California Comprehensive Annual Financial Report - City of Temecula

City of Temecula
Notes to Financial Statements (Continued)
Note 12: Affordable Housing Grant and Loan Agreements (Continued)
The Agency has a note receivable in the amount of $3,300,000 from D’Alto Partners LLC,
a California Limited Liability Company (the LLC). The funds were loaned to the LLC under
an Owner Participation Agreement (the OPA) under which the LLC was to develop and
operate a mixed used development including providing affordable housing. The note is
secured as second trust deed for a term of 55 years and will be forgiven if there are no
violations of the covenants of the OPA. If there is a violation of covenants of the OPA, the
Agency can require full payment of the principal.
The Agency has a note receivable in the amount of $2,615,000 from 28500 Pujol Street, a
California Limited Partnership (the Partnership). The funds were loaned to the Partnership
under a Disposition and Development Agreement (the DDA) dated in 2003 under which
the Partnership developed affordable housing. The note is due 55 years from the date of
the note (August 1, 2004) with interest accrued at a rate of 3%. Fifty percent of the
residual receipts as defined in the DDA for each calendar year are due March 15 of the
following year. Any residual receipts are to be applied to the accrued interest. Any unpaid
interest is added to the note. As of June 30, 2009, the total due from the Partnership
amounted to $3,024,164 which included $409,164 of accrued interest.
The Agency has a note receivable in the amount of $305,000 from Temecula Gardens,
L.P., a California Limited Partnership (the LP). The funds were loaned to the LP under an
Owner Participation Agreement (the OPA) under which the LP was to develop real
property. The note is secured by a deed of trust encumbering the property with interest
accrued at 1%. As of June 30, 2009, the total due from the Partnership amounted to
$338,550 which included $33,550 of accrued interest.
Note 13: Non Commitment Debt
Multi-Family Housing Revenue Bonds
On April 25, 1996, the Temecula Redevelopment Agency issued $2,427,500 of Multifamily
Housing Revenue Bonds. The proceeds of the issuance were loaned to the Coachella
Valley Housing Coalition (the "Borrower"), a California nonprofit public benefit corporation,
to enable the Borrower to acquire and rehabilitate a 150-unit multifamily housing rental
apartment development located in the City. A portion of the housing units is rented to
persons of very low income. The Borrower makes loan payments to the trustee, an
assignee of the Agency, of amounts sufficient to pay in full all principal and interest due on
the bonds. The bonds are a special obligation of the Agency payable solely, from
revenues of the Borrower and other funds pledged pursuant to the trust indenture. At
June 30, 2009, these bonds had an outstanding balance of $1,124,250.
Special Tax Refunding Bonds
On June 11, 1998, the Community Facilities District No. 88-12 of the City of Temecula
(Ynez Corridor) issued $18,690,000 of Special Tax Refunding Bonds. The 1998 Series A
Bonds were issued to (1) refund the outstanding Community Facilities District No. 88-12 of
the County of Riverside (Ynez Corridor) Series 1992 Special Tax Bonds, (2) fund a
reserve fund for the 1998 Series A Bonds, and (3) pay the costs of issuing the 1998 Series
A Bonds. The 1998 Series A Bonds are payable from the Special Tax revenues derived by
the District from the levy of the Special Taxes, and are secured by a first pledge of all of
the Special Tax revenues and monies deposited in certain funds. At June 30, 2009, these
bonds had an outstanding balance of $10,585,000.
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