Community Development Agency
www.santa-ana.gov/cd
Item # 29
City of Santa Ana
20 Civic Center Plaza, Santa Ana, CA 92701
Staff Report
September 15, 2026
TOPIC: Tax Equity Fiscal Responsibility Act Hearing for 1200 Main Apartments
AGENDA TITLE
Public Hearing - Tax Equity Fiscal Responsibility Act Hearing for 1200 Main Apartments Legal Notice published in the OC Reporter on August 28, 2026.
RECOMMENDED ACTION
1. Conduct a Tax Equity and Financial Responsibility Act Hearing in consideration of the issuance of tax-exempt bond financing by the California Municipal Finance Authority on behalf of 1200 Main GP, LLC (the “Borrower”), for the benefit of 1200 Main Apartments to finance or refinance the acquisition, construction, improvement, and equipping of a multifamily rental housing project located at 1200 North Main Street, Santa Ana, California (the “Project”).
2. Adopt a resolution approving the issuance of revenue bonds by the California Municipal Finance Authority in an amount not to exceed $50,000,000 to finance or refinance the acquisition, construction, improvement, and equipping of a multifamily rental housing project located at 1200 North Main Street, Santa Ana, California.
RESOLUTION NO. 2026-XXX entitled A RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF SANTA ANA APPROVING THE ISSUANCE BY THE
CALIFORNIA MUNICIPAL FINANCE AUTHORITY OF EXEMPT FACILITY BONDS FOR 1200 MAIN APARTMENTS
GOVERNMENT CODE §84308 APPLIES: Yes
DISCUSSION
1200 Main GP, LLC (Main GP) has requested that the City of Santa Ana conduct a Tax Equity and Fiscal Responsibility Act (TEFRA) hearing and provide the required local governmental approval. This approval enables Main GP to qualify for tax-exempt bonding financing issued by the California Municipal Finance Authority (CMFA) for the “1200 Main” apartments located at 1200 North Main Street. The purpose of the hearing is to provide the public an opportunity to comment on the project’s proposed tax-exempt bond financing and is required by federal tax law. As the host jurisdiction, the City Council is only being asked to hold the hearing and approve the proposed bond
Tax Equity Fiscal Responsibility Act Hearing for 1200 Main Apartments September 15, 2026
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issuance by CMFA for federal tax purposes. This action does not obligate City funding or grant any land-use entitlements. CMFA will issue the bonds, and the borrower, Main GP, will be solely responsible for repayment. The City serves exclusively as the local approving body of the transaction for federal tax purposes and has received a $1,101 fee to conduct the TEFRA hearing.
The 1200 Main affordable housing project located at 1200 North Main Street was awarded an allocation of federal low-income housing tax credits and tax-exempt bond financing through the California Debt Limit Allocation Committee (“CDLAC”) on May 12, 2026. According to the CDLAC’s Project Staff Report (Exhibit 1), the project consists of the adaptive reuse of an existing nine-story building into 190 residential units, including 188 affordable rental units and two (2) manager’s units. The project proposes a mix of studio, one-bedroom, and two-bedroom units affordable to households earning between 30% and 70% of Area Median Income (“AMI”).
The State awarded the project approximately $2.87 million in annual federal tax credits and approximately $18.2 million in tax-exempt bond authority. With this award, Arden Residential / Kingdom Development (the “developer”) will be able to generate approximately $24.9 million in tax credit equity to finance this project together with a senior loan.
The City of Santa Ana and the Housing Authority did not provide any financial assistance, subsidies, technical assistance, local financing commitment, or any other form of financial or administrative support in connection with this tax credit application or award process. The developer pursued and secured these State financing resources independently of the City. Staff learned about this affordable housing project after the tax credits were awarded by the State. For additional information, staff has prepared a high-level one-page project summary outlining the project, affordability mix, financing structure, and anticipated construction timeline (Exhibit 2). For the purposes of receiving and using their low-income housing tax credits, the developer is now requesting a TEFRA Hearing.
Project Description
The project, 1200 Main, located at 1200 North Main Street in Santa Ana on a 1.6-acre site, is the adaptive reuse of 190 units of housing, consisting of 188 restricted rental units and two (2) unrestricted manager's units. The project has 16 studio units, 168 one- bedroom units, and six (6) two-bedroom units, serving tenants with rents affordable to households earning between 30% - 70% of area median income (AMI). The project will be developed by 1200 Main GP, LLC (Arden Residential / Kingdom Development).
Tax Equity Fiscal Responsibility Act (TEFRA)
1200 Main GP, LLC (the “Borrower”) has requested that the CMFA participate in the issuance of one or more series of tax-exempt revenue bonds, pursuant to a single plan of financing, in a maximum aggregate principal amount of $50,000,000 (the “Bonds”).
These funds are intended to finance or refinance the acquisition, construction, improvement, and equipping of a multifamily rental housing project located at 1200 Tax Equity Fiscal Responsibility Act Hearing for 1200 Main Apartments September 15, 2026
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North Main Street, Santa Ana, California.
However, for any portion of the Bonds to qualify as tax-exempt, the City of Santa Ana must conduct a public hearing (the “TEFRA Hearing”), allowing community members the opportunity to voice their opinions regarding the use of tax-exempt bonds for the Project's financing. After the TEFRA Hearing concludes, an “applicable elected representative” of the governmental unit hosting the Project, in this case, the City, must provide approval for the CMFA to issue the Bonds for the Project's financing (Exhibit 3). Pursuant to Section 147(f) of the Code, the issuance of the Bonds by the Authority must be approved by the City of Santa Ana because the Project is located within the territorial limits of the City.
The bonds to be issued by the CMFA are the sole responsibility of the borrower. The City bears no financial or legal liability for the project or bond repayment and incurs no indebtedness. The adoption of the Resolution shall not obligate the City or any department thereof to: (i) provide any financing with respect to the Project; (ii) approve any application or request for or take any other action in connection with any planning approval, permit, or other action necessary with respect to the Project; (iii) make any contribution or advance any funds whatsoever to the Authority; or (iv) take any further action with respect to the CMFA or its membership therein.
The Board of Directors of the California Foundation for Stronger Communities, a California non-profit public benefit corporation (the “Foundation”), serves as the Board of Directors for the CMFA. Through its conduit issuance activities, the CMFA shares a portion of its issuance fees with its member communities and allocates a portion of these fees to the Foundation to support local charities.
FISCAL IMPACT
Funds in the amount of $1,101 were deposited into the General Fund revenue account for the Miscellaneous Service Charge account (no. 01102002-53902).
EXHIBIT(S)
1. CDLAC Project Staff Report
2. Project Summary
3. TEFRA Resolution
4. Proof of Publication
Submitted By: Sylvia Vazquez, Deputy City Manager/Acting Executive Director of Community Development Agency
Approved By: Alvaro Nuñez, City Manager