LQ & RDA & HA/ Finance Agreement 09FINANCING AGREEMENT
This FINANCING AGREEMENT ("Agreement") is entered into as of this
g� day of 0C4bo&Lv , 2009, by and among the CITY OF LA QUINTA, a
California municipal corporation and charter city ("City"), the LA QUINTA
REDEVELOPMENT AGENCY, a public body, corporate and politic ("Agency"), and
the LA QUINTA HOUSING AUTHORITY, a public body, corporate and politic
("Authority"1.
WHEREAS, Agency is a public body, corporate and politic, organized under
the California Community Redevelopment Law (Health & Safety Code § 33000 et
seq.); and
WHEREAS, City is a municipal corporation and a charter city of the State of
California, organized and existing under the Constitution of the State of California;
and
WHEREAS, the City established the Authority in accordance with the
California Housing Authorities Law (Health and Safety Code Section 34200 et seq.)
in order to provide suitable, safe and sanitary housing opportunities for City
residents; and
WHEREAS, the Authority presently has no funds with which to carry out its
purposes; and
WHEREAS, the City and Agency desire to provide financial assistance to the
Authority by making periodic advances of funds in order to finance the operations
of the Authority; and
WHEREAS, it is anticipated that the loan financing set forth herein shall be
repaid by Authority from future revenues generated by the Authority's ownership
and operation of housing projects within the City.
NOW, THEREFORE, the City, Agency, and Authority agree as follows:
1 . Agency/City Financing; Interest; Use of Loan Principal.
The City and/or Agency may, from time to time, advance funds to the
Authority to finance the operations and projects of the Authority. Interest shall
accrue on the outstanding principal advanced at the earning rate of the City's
Investment Pool Funds, and shall be adjusted quarterly. The advanced funds shall
be used only for the purpose of financing the operations and projects of the
Authority and for no other purpose.
2. Repayment.
The total funds advanced by the City and/or the Agency, plus all interest
accrued thereon, shall be repaid by the Authority when funds generated from
Authority operations are available. Authority shall be entitled to repay all or part of
the loan principal at any time with no other charges, fees, or penalties. All
amounts due under this Agreement shall be payable at the offices of the Agency or
City (as applicable).
3. Future Financing of Specific Projects.
Notwithstanding anything to the contrary in this Agreement, the parties may
enter into separate agreements with different terms and conditions to finance
particular projects.
4. Recordkeeping.
The Finance Director/Treasurer of the City shall keep appropriate records and
accounts to document all borrowings herein.
5. Non -Recourse Obligation.
No officer, official, employee, agent, or representatives of Authority shall be
liable for any amounts due hereunder, and no judgment or execution thereon
entered in any action hereon shall be personally enforced against any such officer,
official, employee, agent, or representative.
6. Entire Agreement; Amendments.
This Agreement shall constitute the entire agreement of the parties. This
Agreement may be amended or modified only by an agreement in writing signed by
the parties.
This FINANCING AGREEMENT is executed by the duly authorized
representatives of the City, Agency and Authority as of the date first herein above
written.
IfGTel 0,10va
LA QUINTA REDEVELOPMENT
AGENCY, a public body, corporate and
politic
/b�g�y ? (//'may✓!"l�� �-y�-L
Dated Thomas P. Genovese, Executive Director
ATTEST:
veronica j. wwritecino, —
Agency Sec fary
APPROVED,AS'.TO; FORI1/f:
RUTAN & ,TRUCK€R,—LLP
le� — A=�'— —
Katherine Jen
Agency Counseln
"CITY"
CITY OF LA QUINTA, a California
un cipal corpo,5ati and charter city
Dated Thomas P. Genovese, City Manager
IA09:61 I
Veronica J. f�A�(itecino,
City Clerk //
(signatures continued on next page)
APPROVED AS TO FORM:
RUTAN & TUCKER, LLP
/ P - lam-
M. Katherine Jen
City Attorney
"AUTHORITY"
LA QUINTA HOUSING AUTHORITY,
a public body, corporate and politic
ioA X) g
Dated Thomas P. Genovese, Executive Director
ATTEST:
Veronica J. Mprqdc
Authority Se tart'
APPROVED AS TO FORM:
RUTAN & TUCKER, LLP
M. kathe'rine Jenso
Authority Counsel
a
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y OF TttF
COUNCIL/RDA/HA MEETING DATE: October 6, 2009 AGENDA CATEGORY: {
BUSINESS SESSION: _v
ITEM TITLE: Consideration of an Ordinance creating the
La Quinta Housing Commission, a Resolution Approving a CONSENT CALENDAR:
Financing Agreement Among the City of La Quinta, La STUDY SESSION:
Quinta Redevelopment Agency and the La Quinta
Housing Authority and Authorizing the City Manager to PUBLIC HEARING:
Execute the Same, and a Resolution Agreeing to Provide
Staff Services to the La Quinta Housing Authority
RECOMMENDATION:
Motion to take up Ordinance No. by title and number only and waive further
reading, creating the La Quinta Housing Commission;
Motion to introduce Ordinance No. on first reading;
Adopt a Resolution of the City Council approving a Financing Agreement among the
City of La Quinta, La Quinta Redevelopment Agency, and the La Quinta Housing
Authority and authorizing the City Manager to execute the same;
Adopt a Resolution of the City Council agreeing to provide staff services to the La
Quinta Housing Authority.
FISCAL IMPLICATIONS:
The Housing Authority will own affordable housing developments that are awaiting
final disposition to private or non-profit owners/operators. Staff and management
costs associated with these dwellings will be funded from unit rental income; property
acquisition and rehabilitation costs will be funded by the La Quinta Redevelopment
Agency as part of its requirement to increase and improve housing affordable to very -
low, low- and moderate -income households. The Financing Agreement (Attachment 1)
provides that the City or Agency may advance funds to the Housing Authority for
operations and projects until such time the Housing Authority is generating enough
revenue to repay the City and/or Agency. Interest shall accrue on the outstanding
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revenue to repay the City and/or Agency. Interest shall accrue on the outstanding
principal advanced at the earning rate of the City's Investment Pool Funds, and shall be
adjusted quarterly.
The activities of the Washington Street Apartments, the La Quinta Housing Program
and the foreclosed home program will be transferred from the Redevelopment Agency
Low- and Moderate -Income Funds 245 and 246 to the newly -established Housing
Authority Funds 241 and 242. The Fiscal Year 2009-2010 Low and Moderate
Housing Tax Increment Fund budgets include revenues for the La Quinta Housing
Program in Project Area No. 1 of $225,000 in rental income plus $68,700 in interest
income, and $275,000 in expenditures (Account 245-9001-703.51-40); for the
Washington Street Apartments in Project Area No. 2, budgeted revenues are
$163,300 for rental income plus $502,400 in interest income, and $429,300 in
expenditures (Account 246-9002-703.51-30).
CHARTER CITY IMPLICATIONS:
None.
BACKGROUND AND OVERVIEW:
On September 15, 2009, the City Council adopted Resolution No. 2009-075
establishing the La Quinta Housing Authority (the "Housing Authority") and declaring
that the City Council will serve as the Housing Authority's governing body pursuant to
the Housing Authorities Law (California Health and Safety Code Section 34200 et
seq.). This staff report addresses all of the actions that the City, Redevelopment
Agency, and Housing Authority must take to implement the Housing Authority. There
are separate action items on today's Redevelopment Agency and Housing Authority
agendas.
Creation of Housing Commission
In order to operate the Housing Authority with this structure, the City Council must
create an independent housing commission that will review and make
recommendations on all matters to come before the Housing Authority except
emergency matters and matters the Housing Commission itself elects not to consider.
Two of the members of the Housing Commission must be tenants of Housing
Authority housing projects, and one such tenant member must be over 62 years of
age. The requirements for the tenant commissioners are not effective until such time
as the Housing Authority has housing projects with tenants.
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The City Attorney, in consultation with City staff, has prepared an Ordinance for
consideration by the City Council that establishes the La Quinta Housing Commission
(the "Housing Commission"), and sets forth the number of members, member
qualifications, method of appointment, term and other pertinent information.
Approval of Financing Agreement and Agreement to Provide Staff Services
Because the Housing Authority has no funds or staff at this time, City and
Redevelopment Agency staff and the City Attorney have prepared a Financing
Agreement (Attachment 1) that would enable the Housing Authority to borrow funds
from the City and/or Redevelopment Agency and to repay such funds once the
Housing Authority has housing projects that generate revenue. The City
Attorney/Agency Counsel, in consultation with City and Agency staff, has prepared a
resolution for consideration by the City Council approving the Financing Agreement.
Similar Resolutions have been prepared for consideration by the Redevelopment
Agency and the Housing Authority.
Staff, serving the City Council and the La Quinta Redevelopment Agency, shall serve
as staff for the Housing Authority. The City Attorney shall act as chief legal officer of
the Authority. The City Attorney/Agency Counsel, in consultation with City and
Agency staff, has prepared a Resolution for consideration by the City Council agreeing
to provide staff services to the Housing Authority. A similar Resolution is attached to
the report for the Redevelopment Agency.
Approval of Bylaws and Rules of Procedure
Pursuant to the Housing Authorities Law, the Housing Authority can adopt by-laws and
regulations to carry into effect the powers and purposes of the Housing Authority.
Attached to the report for the Housing Authority is a Resolution of the Housing
Authority adopting Bylaws and Rules of Procedure.
Respective Roles of the City, Redevelopment Agency, and Housing Authority
The Redevelopment Agency will continue to take the lead role in acquisition, design,
construction, funding and negotiating affordable housing agreements. The Housing
Authority will be a focused entity that may: lease or rent dwellings or accommodations
in a housing project and establish and revise the rents or charges for them; own or
hold real or personal property; and lease, acquire by gift, grant, bequest, device, or
otherwise, any real or personal property or any interest in property. A housing
authority may acquire by eminent domain any real property which it deems necessary
for its purposes.
Pursuant to the Housing Authorities Law, at the first Housing Authority meeting, the
Mayor will select the initial Housing Authority Chairperson from the Housing Authority
members, and the Housing Authority members will select the first Vice —Chairperson
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from its members. In the following calendar year, the Housing Authority Board shall
annually, at its first meeting held after December 30`h, or as soon thereafter as
possible, vote to elect one of its members as Chairperson and one to serve as Vice -
Chairperson. The Mayor shall specifically be excluded from being eligible to serve as
Chairperson of the Housing Authority. The Housing Authority will have a separate
agenda and minutes with meetings held at the time designated in La Quinta City
Council Resolution No. 2006-102, as it currently exists or as it is amended in the
future, similar to the structure of the Finance Authority.
The Housing Authority may investigate living and housing conditions so as to improve
such conditions, determine where there is a shortage of decent, safe, and sanitary
accommodations for persons of low income, and "engage in research, studies, and
experimentation on the subject of housing."
The Housing Authority shall adopt and announce regulations for a plan and selection of
applicants to assure equal opportunity and nondiscrimination on the grounds of race,
color, or national origin. Leases and lists of rosters of the Housing Authority shall be
confidential and shall not be given to inspection by the public, but can be supplied to
the respective governing body on request.
The Housing Authority shall be audited at least once a year by a certified public
accountant or a public accountant. The audits, a final balance sheet and operations
statement for the year for all Authority funds will be filed for record purposes with the
City Clerk and the Department of Housing and Community Development.
FINDINGS AND ALTERNATIVES:
The alternatives available to the City Council include:
1. Motion to take up Ordinance No. by title and number only and waive
further reading, creating the La Quinta Housing Commission;
Motion to introduce Ordinance No. on first reading;
Adopt a Resolution of the City Council approving a Financing Agreement among
the City of La Quinta, La Quinta Redevelopment Agency, and the La Quinta
Housing Authority and authorizing the City Manager to execute the same;
Adopt a Resolution of the City Council agreeing to provide staff services to the
La Quinta Housing Authority; or
2. Do not adopt an Ordinance of the City Council creating the La Quinta Housing
Commission; or
3. Provide staff with alternative direction.
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Respectfully submitted,
Douglas R. ans
Assistant City Manager — Development Services
Approved for submission by:
Thomas P. Genovese, City Manager
Attachment: 1 . Financing Agreement
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