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RESOLUTION NO. __________
A RESOLUTION OF THE COUNCIL OF THE CITY OF
BURBANK APPROVING AN AMENDED AND RESTATED
MASTER LOAN AGREEMENT (PHASE I ) AND RELATED
AGREEMENTS AMONG THE CITY OF BURBANK, THE
HOUSING AUTHORITY OF THE CITY OF BURBANK, AND
THE BURBANK HOUSING CORPORATION AND
DETERMINING THE PROJECT TO BE EXEMPT UNDER
THE CALIFORNIA ENVIRONMENTAL QUALITY ACT
(CEQA)
THE COUNCIL OF THE CITY OF BURBANK FINDS:
A. In 1997, the former Redevelopment Agency of the City of Burbank established a non- profit corporation , the Burbank Housing Corporation, (“BHC”), to improve and preserve the existing housing inventory in the City of Burbank that is affordable to low - and moderate-income persons and to provide community assistance and property management services at affordable housing projects within the City of Burbank.
B. The City of Burbank receives funds from the HOME Investment Partnership Act of the United States, 42 USC Sec. 12701 et seq (“HOME Funds” and “City Loan”), for the purpose of the production and operation of housing to low income families.
C. Pursuant to Section 33334.2 of the California Health and Safety Code Section 33000 et seq. (the “Community Redevelopment Law”) ,the Redevelopment Agency of the City of Burbank (“Agency”) was required to expend a certain percentage of property taxes to inc rease, improve and preserve the City of Burbank’s supply of low - and moderate-income housing available at an affordable housing cost. Pursuant thereto, the Agency established a Low and Moderate Income Housing Fund (the “Housing Fund” and “Authority Loan”).
D. Effective February 1, 2012, redevelopment agencies were dissolved in the State of California; the law authorized local housing authorities to accept the former redevelopment agencies assets and housing functions previously performed by redevelopment agenci es. On January 31, 2012, the Housing Authority of the City of Burbank (“Authority”) accepted the Redevelopment Agency housing duties and assets, including the Housing Fund.
E. BHC, the City, and Authority (and former Agency) have worked together to provide and preserve over 326 units at 26 different project sites for low -to-moderate income tenants/owners, funded by City HOME Funds and Authority Housing Fund as a loan.
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F. In 2006, eleven income restricted properties were funded in part by City and the former Agency with each property having a separate loan agreement. On March 21, 2006, a consolidated loan agreement was approved which introduced cross - collateralization and cross-default as additional security for the former Agency and City and eliminated any private funds.
G. Now, with twenty five properties in the portfolio subject to the consolidated loan agreement, (the 26th property is not part of the consolidated loan agreement) , BHC, Authority and City desire to modify the terms of the loan agreement by entering into an Amended and Restated Master Loan Agreement ( Phase 1 ) (“Agreement”) to 1) make forgivable each portion of the City Loan as of the initial term of the original note evidencing that portion of the City Loan as set forth in more detail on Schedule 1 to the City Amended and Restated Promissory Note with certain exceptions; 2) make the annual Authority Loan payment forgivable after the completion of each year of the affordability covenant commencing January 1, 2025 with certain exceptions; 3) to define “affordability covenant period” to be 55 years and three months commencing January1, 2025 and ending April 1, 2080 (“Affordability Period”); 4) eliminate the concept of “residual receipts payments” which had resulted in loan payments only when certain conditions existed; 5) eliminate interest on Authority Loan, including existing outstanding and new interest payments for Authority Loan, to make consistent with City Loan; 6) continue the requirement that two BHC board of director members be comprised of individuals appointed by the City/Authority; and 7) continue certain limitations that currently and must always exist in BHC’s Articles of Incorporation and By-laws to restrict any business and mission of BHC to the geographic area of the City of Burbank; this restriction includes but is not limited to use of any City/Authority funds only for projects located in the City of Burbank (which precludes investing in any non-City of Burbank projects).
H. Modifications to other related agreements are necessary to amend and restate this Agreement, and a form of each is attached as exhibits to the Agreement:
Amended and Restated City Promissory Note; Amended and Restated Authority Promissory Notes; Amended and Restated Deed of Trust; Amended Regulatory Agreements; Ground lease modifications for 427 and 313 West Valencia and 1729-1735 Elliot Dr., 1801-1818 Grismer; (“Exhibits” or Related Agreements”).
I. The City has duly considered all terms and conditions of the proposed Agreement and believes that the Amended and Restated Loan Agreement together with its Exhibits or Related Agreements is in the best interests of the City and the health, safety, and welfare of its residents, and in accord with the public purposes and provisions of applicable state and local laws and requirements.
J. The loan modification is not a project subject to the Environmental Quality Act (CEQA) under state guidelines Section 150602, in that the refinancing will not result in a direct or reasonably foreseeable indirect physical change in the environment, and i s further independently exempt under State Guidelines Section 15061 (b)(3) in that it can be seen with certainty there is no possibility the loan modification will have a significant effect on the environment.
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THE COUNCIL OF THE CITY OF BURBANK RESOLVES:
1. The Amended and Restated Master Loan Agreement (Phase 1) and its Exhibits/Related Agreements, in the form attached to the Staff Report dated January 14, 2025, are approved.
2. The City Manager or their designee is authorized to execute the Agreement, and to execute the Exhibits as standalone independent Related Agreements, on behalf of the City, and shall record, as applicable, the Amended and Restated Deed of Trust and the Regulatory Agreement Amendments. The City Manager or their designee is authorized to implement the Agreements and take all further actions and execute all documents necessary or appropriate to carry out the intent of the Agreement. The City Attorney retains the authority to make minor modifications as long as the financial terms remain unaffected.
3. The Agreement shall be retained by the City Clerk as a permanent file.
PASSED AND ADOPTED this ____ day of January, 2025
__________________________
Nikki Perez
Mayor
Approved as to Form
Attest: Office of the City Attorney
___________________________ By: _______________________ Kimberley Clark, City Clerk Joseph H. McDougall City Attorney
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STATE OF CALIFORNIA )
COUNTY OF LOS ANGELES ) ss.
CITY OF BURBANK )
I, Kimberley Clark, City Clerk of the Council of the City of Burbank, do hereby certify that the foregoing Resolution was duly and regularly passed and adopted by the Council of the City of Burbank at its regular meeting held on this ___ day of January, 2025, by the following vote:
AYES:
NOES:
ABSENT:
____________________________
Kimberley Clark, City Clerk