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4. Adopt "Kottinger Gardens" as the official name of the proposed new development. 5. Approve the Memorandum of Understanding between the City of Pleasanton, The Housing Authority of the City of Pleasanton and Pleasanton Gardens, Inc. (Attachment 3). 6. Approve the Predevelopment Loan Note for $2.8 million (Attachment 4) and increase the appropriation of Lower Income Housing Funds (271900) from $8 million to $10 million reflecting the City's potential total financial contribution to the development. 7. Authorize the Mayor's execution of a letter to HUD, on behalf of the City Council, expressing support for the disposition and demolition of the existing Kottinger Place development (Attachment 6) FINANCIAL STATEMENT Total cost for developing and construction the new development is estimated at $61.6 million. Funding will come from a number of sources including 9% tax credit equity, a conventional permanent loan, HOME loan and a financial contribution from the City. The City Council previously approved an appropriation of $8 million for the development; however, this amount may increase to $10 million pending the outcome of financing. Also, HUD's decision regarding Kottinger Place disposition could also impact overall contributions. BACKGROUND On November 4, 2003, in response to an interest expressed by a group of residents, the Council authorized staff to begin studying the potential for the replacement, expansion and/or renovation of Kottinger Place, a 50-unit low income HUD Public Housing development owned by the Housing Authority of the City of Pleasanton, and Pleasanton Gardens which is a privately owned 40-unit affordable senior development located at 251 Kottinger Drive. To assist with this project, in February 2004, the Council approved the formation of a ten member Kottinger Place Task Force (Task Force). The Task Force membership was increased to fourteen members in February 2012 and since that time it has been focused on implementing the project goals and concepts included in the Kottinger Place and Pleasanton Gardens Predevelopment Analysis Report adopted by the City Council on October 2012. Councilmember Cook-Kallio is currently the City Council appointed liaison on the Task Force. As currently structured, the development would be constructed on property owned by the City and ground leased to a partnership controlled by MidPen Housing Corporation that would, through its property management group, operate the 185 unit development to provide rent restricted independent living rental housing for very low income seniors 62 years and older. Construction of the development would be phased with a portion of the Kottinger Place site being constructed first followed by the remainder of the Kottinger Place site and the Pleasanton Gardens site once its residents are relocated to the first phase. Page 2 of 9