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PL£ASANTON. CITY COUNCIL AGENDA REPORT 9(b) February 6, 2018 City Manager Housing Division TITLE: CONSIDERATION OF RESOLUTION TO APPROVE FINANCIAL SUPPORT FOR SUNFLOWER HILL BY LOAN OF $2,250,000 FROM THE CITY LOWER INCOME HOUSING FUNDS; GROUND LEASE OF DEDICATED PARCEL OF LAND; ALLOCATION OF UP TO $7,195,844 OF THE CITY'S SHARE OF ALAMEDA COUNTY MEASURE Al HOUSING BOND FUNDS SUMMARY Satellite Affordable Housing Associates (SAHA), in partnership with Sunflower Hill, Inc., has submitted a plan to construct Sunflower Hill, the 31 -unit affordable rental housing development for special needs residents. As SAHA secures the financing for the project, including federal and state Lower Income Housing Tax Credit financing anticipated in February 2018, SAHA seeks to finalize a $2,250,000 Lower Income Housing Fund (LIHF) loan previously envisioned by the Exclusive Negotiating Rights Agreement with Sunflower Hill, as well as the allocation of up to $7,195,844 of the City's "Base City Allocation" from the Alameda County Measure Al Housing Bond (Measure Al funding). RECOMMENDATION It is recommended the City Council adopt a resolution approving: 1. The Disposition, Development and Loan Agreement for $2,250,000, related Promissory Note, Deed of Trust, a Regulatory Agreement, and a Ground Lease (collectively the Loan Documents) and authorize the City Manager to execute each such document substantially in the forms attached to the Resolution, with such modifications as may be approved by the City Manager in consultation with the City Attorney, and other documents needed for the transaction; and 2. The allocation of up to $7,195,844 of the City's share of Alameda County Measure Al Housing Bond funds to provided assistance in financing the construction of Sunflower Hill, an affordable rental housing development for residents with special needs. FINANCIAL STATEMENT A cumulative $2,250,000 loan from the City's Lower Income Housing Fund will be provided to Sunflower Hill Irby LLC, a limited partnership for which SAHA is part of the partnership structure with Sunflower Hill to financially support the construction of the 31 - unit Sunflower Hill development. $1,000,000 of the total $2,250,000 will be a payment from the developer of Irby Ranch market rate project into the City's LIHF. The $2,250,000 is included in the City's FY 2017/18 Capital Improvement Program (CIP).