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<br />6c <br />Approval of documents related to the operations and financina of the Assisted living <br />Facilitv beina developed bv Bridae Housina Corporation. (SR 05:219) <br />Steven Bocian, Assistant City Manager, presented the staff report. <br />Mayor Hosterman recognized and applauded the work of staff and the Assisted Living <br />Subcommittee. <br />Mr. Brozosky asked staff to provide an explanation as to how the Certificates of <br />Participation affect the City's debt ratio and liability. <br />Mr. Bocian said the Certificates of Participation do not affect the debt ratio of the City <br />and is independent of that. The Certificates of Participation are similar to bonds and individuals <br />share in the overall proceeds from a project. He reminded Council that the City issued tax- <br />exempt housing bonds in the past for a number of projects and Certificates of Participation <br />(COP's) for a number of City facilities. An assisted living project does not qualify for housing <br />bonds so the City had to do something unique and utilized Certificates of Participation. <br />Mr. Brozosky noted that the staff report mentioned transportation services would be <br />provided by the Center. He asked if transportation would be provided directly by the Center? <br />Mr. Bocian recalled that the Center would be directly providing transportation services. <br />Mr. Brozosky asked how the affordability reserve would be regulated. <br />Mr. Bocian said the regulation of the affordability reserve is built into the regulatory <br />agreement itself and can be used for three areas. The third area requires the City and the <br />owner to meet to discuss how to use the reserve. He noted that the City reviews the annual <br />operating budget, certified financial audits and monthly reports, and staff anticipates a <br />cooperative effort in working with the Owner and the Operator of the project to review the <br />budget to ensure that funds are being expended appropriately. The focus on this project is not <br />the reserve. The focus for this project is to assure the City has a financially feasible and sound <br />project. Staff anticipates that if there are decisions that need to be made, staff will lean towards <br />assuring that the City is providing quality services and a financially strong project. The <br />affordability reserves are primarily to be utilized if there are excess funds remaining. Staff <br />believed that as a result of the City's significant involvement in the project, the funds should <br />remain with the project; 80 percent of the affordability reserves stay with the project and 20 <br />percent goes to BRIDGE as an incentive for operating the project. <br />Mr. Brozosky pointed out that the staff report indicated that it is not guaranteed that the <br />interest on the City loan of $2,490,000 will be repaid or delayed. He asked staff if the City <br />realizes this as a loan or a gift. <br />Mr. Bocian said it is a loan. <br />Mr. Brozosky asked how many other similar facilities are heavily subsidized. <br />Mr. Bocian said this project is unique. He noted that there is one development in Union <br />City that has a moderate level of affordability. <br />Pleasanton City Council 9 08/16/05 <br />Minutes <br />