Consent 1.Y.
Regular City Council Meeting
- Meeting Date:
- 03/22/2010
- TITLE
- West Park Village - Termination of Regulatory Agreement
- PRESENTED BY:
- Brent Brooks
- Department:
- Legal
Presentation:
PROBLEM/ISSUE STATEMENT
The City of Billings has been asked to terminate a Regulatory Agreement for the use of proceeds from City-issued Variable Rate Demand Multifamily Housing Revenue Bonds for the West Park Retirement Center project. West Park Village is a senior living rental housing facility located at 2351 Solomon Avenue. The original bonds, issued in 1985, were used to finance the acquisition and construction of this project, and the use of bonds maintained the tax-exempt treatment of the interest in the bonds. This provided 177 rental housing units that were occupied, in part, by persons of low and moderate income. In 1997, the original bonds were refinanced and low income occupancy provisions were carried forth in this subsequent Agreement.
Requirements under the original Regulatory Agreement and subsequent Agreements include stipulations that no less than 20% of the units would be occupied by low and moderate income households. The General Partner of West Park Partnership, JBGWP, LLC, has provided Company Certifications from the origination of the period of occupancy on January 1, 1987 to December 1, 2007, the agreed upon “period of conformity” for the provision of affordable housing. These Certifications establish compliance with the occupancy requirements set forth in the Regulatory Agreement and subsequent Agreements.
The release and termination of the Regulatory Agreements is required for the owner of the project to refinance and redeem existing bonds. The new loan for the facility will be insured by the U.S. Department of Housing and Urban Development under their LEAN program, therefore expediency in resolving this issue is required. A public hearing is not required to release the Regulatory Agreements. The Mutual Termination of Regulatory Agreement is attached which accomplishes the needed documentation to allow the West Park Partnership to proceed forward with its new loan.
Requirements under the original Regulatory Agreement and subsequent Agreements include stipulations that no less than 20% of the units would be occupied by low and moderate income households. The General Partner of West Park Partnership, JBGWP, LLC, has provided Company Certifications from the origination of the period of occupancy on January 1, 1987 to December 1, 2007, the agreed upon “period of conformity” for the provision of affordable housing. These Certifications establish compliance with the occupancy requirements set forth in the Regulatory Agreement and subsequent Agreements.
The release and termination of the Regulatory Agreements is required for the owner of the project to refinance and redeem existing bonds. The new loan for the facility will be insured by the U.S. Department of Housing and Urban Development under their LEAN program, therefore expediency in resolving this issue is required. A public hearing is not required to release the Regulatory Agreements. The Mutual Termination of Regulatory Agreement is attached which accomplishes the needed documentation to allow the West Park Partnership to proceed forward with its new loan.
ALTERNATIVES ANALYZED
There are no alternatives other than to disapprove the attached Mutual Termination Agreement if the terms of the original agreement and amendments had not been met by West Park Partnership; however those terms have been met.
FINANCIAL IMPACT
The City is under no current financial obligation regarding the use or termination of these bond packages, so there is no financial impact for the release of the Regulatory Agreement.
RECOMMENDATION
Staff recommends that the City Council approve the attached Mutual Termination of Regulatory Agreement.