Comprehensive Annual Financial Report - City of Santa Monica

CITY OF SANTA MONICA, CALIFORNIA
Notes to Basic Financial Statements, Continued
For the fiscal year ended June 30, 2008
General Fund
a. On April 12, 1990, the City loaned $500,000 from the General Fund, interest free, to American
Youth Hostel, Inc. to assist in financing construction of a 200-bed international youth hostel facility.
The thirteenth of seventeen installment loan payments was received in 2008; the remaining principal
balance at June 30, 2008 is $160,000.
b. A promissory note in the amount of $290,000, interest free, has been executed with Mountain View
Mobile Inn Residents Association for pre-development loan funds to assist in the acquisition and
subsequent conversion of the mobile home park located at 1930 Stewart Street to tenant ownership.
As of June 30, 2008, $124,977 had been disbursed to the borrower.
c. A promissory note in the amount of $1,331,252 was executed with Step Up on Second, L.P., a
California limited partnership, for the construction of a thirty-six bed permanent housing project for
mentally disabled low-income persons. The project is located at 1328 Second Street in Santa
Monica. The original promissory note dated September 16, 1993 was amended, superseded and
replaced in full by a promissory note dated September 9, 1996, the unpaid balance is due not later
than September 16, 2043, and may be extended for a period of up to 25 years. Interest has been
forgiven and the principal balance as of June 30, 2008 is $1,331,252.
d. On April 12, 2006, the City made a housing loan to P. Lamont Ewell, City Manager, in the amount
of $1,300,000 for the purchase of a home within the City limits. The loan is secured by a deed of
trust and has a term of 30 years with an interest rate of 4.7%, subject to annual adjustments as set
forth in the note, not to exceed 4.855%. The outstanding principal, together with any outstanding
interest, is due and payable in full on or before the 30-year anniversary date of the loan. Monthly
interest payments are due on the first calendar day of each month. The City Manager must repay
any outstanding balance of the loan within two years of ending employment with the City. As of
June 30, 2008, the total outstanding balance of the loan was $1,300,000.
Special Revenue Source Special Revenue Fund
e. A revised promissory note in the amount of $6,774,763 was executed with Pacific Court Limited
Partnership, c/o Community Corporation of Santa Monica, for an affordable housing project located
at 2209 Main Street. Forty-three low- and moderate-income housing units are to be constructed on
the site. This is a 55-year loan with 1% interest rate per annum. Payments are to be made from
residual receipts. At June 30, 2008, $6,774,763 had been disbursed to the borrower.
f. A revised promissory note in the amount of $3,350,000 was executed with 1424 Broadway
Apartments Limited Partnership, c/o Community Corporation of Santa Monica, for an affordable
housing project located at 1424 Broadway/1512 15th Street. This is a 55-year loan with 3% interest
rate per annum. Payments are to be made from residual receipts. At June 30, 2008, $3,350,000 had
been disbursed to the borrower.
Downtown Redevelopment Fund
g. Promissory notes in the amount of $4,458,033, $1,691,967 and $950,000 for a total of $7,100,000
were executed with 26 th and Santa Monica Family Housing Limited Partnership, c/o Community
Corporation of Santa Monica, for an affordable housing project located at 1349 26 th Street. Fortyfour
low- and moderate-incoming housing units are to be constructed on the site. They are 55-year
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