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DATE: |
February 11, 2025 |
09 |
SUBJECT
Title
NOTICED PUBLIC HEARING: ISSUANCE OF EXEMPT FACILITY BONDS BY THE CALIFORNIA MUNICIPAL FINANCE AUTHORITY FOR THE BENEFIT OF ALVARADO CREEK APARTMENTS IN AN AGGREGATE AMOUNT NOT TO EXCEED $100,000,000 (DISTRICT: 2)
Body
OVERVIEW
The County has received a request from the California Municipal Finance Authority (“CMFA” or “Authority”) to conduct a public hearing as required by the Internal Revenue Code and to approve the Authority’s issuance of one or more series of exempt facility bonds in an aggregate principal amount not to exceed $100,000,000 (the “Bonds”), for the benefit of San Diego Pacific Associates (the “Borrower”), a California Limited Partnership. The Borrower has applied for the financial assistance of the Authority to finance or refinance the acquisition, construction and development of a multifamily rental housing project of Alvarado Creek Apartments located at 5901-5913, 5915 & 5927 Mission Gorge Road, San Diego, California (collectively, the “Project”).
The Authority is authorized to assist in financing for nonprofit public benefit organizations or for-profit corporations with a public benefit project wishing to issue revenue bonds, including the Borrower. To initiate such a financing, the Borrower is asking the County of San Diego, a member jurisdiction in which the project resides to: (1) conduct a public hearing to satisfy the public approval requirement of Section 147(f) of the Internal Revenue Code; and (2) approve the Authority’s issuance of the Bonds. Although the Authority will be the issuer of the Bonds for the Borrower, the financing cannot proceed without the approval of an applicable legislative body.
Today’s recommendations will provide the Authority with the required authorization to pursue its determination to issue the Bonds on behalf of the Borrower for the Project.
RECOMMENDATION(S)
CHIEF ADMINISTRATIVE OFFICER
1. Pursuant to Section 147(f) of the Internal Revenue Code, hold a public hearing regarding the financing of the Project.
2. Adopt a Resolution entitled:
RESOLUTION OF THE BOARD OF SUPERVISORS OF THE COUNTY OF SAN DIEGO APPROVING THE ISSUANCE OF CALIFORNIA MUNICIPAL FINANCE AUTHORITY EXEMPT FACILITY BONDS IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $100,000,000 FOR THE PURPOSE OF FINANCING OR REFINANCING THE ACQUISITION, CONSTRUCTION, IMPROVEMENT AND EQUIPPING OF ALVARADO CREEK APARTMENTS
EQUITY IMPACT STATEMENT
The Authority was established to assist in financing of nonprofit public benefit organizations or for-profit corporations with a public benefit project wishing to issue or reissue bonds. The Bonds issued will be used to finance or refinance the acquisition, construction and development of a multifamily rental housing project located at 5901-5913, 5915 & 5927 Mission Gorge Road, San Diego, California. The Project will assist the Borrower with its public benefit mission of helping to develop a multifamily rental housing project in the County of San Diego.
SUSTAINABILITY IMPACT STATEMENT
The proposed action would result in economic, social, health and wellbeing benefits for the community by allowing the Borrower to continue to provide comprehensive and affordable multifamily rental housing to diverse and underserved communities. The proposed action will contribute to County of San Diego Sustainability Goal No. 2 by providing just and equitable access to protect and expand availability of affordable housing by increasing investment in underserved communities of San Diego County.
FISCAL IMPACT
If approved, the proposal will result in approximately $991 of unanticipated revenue to be used to reimburse the County for staff costs associated with this non-County financing. There will be no change in net General Fund cost and no additional staff years.
The Borrower will be responsible for the payment of all present and future costs in connection with the issuance of the financing related to the Project. The County will incur no obligation of indebtedness as a result of today’s actions.
BUSINESS IMPACT STATEMENT
N/A
Details
ADVISORY BOARD STATEMENT
The Debt Advisory Committee, composed of the Chief Financial Officer, Auditor and Controller, and the Treasurer-Tax Collector, concurs with this recommendation.
BACKGROUND
California Municipal Finance Authority (“CMFA” or “Authority”)
The CMFA provides tax-exempt financing for qualified projects located throughout the State of California. The Authority’s mission is to support economic development, job creation, and social programs throughout the State. By assisting nonprofit public benefit organizations and or for-profit corporations with various tax-exempt financing programs, the Authority is able to support programs that improve the health and welfare of California residents. The Authority finances a broad range of facilities including nonprofit projects such as education, health care and cultural facilities, affordable multi-family and senior housing, manufacturing facilities and equipment, solid waste, water, wastewater treatment facilities and infrastructure projects and government sponsored financing.
San Diego Pacific Associates (“Borrower”)
The Borrower is San Diego Pacific Associates, a California Limited Partnership. TPC Holdings IX, LLC, an entity owned and operated by Pacific West Communities, Inc. (“PWC”), is the administrative general partner and Central Valley Coalition for Affordable Housing, a nonprofit organization, will serve as the managing general partner. The Borrower was formed for the sole purpose of the Project.
PWC was formed as a real estate development and financing firm, specializing in the construction and rehabilitation of affordable workforce housing throughout the western United States. With a particular emphasis on the use of the affordable housing tax credits, PWC and its related companies develop multi-family and senior citizen housing in the states of California, Arizona, New Mexico, Utah, Oregon, Montana, Idaho, Nevada, Colorado, Washington, and Wyoming. Currently, PWC owns and operates approximately 110 developments with over 6,000 units of affordable housing.
Project
The Alvarado Creek Apartments is the proposed development of a 227-unit rental new construction project. With a mix of 54 studio units (approximately 419 square feet), 54 one-bedroom units (approximately 544 square feet), 59 two-bedroom units (approximately 716 square feet), and 60 three-bedroom units (approximately 1,010 square feet), Alvarado Creek Apartments will provide affordable housing for families earning up to 70% of the area median income (AMI) for San Diego County, with an average affordability of just under 60% AMI. Alvarado Creek Apartments will consist of one, six-story elevator-serviced residential building with five residential levels of Type III-A units over a one-level podium parking structure (Type IA construction). The structure will be designed and detailed in conformance with all applicable building, life, safety, and fire codes. Alvarado Creek Apartments will provide an enhanced street frontage at a pedestrian scale while maximizing community interaction by creating a 15-foot sidewalk along Mission Gorge Road including landscaping and a pedestrian walkway. As mandated by the community plan, a pedestrian sidewalk is provided along the north frontage alley of the site. It is intended that this will connect to future projects in the area to create a more connected community. Additionally, the project includes the restoration of the portion of Alvarado Creek with a nature trail to the south that runs through the property. There is a publicly accessible pedestrian path along the east side of the project site that leads from the sidewalk to the north to the nature trail to the south. The ground level Mission Gorge Road frontage will have a storefront appearance which will give the project a distinctive commercial look while maximizing light and transparency. The storefront aesthetics cover the parking structure behind. Spaces inside the storefront will include a lobby, mail / parcel room, leasing offices, and bicycle storage. The primary pedestrian entry to the building is highly visible from Mission Gorge Road and highlighted by storefront glass to create a warm and inviting experience. The north frontage will have a series of seating areas with trellises along the new pedestrian sidewalk activating the pedestrian connection to the creek. This financing will create units of affordable multifamily housing for the County of San Diego for the next 55 years.
County Involvement
Section 147(f) of the Internal Revenue Code requires that an applicable elected body, with respect to the Project, hold a public hearing and approve the issuance and delivery of the Bonds. The Board of Supervisors of the County of San Diego, as an applicable elected body, is requested to (1) hold a public hearing at which all those interested in speaking with respect to the financing of the Project can be heard and (2) approve the issuance of the Bonds. The Borrower shall be responsible for the payment of all present and future costs in connection with the issuance of the Bonds in an amount not to exceed $100,000,000.
LINKAGE TO THE COUNTY OF SAN DIEGO STRATEGIC PLAN
Today’s proposed action supports the Equity: Housing Strategic Initiative in the County of San Diego’s 2025-2030 Strategic Plan by supporting and allowing the issuance of revenue bonds by CMFA for San Diego Pacific Associates to finance or refinance the acquisition, construction and development of a multifamily rental housing project of Alvarado Creek Apartments located at 5901-5913, 5915 & 5927 Mission Gorge Road, San Diego, California.
Respectfully submitted,
ebony n. shelton
Chief Administrative Officer
ATTACHMENT(S)
1. RESOLUTION OF THE BOARD OF SUPERVISORS OF THE COUNTY OF SAN DIEGO APPROVING THE ISSUANCE OF CALIFORNIA MUNICIPAL FINANCE AUTHORITY EXEMPT FACILITY BONDS IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $100,000,000 FOR THE PURPOSE OF FINANCING OR REFINANCING THE ACQUISITION, CONSTRUCTION, IMPROVEMENT AND EQUIPPING OF ALVARADO CREEK APARTMENTS
2. NOTICE OF PUBLIC HEARING
3. PROJECT APPLICATION FOR BONDS