CRA - 133RESOLUTION NO. CRA -133
A RESOLUTION OF THE CYPRESS REDEVELOPMENT AGENCY
APPROVING ALOAN AGREEMENT AND AGREEMENT TO ACQUIRE COVENANTS
BY AND AMONG THE AGENCY, AFFORDABLE HOUSING ACCESS, INC, AND
CYPRESS —TV, LLC, FOR THE AGENCY'S ACQUISITION OF
LONG -TERM AFFORDABILITY COVENANTS
WHEREAS, the Cypress Redevelopment Agency "Agency is a public body,
corporate and politic, organized and existing under the California Community
Redevelopment Law (Health Safety Code 33000 et seq.); and
WHEREAS, the Agency and the City Council of the City of Cypress "City" or
"City Council," as appropriate), in accordance with all applicable law, previously adopted
the Redevelopment Plan for the Cypress Merged Redevelopment Project Area
"Merged Project Area and
WHEREAS, one of the Agency's primary purposes is to increase, improve, and
preserve the community's supply of affordable housing; and
WHEREAS, Health and Safety Code Section 33413(b) imposes certain
affordable housing production requirements on the Agency, and subdivision (b)(2)(B) of
that Section allows a redevelopment agency to satisfy up to fifty percent (50 of such
housing production requirements by purchasing or otherwise acquiring or causing by
regulation or agreement the purchase or other acquisition of long -term affordability
covenants on multifamily units that restrict the cost of renting or purchasing those units
that are presently available at affordable housing cost to persons and families of low or
very low income households, but are units that the agency finds, based on substantial
evidence, after a public hearing, cannot reasonably be expected to remain affordable to
this same group of persons or families; and
WHEREAS, Cypress -Tara Village, LP, a California limited partnership
"Developer is the owner of certain real property located in the City of Cypress and
improved with a rental apartment project commonly known as Tara Village, which
contains one hundred twenty -eight (128) two (2) bedroom units and forty -two (42) three
(3) bedroom units, for a total of one hundred seventy (170) units (collectively, the
"Development and
WHEREAS, all of the units in the Development are currently restricted for rental
to and occupancy by low income persons under certain regulatory agreements
previously entered into by the Developer or the Developer's predecessor -in- interest
(collectively, the "Existing Regulatory Agreements and
WHEREAS, the Existing Regulatory Agreements will terminate by 2035, and at
such time, in the absence of the imposition of new covenants, the units will no longer be
restricted for rental to and occupancy by low income tenants; and
WHEREAS, Agency staff has negotiated a Loan Agreement and Agreement to
Acquire Covenants (the "Loan Agreement with Affordable Housing Access, Inc., a
California nonprofit corporation, and Cypress —TV, LLC, a California limited liability
company, the general partners of Developer (collectively, the "General Partners
pursuant to which the Agency would provide to the General Partners a loan in the
amount of Six Million Seven Hundred Eighty -Eight Thousand Nine Hundred Ninety -Six
Dollars ($6,788,996) (the "Agency Loan and, as consideration therefore, the General
Partners would cause the Developer to record, in favor of the Agency, a Regulatory
Agreement for Affordable Housing (the "Regulatory Agreement imposing long -term
affordability covenants on seventy -two (72) of the two- bedroom units and eight (8) of the
three bedroom units (collectively, the "Restricted Units all as more particularly set
forth in the Loan Agreement and Regulatory Agreement; and
WHEREAS, Five Million Seven Hundred Eighty -Eight Thousand Nine Hundred
Ninety -Six Dollars ($5,788,996) of the Agency Loan would be disbursed to the General
Partners on the recordation of the Regulatory Agreement, and the remaining One
Million Dollars ($1,000,000) of the Agency Loan would be loaned by the General
Partners back to the Agency, for a period of one (1) year; and
WHEREAS, commencing on January 1, 2033, and on each subsequent January
1st for a period of thirty (30) years, one thirtieth (1 /30 of the Agency Loan, or Two
Hundred Twenty -Six Thousand Three Hundred Dollars ($226,300), would be forgiven,
provided the General Partners are not in default under the Loan Agreement or the note
evidencing the Agency Loan; and.
WHEREAS, pursuant to Government Code 53510 et seq. and Code of Civil
Procedure 860 et seq., the Agency intends to file an action for a judgment upon the
validity of the Agency's acquisition of long -term affordability covenants as contemplated
under the Loan Agreement, and one of the Agency's conditions to the "closing" of the
transaction is that the Agency has obtained a final judicial resolution (including any
appeals) of the action in favor of the legality of the transaction, and that the limitations
period to notice any appeal of the action shall have expired; and
WHEREAS, the Agency, in compliance with Health and Safety Code Section
33413(b)(2)(B), held a public hearing on the Loan Agreement and the Agency's
acquisition of long -term affordability covenants on the Restricted Units, for purposes of
determining whether in the absence of the Loan Agreement and Regulatory Agreement
the Restricted Units could reasonably be expected to remain affordable to persons and
families of low or very low income; and
WHEREAS, at the November 10, 2008 public hearing, the Agency received and
considered the staff report and such other information, testimony, and evidence as
presented;
WHEREAS, all actions required to be taken by the Agency precedent to the
adoption of this Resolution were duly and regularly taken in accordance with applicable
law;
NOW, THEREFORE, be it resolved by the Cypress Redevelopment Agency as
follows:
herein.
Section 1. The foregoing Recitals are true and correct and incorporated
Section 2. The Agency finds and determines as follows:
A. That the Restricted Units cannot reasonably be expected to remain
affordable to persons and families of low or very low income, as the Existing Regulatory
Agreements will each expire or terminate by 2035.
B. That the Loan Agreement effectuates the purposes of the Cypress
Merged Redevelopment Project by securing Tong -term affordability covenants on the
Restricted Units.
C. That the Agency's approval of the Loan Agreement and acquisition
of long term affordability covenants on the Restricted Units are, in the Agency's
independent judgment, exempt from the California Environmental Quality Act pursuant
to 14 C.C.R. 15326.
Section 3. The Agency hereby approves the Loan Agreement and the
Agency's acquisition of long -term affordability covenants over the Restricted Units.
Section 4. All actions required by applicable law to be taken by the Agency
precedent to the adoption of this Resolution have been taken in accordance with
applicable law.
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Section 5. The Executive Director and authorized designees are hereby
authorized and directed to take such other and further actions, and sign such other and
further documents, as is necessary and proper in order to implement this Resolution on
behalf of the Agency.
PASSED AND ADOPTED by the governing body of the Cypress Redevelopment
Agency, at a regular meeting held on the 10 day of November 2008.
ATTEST:
uoc exc acu'L'l
SECRETARY OF THE CYPRESS
REDEVELOPMENT AGENCY
STATE OF CALIFORNIA
COUNTY OF ORANGE SS
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CHAIRPERSON OF E CYPRESS
REDEVELOPMENT AGENCY
I, DENISE BASHAM, Secretary of the Cypress Redevelopment Agency, DO
HEREBY CERTIFY that the foregoing Resolution was duly adopted at a regular meeting
of the said Agency held on the 10 day of November 2008; by the following roll call
vote:
AYES: 5 AGENCY MEMBERS: Bailey, Luebben, Narain, Mills, and Seymore
NOES: 0 AGENCY MEMBERS: None
ABSENT: 0 AGENCY MEMBERS: None
SECRETARY OF THE CYPRESS
REDEVELOPMENT AGENCY