SR 05:219 - Laserfiche WebLink

As with any project of this type, there is risk associated with borrowing of funds and unfortunately, the bank's interest typically overrides the interest of the owner or lessor. As a result, these projects require a level of confidence in the operator and the owner's ability to effectively manage the project and the marketplace to maintain a positive environment for the provided product. BRIDGE and Eskaton are major companies with excellent reputations who are committed to the project and who will focus on providing quality services. While it is difficult to forecast the market for this type of service, the need for assisted living, especially affordable assisted living, is expected to continue to grow. Ultimately this entire project is a form of "partnership" between all of the major players who benefit if it is successful. As a result, while long-term success is not guaranteed, all parties are and will continue working for that goal. As, indicated, the City's team reviewed these provisions and determined they are drafted in a way that minimizes City exposure. Ree:ulatorv Ae:reement and Declaration of Restrictive Covenants (Ree:ulatorv Ae:reement) The Regulatory Agreement sets forth the major operational provisions of the project including affordability. A summary of the major terms is as follows: . The term is consistent with the Ground Lease (i.e., SS-years) . Occupancy will be limited to individuals 60 years of age and older. (Previous information presented to the Council assumed a minimum age of 62 years. However, 60 years is consistent with State regulations and as a result, it has been incorporated into project documents.) . The unitlbed affordability is consistent with the table listed previously. . Monthly charges for affordable units will be set at 80% of a resident's annual income. As an example the charges for Extremely Low Income would be $967 (2S% of AMI! $14,38S). Charges for Very low Income would be $1,933 (SO% of AMI! $28,770). The Agreement also contains language allowing the City Manager to adjust the level of affordability, consistent with other documents, to address financial issues resulting from these units. As an example, if changes are needed to determine resident income of eligibility, the City Manager may make this adjustment. This flexibility is needed to assure the project is capable of reacting to financial and demand issues without the significant cost of an effort involved with amending the Agreement. . The developer (i.e., BLP) (after the payment of other commitments) will create an affordability reserve funded from available surplus cash for the purpose of increasing project affordability for existing affordable units or increasing the number of affordable units. This reserve may also be used to meet sudden economic emergencies at the discretion and approval of the City. Any money available in the affordable reserve at the end of the lease will be returned to the City. The affordability reserve will be reviewed as SR:05:219 Page 8