Resolution - 9520RESOLUTION NO. 9520
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
WEST COVINA, CALIFORNIA REGARDING ISSUANCE OF
MULTIFAMILY HOUSING REVENUE BONDS
is
WHEREAS, pursuant to the provisions of Chapter 7 of Part 5 of Division 31 of the Health
and Safety Code of the State of California (the "Act") the City of West Covina (the "City") has
determined to engage in a multifamily rental housing bond finance program (the "Program") and the
City and/or the Redevelopment Agency of the City of West Covina (the "Agency" and, together with
the City, the "Issuer") has the authority to finance the acquisition and construction of a 124-unit
multifamily rental housing project known as "Executive Lodge " to be located in the City at 1333 W.
Garvey Avenue, West Covina, California (the 'Project"); and
WHEREAS, the Issuer intends to finance the acquisition and construction of the Project by
Southern California Housing Development Corp., or its assigns (the "Developer") with the proceeds
of the sale of multifamily housing revenue bonds the interest on which is excluded from gross
income for federal income tax purposes (the 'Bonds"); and
WHEREAS, prior to the issuance of the Bonds the City, the Agency or the Developer has
incurred or will incur certain expenditures with respect to the Project from available moneys of the
Developer, which expenditures are desired to be reimbursable by the Issuer from a portion of the
proceeds of the sale of the Bonds;
WHEREAS, Section 146 of the Internal Revenue Code of 1986, as amended (the "Code")
limits the amount of multifamily housing revenue bonds that may be issued in any calendar year by
entities within a state and authorizes the governor or the legislature of a state to provide the method
of allocation within the state; and
WHEREAS, Chapter 11.8 of Division 1 of Title 2 of the Government Code of the State of
California (the "Government Code") governs the allocation of the state ceiling among governmental
units in the State of California having the authority to issue multifamily housing revenue bonds; and
WHEREAS, Section 8869.85 of the Government Code requires a local agency to file an
application with the California Debt Limit Allocation Committee ("CDLAC") prior to the issuance
of multifamily housing revenue bonds; and
WHEREAS, notice of a public hearing regarding the issuance of the Bonds has been duly
' published in accordance with the requirements of Section 147(f) of the Code; and
WHEREAS, the members of this City Council (this "City Council") of the City are the
applicable elected representatives to conduct a public hearing regarding the issuance of the Bonds;
and
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WHEREAS, this City Council has conducted a public hearing regarding the issuance of the
Bonds and has determined the issuance of the Bonds to be in the public interest, the proceeds of
which are to be used to make a mortgage loan, to be evidenced by a mortgage note, to the Developer
to finance the acquisition and construction of the Project, all in furtherance of the purposes of the
Act and the public safety, health and welfare of the citizens of the State of California and the City;
and
NOW, THEREFORE, BE IT RESOLVED that this City Council does hereby FIND,
DETERMINE, RESOLVE AND ORDER as follows:
Section 1. Each of the foregoing recitals is true and correct.
Section 2. The City hereby states its intention and reasonably expects to reimburse
Project costs incurred prior to the issuance of the Bonds with proceeds of the Bonds. The proceeds
of the Bonds are expected to be applied to the acquisition, construction and associated costs related
to the Project.
Section 3. The reasonably expected maximum principal amount of the Bonds for the
Project is $9,500,000.
Section 4. This Resolution is being adopted no later than sixty (60) days after the date
(the "Expenditure Date or Dates") that the Issuer will expend moneys for the portion of Project costs
to be reimbursed from proceeds of the Bonds.
Section 5. The expected date of issue of the Bonds is within eighteen (IS) months of the
later of the Expenditure Date or Dates and the first date the Project is placed in service and, in no
event, later than three years after the Expenditure Date or Dates.
Section 6. Proceeds of the Bonds to be used to reimburse for Project costs are not
expected to be used directly or indirectly to pay debt service with respect to any obligation (other
than to pay current debt service coming due within the next succeeding one year period on any tax-
exempt obligation of the Issuer (other than the Bonds)) or to be held as a reasonably required reserve
or replacement fund with respect to an obligation of the Issuer or any entity related in any manner to
the Issuer, or to reimburse any expenditure that was originally paid with the proceeds of any
obligation, or to replace funds that are or will be used in such manner.
'
Section 7. This Resolution is consistent with the budgetary and financial circumstances
of the Issuer, as of the date hereof. No moneys from sources other than the Bonds are, or are
reasonably expected to be reserved, allocated on a long-term basis, or otherwise set aside by the
Issuer (or any related party) pursuant to its budget or financial policies with respect to Project costs.
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To the best of this City Council's knowledge, the City is not aware of the previous adoption of
official intents by the City that have been made as a matter of course for the purpose of reimbursing
expenditures and for which tax-exempt obligations have not been issued or were not intended to be
so issued at the time of adoption.
Section 8. This Resolution is adopted as official action of the City in order to comply
with Treasury Regulation § 1.150-2 and any other regulations of the Internal Revenue Service
relating to the qualification for reimbursement of City expenditures incurred prior to the date of issue
of the Bonds, is part of the City's official proceedings, and will be available for inspection by the
general public at the main administrative office of the City.
Section 9. The City Manager or the Agency Executive Director is hereby authorized and
directed to apply to CDLAC for a private activity bond allocation for application by the Issuer to the
issuance of the Bonds for the Project in an aggregate amount not to exceed $9,500,000, to collect
from the Developer and hold on deposit, if required pursuant to CDLAC requirements, an amount
equal to one-half of one percent (0.5%) of the requested allocation, and to certify to CDLAC that
such amount has been placed on deposit in an account in a financial institution.
Section 10. In accordance with the procedures set forth in Section 147(f) of the Code, this
City Council hereby approves the issuance by the Issuer of the Bonds in an aggregate principal
amount not to exceed $9,500,000 to provide funds for the Program. It is the purpose and intent of
this City Council that this Resolution constitute approval of the issuance of the Bonds by the
applicable elected representative of the governmental unit having jurisdiction over the area in which
the Program is to be conducted in accordance with Section 147(f) of the Code.
Section 11. The City Manager or his designee is hereby authorized and directed to take
whatever further action relating to the issuance of the Bonds may be deemed reasonable and
desirable, provided that the terms and conditions under which the Bonds are to be issued and sold
must be approved by this City Council in the manner provided by law prior to the sale of the Bonds.
Section 12.
This Resolution shall take effect immediately upon its adoption.
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ADOPTED, SIGNED AND APPROVED this lothday of December , 1997.
SATTEST
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City Clerk
APPROVED
E. Kurt Yeager of l
Stradling Yocca Carlson &
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STATE OF CALIFORNIA
COUNTY OF LOS ANGELES
1 Janet Berry , City Clerk of the City of West Covina, do hereby
certify that the foregoing resolution was duly adopted by the City Council of said City at a regular
meeting held on the 1 th day of December 1997, and that it was so adopted by the
following vote:
AYES: Herfert, Melendez, Touhey, Wong
NOES: Howard
ABSENT: None
ABSTAIN: None
City Clerk of the City of W Covina
STATE OF CALIFORNIA
COUNTY OF LOS ANGELES
I, Janet Berry , City Clerk of the City of West Covina, do hereby
certify that the above and foregoing is a full, true and correct copy of RESOLUTION NO.
q52 of said City Council, and that the same has not been amended or repealed.
DATED: December 11 . 1997
City Clerk of the City of West ovina
535771.1\22740,0039