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
four low- and moderate-income housing units are to be constructed on the site. They are 55-year
loans with 3% interest rate per annum. Payments are to be made from residual receipts. At June 30,
2008, $3,845,726 and $1,691,967 respectively, had been disbursed to the borrower.
o. Two promissory notes, for $200,000 each, were executed with the owners of certain rental
properties. The notes were for five years at 3% interest per year, and could be renewed for five
additional five-year terms as long as the rental properties are maintained for low-and moderateincome
households. The first note was due December 22, 1993, and has been extended for the third
time to December 22, 2008 under the same terms and conditions; the second note was due
December 29, 1994, and has been extended to December 29, 2019 under the same terms and
conditions. The promissory notes are payable in full upon sale or transfer of the property (whichever
occurs first) or upon expiration of the term of the promissory notes. Upon payment to the City,
proceeds must be paid to the State of California as repayment for two $200,000 State Department of
Housing and Urban Development Deferred Payment Rehabilitation Loan Program (DPRLP) loans.
As these DPRLP loans are currently due, they have been reported as short-term loans payable on the
statement of net assets. There were no changes in the loan balances during the year ended June 30,
2008.
p. These represent non-interest bearing, limited appreciation and shared appreciation loans made
pursuant to TORCA Program guidelines to assist low- and moderate-income households purchase
their rental units. As of June 30, 2008, the outstanding balances of such loans total $1,301,685.
q. A promissory note in the amount of $1,200,000 was executed with Ocean Park Community Center
for congregate housing and emergency shelter for very low-income use, located at 1751 Cloverfield
Blvd. This loan is for the acquisition and rehabilitation of the site. This is a 55-year loan with
5.98% interest rate per annum with a two-year deferral period. Payments are to be made from
residual receipts. At June 30, 2008, $1,200,000 had been disbursed to the borrower.
r. A revised promissory note in the amount of $6,745,807 was executed with Community Corporation
of Santa Monica for an affordable housing project located at 3021-3031 Santa Monica Blvd. This
loan is for the acquisition, predevelopment expenses and construction of future low- and moderateincome
housing. This is a 0% loan with the principal amount due and payable after a two-year
deferral period. At June 30, 2008, $6,745,807 had been disbursed to the borrower.
s. A promissory note in the amount of $1,161,185 was executed with Community Corporation of
Santa Monica for an affordable housing project located at 1342 Berkeley Street. This loan is for the
acquisition and predevelopment expenses for future low- and moderate-income housing. This is a
0% loan with the principal amount due and payable after a two-year deferral period. At June 30,
2008, $924,478 had been disbursed to the borrower.
t. Two promissory notes, one in the amount of $5,870,000 and one for $1,300,000 were executed with
Step up on Fifth, L.P. for an affordable housing project located at 1548 Fifth Street. These loans are
for the acquisition and construction of the site. This is a 55-year loan with a simple interest rate of
4% per annum. Payments are to be made from residual receipts. At June 30, 2008, $5,870,000 and
$1,300,000 respectively, had been disbursed to the borrower.
u. A promissory note in the amount of $4,234,507 was executed with The Tahiti, L.P. c/o Community
Corporation of Santa Monica for an affordable housing project located at 2411-2423 Centinela
Avenue. The loan is for the construction of 36 affordable rental housing units. This is a 55-year
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