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PUBLIC HEARING
City of San Bernardino
Request for Council Action
Date: August 6, 2025
To: Honorable Mayor and City Council Members
From: Eric Levitt, City Manager
Gabriel Elliott, Director of Community Development & Housing Department: Community Development & Housing
Subject: Public Hearing on the Issuance of Tax-Exempt Bonds for the Village Green Apartments Project (Ward 3)
Recommendation:
It is recommended that the Mayor and City Council of the City of San Bernardino, California:
1. Conduct a Tax Equity and Fiscal Responsibility Act (TEFRA) Public Hearing in consideration of the issuance of tax-exempt revenue bonds financing by the California Municipal Finance Authority for the benefit of Village Green Preservation LP, to provide financing for the acquisition, rehabilitation, improvements, and equipping of a 184-unit multifamily affordable rental housing project generally known as Village Green; and
2. Adopt Resolution 2025-343 approving the issuance of the Bonds by the California Municipal Finance Authority, a joint exercise of powers authority and public entity of the State of California, in an amount not to exceed $46,000,000, (forty-six million dollars) to finance or refinance the acquisition, rehabilitation, improvement and equipping of Village Green, a multifamily rental housing project located at 2122 West Chestnut Street in the City of San Bernardino, California; and
3. Authorize the City Manager or designee to take any further actions and execute any additional documents necessary to effectuate the Tax-Exempt bond issuance for Village Green.
Executive Summary
Village Green Preservation LP (“Borrower”) has requested the City conduct a public hearing under the Tax and Equity Fiscal Responsibility Act (“TEFRA”) in connection 2 8
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with the proposed issuance of revenue bonds by the California Municipal Finance Authority (the “CMFA”), a joint exercise of powers authority and public entity of the State of California, in an amount not to exceed $46,000,000, [forty-six million dollars] (the “Bonds”), to finance or refinance the acquisition, rehabilitation, for improvement and equipping of Village Green, a 184-unit, affordable multifamily rental housing project located at 2122 West Chestnut Street (the “Project”) in the City of San Bernardino, California (the “City”). The CMFA bonds will be solely the Borrower’s responsibility, with no financial or legal obligation on the City.
Background
Village Green is a 184-unit affordable housing community located at 2122 W Chestnut Street in San Bernardino. The property serves low-income families and is supported by a Housing Assistance Payments (HAP) contract that provides project-based subsidy for 65 residential units.
Village Green was developed in 1969 and rehabilitated in 2000 under the Low-Income Housing Tax Credit (LIHTC) program. At that time, a 30-year use restriction was placed on 100% of the units, restricting them to no more than 60% of the Area Median Income ((AMI). That use agreement will expire in 2029, at which time a majority of the units at Village Green could be subject to loss of affordability. The existing County Bond Regulatory Agreement and HAP contract will remain beyond 2029, but both agreements only cover a minority of units.
The CMFA was created on January 1, 2004, pursuant to a joint exercise of powers agreement to promote economic, cultural, and community development by financing economic growth and charitable activities throughout California. To date, over 350 municipalities have become members of CMFA.
The CMFA was formed to assist local governments, non-profit organizations, and businesses with the issuance of taxable and tax-exempt bonds aimed at improving the standard of living in California. The CMFA’s representatives and Board of Directors have considerable experience in bond financing.
Discussion
Village Green offers 104 two-bedroom and 80 three-bedroom apartment units in thirty- eight (38) garden-style residential buildings. Community amenities include barbeque and picnic areas, a community building, two swimming pools, a leasing office, on-site laundry, a computer learning center, a playground, a dog park, and a sports court. A resident Service Coordinator organizes various programs and events, from after- school programming to holiday parties. The Service Coordinator also assists with securing utility assistance, social security, food stamps, and similar resources. All project units serve low-income families at or below 60% AMI, but effective set-asides are substantially lower due to the HAP subsidy
The proposed 4% LIHTC preservation transaction will extend project affordability and support broad rehabilitation of the property with an anticipated construction budget of 2 8
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approximately $12,000,000 (twelve million dollars). In conjunction with the recapitalization, the HAP contract will be extended for the maximum allowable term of 20 years, which ensures ongoing rental subsidies for eligible tenants and prevents the units from converting to market-rate housing during this period.
In connection with the proposed tax-credit preservation transaction, affordability levels will be deepened to the levels below for a minimum term of 55 years. 30% AMI (Extremely Low Income) 19 units 10% of total
50% AMI (Very Low Income) 18 units 10% of total
60% AMI (Low Income) 145 units 80% of total.
This long-term affordability period is a standard requirement for projects using LIHTC in California. This layered approach ensures deep, durable affordability.
The proposed rehabilitation will modernize aging building systems, expand accessibility, and enhance site functionality and efficiency. The scope of work will address all items identified in the Physical Needs Assessment, with areas of focus including windows, siding, stairways, heating, ventilation, and air conditioning, water heaters, appliances, countertops, cabinets, flooring, bathtubs, bathroom vanities, lighting, cameras/security, life safety, parking lots and walkways, as well as common area amenities.
Construction will be completed on a rolling schedule. No households will be permanently relocated, and the development budget will cover any temporary relocation costs. A dedicated Relocation Coordinator will host resident meetings, meet one-on-one with households to identify unique needs/concerns, issue required notices, coordinate professional movers, and generally serve as a point of contact for all parties.
For the Bonds to qualify as tax-exempt bonds, the City of San Bernardino must conduct a public TEFRA Hearing, providing the community members with an opportunity to speak in favor of or against the use of tax-exempt bonds to finance the Project. Before such a TEFRA Hearing, reasonable notice must be provided to the community members. Following the close of the TEFRA Hearing, an “applicable elected representative” of the governmental unit hosting the Project must approve the issuance of the Bonds for the financing of the Project.
The City’s Housing Division is evaluating the proposed rehabilitation project for potential support through housing grant funds. This evaluation will include an analysis of the project’s eligibility, alignment with the City’s affordable housing goals, and funding availability. Should the project qualify, staff will return to the City Council at a future date to seek formal approval for any proposed allocation of housing grant funds in support of the Village Green Apartments project.
2021-2025 Strategic Targets and Goals
Continuing to provide accessibility to housing will improve the quality of life for low- income residents. The Project aligns with Strategic Target No. 3: Improved Quality of 2 8
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Life.
Fiscal Impact
There is no fiscal impact to the City’s General Fund. The CMFA bonds will be solely the Borrower’s responsibility, with no financial or legal obligation to the City. All financing documents will clearly state that the bonds are not obligations of the City or the State and will be repaid entirely by the Borrower.
Conclusion
It is recommended that the Mayor and City Council of the City of San Bernardino, California:
1. Conduct a Tax Equity and Fiscal Responsibility Act (TEFRA) Public Hearing in consideration of the issuance of tax-exempt revenue bonds financing by the California Municipal Finance Authority for the benefit of Village Green Preservation LP, to provide financing for the acquisition, rehabilitation, improvements, and equipping of a 184-unit multifamily affordable rental housing project generally known as Village Green; and
2. Adopt Resolution 2025-343 approving the issuance of the Bonds by the California Municipal Finance Authority, a joint exercise of powers authority and public entity of the State of California, in an amount not to exceed $46,000,000, (forty-six million dollars) to finance or refinance the acquisition, rehabilitation, improvement and equipping of Village Green, a multifamily rental housing project located at 2122 West Chestnut Street in the City of San Bernardino, California; and
3. Authorize the City Manager or designee to take any further actions and execute any further documents as necessary to effectuate the issuance of the Tax- Exempt bond for Village Green.
Attachments
Attachment 1 Resolution No. 2025-343-Village Green TEFRA Attachment 2 TEFRA Public Notice-Village Green
Ward:
Ward 3
Synopsis of Previous Council Actions:
None.