HomeMy WebLinkAboutRESO 9042Resolution No. 9042
Resolution of the Council of the City of Palo Alto Committing $2.5
Million In-Lieu Fees from SummerHill Homes to Tree House
Apartments, L.P., for the Development of the 35-Unit Affordable
Housing Tree House Apartments Project at 488 W. Charleston Road
WHEREAS, On March 16,2009, the City Council approved a loan agreement with Tree
House Apartments, L.P. to provide an acquisition loan in the amount of $2,838,577 from the
Residential Housing Fund and Community Development Block Grant (CDBG) funds for the
development of the project; and
WHEREAS, On April 3, 2009, Council approved a Planned Community (PC) zone
application for the development ofthe 35-unit affordable housing project at 488 West Charleston
Road; and
WHEREAS, On December 9,2009, Council approved an amendment to the Agreement
between SummerHill Redwood Gate LLC and the City of Palo Alto allowing the payment of
approximately $4.3 million fees in-lieu of providing seven (7) Below-Market Rate (BMR)
dwelling units; and
WHEREAS, Tree House Apartments, L.P.'s project will provide affordable rental units
to be made available to extremely low income households at or below 35% Area Medina Income
("AMI") and very low income households at or below 50% AMI, with one unrestricted
manager's units; and
WHEREAS, Tree House Apartments, L.P. must have commitments of all local
government funding, including funding from the City of Palo Alto, to have a competitive tax
credit allocation application and such funding commitment can be documented by an approved
resolution; and
WHEREAS, the City has determined that an additional loan amount of $2.5 million for
housing unit construction costs is needed to make the project feasible and that the City funds
shall be provided in the form of a loan with a promissory note at 3% interest deferred for 55
years and secured by a Deed of Trust, and payments will be made from residual receipts over and
above the project's operating expenses and will be divided among other funding agencies based
on the City's proportionate share of its funding to total development costs.; and
WHEREAS, $2.5 million will be available in the Residential Housing In-Lieu Fund from
the payment of in-lieu fees from SummerHill Redwood Gate Project; and
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WHEREAS, the appropriation of funds committed from the Residential Housing In-Lieu
Fund is for one-time cost and no future funding costs are anticipated; and
WHEREAS, the City Council authorization is needed to amend the 2010-11 budget as
hereinafter set forth.
NOW, THEREFORE, the Council of the City of Palo Alto does RESOLVE as follows:
SECTION 1. The sum of $2.5 million is hereby appropriated to non-salary expense in
the Residential Housing In-Lieu Fund to be committed to the Tree House project as a loan for the
affordable housing project. No transfer shall occur except per execution of loan agreements
prepared in a form approved by the City Attorney.
SECTION 2. A note receivable of $2.5 million will be established on behalf of the Tree
House project, upon execution of the aforesaid loan agreements.
INTRODUCED AND PASSED: March 08, 2010
AYES: BURT, ESPINOSA, HOLMAN, KLEIN, PRICE, SCHARFF, SCHMID,
SHEPHERD,YEH
NOES:
ABSENT:
ABSTENTIONS:
APPROVED AS TO FORM: APPROVED:
A#. ' SSlstant lty ttorney
Director of Planning and
Community
tive
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