of Directors. _. 2. Associate Members shall be entitled to attend all meetings of the Board of Directors but shall not be entitled to vote or participate in debate. Further, no representative of an Associate Member may become an officer or director of the Authority. 3. Eligible nonprofit corporations located within the jurisdictional limits of an Associate Member shall be entitled to apply. to the Authority for assistance in obtaining tax-exempt financing for their projects and purposes serving the public interest which qualify for financing under the Authority's Financing Guidelines. 4 C. For the purposes of this Agreement, both Voting Members and Associate Members shall be referred to as "Member Entities." ARTICLE IX BOARD OF DIRECTORS There shall be a Board of Directors to govern the affairs of the Authority: The Board shall be comprised of one director and two alternate directors from each Member Entity. Each director has one vote. One alternate director may cast a vote as a member of the Board of Directors only in the absence of the director. Each director shall be an elected official of the Member Entity. Each director shall be designated by the governing board of the respective Member Entity. The alternate directors shall.be appointed by the director. Directors and alternate directors are not entitled to compensation. The Board may authorize reimbursement of expenses incurred by directors or alternate directors. The powers of the Board are each of the powers of the Authority not specifically reserved to the Member Entities by this Agreement. The Member Entities retain the following powers: A. The designation of the Board of Directors as specified in ARTICLE IX; and B. Approval of an amendment to this Agreement as specified in ARTICLE XXIV. COMMITTEES Executive Committee. The Board may create an Executive Committee comprised of members of the Board and delegate one or more of its powers'to the Executive Committee. An appointment to the Executive Committee is as set forth in the Bylaws. Other Committees. The Board may create other committees, as desired, pursuant.to the requirements of the Bylaws. ARTICLE XI BOARD AND COMMITTEE MEETINGS The Board shall hold at least -.one regular meeting each 5 year, at which time the Board shall elect its officers as appropriate to comply with ARTICLE XII.. The Board shall fix the date, hour and place at which each regular meeting is to be held. To the extent practicable, each Board meeting shall be held in Alameda County.- The Chair presides at all meetings. A special meeting may be called upon written request by the Chair or at least one-third of the Member Entities. Each regular, adjourned regular, and special meeting of the Board and of all committees shall be called, noticed, held and conducted in accordance with the Ralph M. Brown Act ('Sections 54950, et sea., of the Government Code) . The Secretary shall keep or have kept minutes of each regular meeting of the Board and each committee. As soon as possible after .each meeting, the Secretary shall have a.copy of - those minutes forwarded to each member of the Board and relevant committee. As soon as practicable after the first meeting of the Board or within such time as fixed or extended by the Board, the Board shall approve Authority Bylaws and administrative policies. and procedures for the transaction of its business to govern the day- to-day operations of the Authority. The adoption of Authority Bylaws and administrative policies and procedures requires a vote of two-thirds (2/3) of all Member Entities. No business may.be transacted by the Board without a quorum of members of the Board.being present except that less than a quorum may adjourn from time to time. A quorum consists of a majority of the members of the Board. ARTICLE XII OFFICERS AND EMPLOYEES The Officers of the -Authority are the Chair, Vice -Chair, President, Chief Financial Officer and Secretary. The officers shall be elected or appointed by the Board at' its first meeting. The term of office for Chair, Vice -Chair and_ Secretary is one year. The President and Financial Officer shall serve as set forth in the Bylaws. The duties of the officers shall be as provided in the Bylaws. The officers shall assume the duties of their offices upon formation of the authority or as appropriate. If either the Chair, Vice -Chair or Secretary ceases to be a member of the Board, the resulting vacancy shall be filled at the next regular meeting of the Board held after the vacancy occurs. Officers are not entitled to compensation. The Board may authorize reimbursement of expenses incurred by officers. 9 I The Board may appoint such:officers and employees and may contract with such persons or firms as it considers necessary to carry out the purposes',of this Agreement. ABAG is hereby designated to act as the administrative agency. The Member Entities acknowledge that this designation may cause,potential conflicts to arise and waive any liability on the part of ABAG except for its fraud, gross negligence or. mismanagement. ABAG may not be.removed as the.administrative agency except by reason of its fraud, gross negligence or mismanagement or by unanimous vote of the Board. ABAG shall be reimbursed by the Authority for services rendered on the Authority's behalf. ARTI CLE.. XI I I- _.._.. FISCAL YEAR The first fiscal year of the Authority is the period fromthedate of this,Agreement through June 30, 1990.' Each subsequent fiscal year of the Authority shall end on June 30. ARTICLE XIV BUDGET The Board shall adopt an annual budget not later than sixty (60) days before the beginning of.each fiscal year. ARTICLE XV ANNUAL AUDITS AND AUDIT REPORTS' .The.Chief Financial Officer shall cause an annual financial audit to be made by an independent certified public accountant with respect to all Authority.receipts, disbursements, other transactions and entries into the books. A report of the financial audit shall be filed as a public record with each Member Entity. The audit=shall be filed no later than required by State law. The Authority shall pay the cost of the financial audit and charge the cost against the Member Entities in the same manner as other administrative costs. ARTICLE XVI ESTABLISHMENT AND ADMINISTRATION OF FUNDS The Authority is responsible for the strict accountability of all funds and reports of all receipts and disbursements. It shall comply with every provision of law relating to the establishment and administration'of funds., particularly Section 6505 of the California Government Code. The funds shall be ',accounted for on a full accrual basis. The Chief Financial Officer shall receive, invest; and disburse funds only in accordance with procedures established by the Board and in conformity with applicable law. The Authority shall require. the Chief Financial Officer.to procure errors and omissions insurance or a fidelity bond.. ARTICLE XVII ADMINISTRATIVE COST The Board may establish the Administrative Costs of the Authority, if any, for each fiscal year and may approve a formula for allocating these Administrative Costs among Member Entities for each fiscal year. The.Board may in its discretion impose fees in connection with financings, which fees will be applied against Administrative Costs of the Member Entities in.the manner the Board shall,determine proper. ARTICLE XVIII NEW MEMBERS A new public entity may be admitted as a Member Entity only upon a two-thirds (2\3) vote of the Board. of Directors. Each applicant for membership shall pay all fees,and expenses set by the Board. ARTICLE XIX WITHDRAWAL Member Entities may withdraw at any time on thirty (30) days written notice subject to the following exceptions.. _ 1) the restrictions of Article XXI;- and 2) a Member Entity may not withdraw prior to the closing of a financing for which it has provided authorization as set forth in the Bylaws. ARTICLE XX EXPULSION Subject to the restrictions of Article XXI, the Authority may expel a.Member Entity from the Authority -by a two-thirds (2/3) 8 Y vote of the Board of Directors for a breach of this Agreement or the Bylaws determined by the Board to be a material breach. The procedure for hearing and notice of expulsion of a Member Entity shall be as provided in',the Bylaws. ARTICLE XXI TERMINATION AND DISTRIBUTION This Agreement shall continue until terminated. However, it cannot be terminated until such time as all principal of and interest on revenue bonds and other evidences of indebtedness issued by the Authority shall have been paid in full. Thereafter, this Agreement may be terminated by the written consent of two- thirds of the Member Entities; provided, however, that this Agreement and the Authority shall continue to exist after termination for the purpose of disposing of all claims, distribution of assets and all other functions necessary to conclude the obligations and affairs of the Authority. After completion of the Authority's purposes, any surplus money on deposit in any fund or account of the Authority shall be returned in proportion to the contributions made as required by Section 6512 of the California Government Code. In the event such surplus is generated from proceeds of any financing for a nonprofit corporation or the -payment to the Authority of amounts due with respect to any obligations of a nonprofit corporation, such surplus shall be distributed as provided in the applicable trust agreement. The Board is vested with all powers of the Authority for the purpose of concluding and dissolving the business affairs of the Authority. Notices sufficient if Authority. ARTICLE 'XXII NOTICES to each Member Entity under this Agreement is mailed to its respective address on file with the ARTICLE XXIII PROHIBITION AGAINST ASSIGNMENT No Member Entity may assign a right, claim, or interest it . may have under this Agreement. No creditor, assignee or third party beneficiary of a Member Entity has a right, claim or,title to any part,. share, interest, fund or.asset of.the Authority. I it ARTICLE XXIV AMENDMENTS This Agreement may be amended by a unanimous vote of the Member Entities of the Authority acting through their governing bodies. A proposed amendment must be submitted to each Member Entity at'least thirty (30) daysin advance of the date when the Member Entity considers it.. An amendment is to be effective immediately unless otherwise designated. Appendix A to the Agreement may be amended to correctly list current Member Entities without separate action by the Member Entities -or the Board. ARTICLE XXV SEVERABILITY If a portion, term, condition or provision of this Agreement is'determined by a court to be illegal or in conflict with a law of the State of California, or is otherwise rendered unenforceable or ineffectual, the validity of the remaining portions, terms, conditions and provisions is not affected. ARTICLE XXVI LIABILITY OF THE AUTHORITY Subject to limitations thereon.contained in any trust agreement or other documents pursuant to which financings of the Authority are implemented; funds of the Authority may be used to defend, indemnify, and hold harmless the Authority, any Member Entity, any member of the Board and any employee or officer of the Authority for their actions taken within the scope.of their duties while acting on behalf of the Authority. ARTICLE XXVII AGREEMENT COMPLETE The foregoing constitutes the full and complete Agreement of the Member Entities. There are no oral understandings or. agreements not set forth in writing herein. ARTICLE XXVIII GOVERNING LAW This Agreement shall be governed by and construed in 10 �t r APPENDIX A MEMBER ENTITIES County of Alameda County of Contra Costa County of Santa Clara County of Marin County of Sonoma City and County of San Francisco City of Novato City of Rohnert Park City of Oxnard City of Lincoln City of Union City City of Sacramento City of Roseville City of Rocklin City of San Mateo City of Petaluma City of San Carlos 13 '.t Accordance with the laws of the State of California i IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year written below. APPROVED AS TO LEGAL FORM By City.Attorney CITY OF WEST COVINA Dated: By i Richard Melendez Mayor ATTEST: By City Clerk Receipt Acknowledged and Designation as Administrative Agency Accepted: Dated: ASSOCIATION OF BAY AREA - GOVERNMENTS -By Eugene Y. Leong Executive Director i i SAN GABRIEL VALLEY TRIBUNE i affiliated with SGV Newspaper Group 1210 N. Azusa Canyon Road West Covina, CA 91790 STATE OF CALIFORNIA County of Los Angeles (Space below for use of County Clerk only) 0 PROOF OF PUBLICATION 42015.5 C.C.P.) I am a citizen of the United States, and a resident of the county aforesaid; I am over the age of eighteen years, and not a party to or interested in the above-entited matter. I am the principal clerk of the printer of SAN GABRIEL VALLEY TRIBUNE, a newspaper of general circulation which has been adjudicated as a newspaper of general circulation by the Superior Court of the County of Los Angeles, State of California, on the date of i September 10, 1957, Case Number 684891. The . notice, of which the annexed is a true printed copy, has been published in each regular and entired; issue of said newspaper and not in any supplement thereof on the following dates, to wit: 1/8/99 I declare under penalty of perjury that the foregoing is true and correct. Executed'at West Covina, LA Co.' California t 8 day of �JANUARY 19! 99 IVY1 signature i RECEIVED JAN 1 1 1999 CITY CLERK'S OF WEOVINA BUILDING & ENGI O NG JAN111999 I Proof of Publication of 3