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A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF POMPANO BEACH, FLORIDA, APPROVING AND AUTHORIZING THE PROPER CITY OFFICIALS TO EXECUTE FIRST AMENDMENTS TO THE DEVELOPMENT AGREEMENT AND DECLARATION OF RESTRICTIONS BETWEEN THE CITY OF POMPANO BEACH AND MARQUIS PARTNERS, LTD. TO BUILD A 100-UNIT AFFORDABLE HOUSING DEVELOPMENT AT 1850 DR. MARTIN LUTHER KING, JR. BLVD., TO CONVERT THE $407,750 GRANT FUNDING PREVIOUSLY APPROVED IN CITY RESOLUTION 2020-80 TO A NONRECOURSE LOAN EVIDENCED BY A PROMISSORY NOTE AND SECURED BY A MORTGAGE WITH RECAPTURE PROVISIONS, AND APPROVING AND AUTHORIZING THE PROPER CITY OFFICIALS TO EXECUTE SUBORDINATION AGREEMENTS REQUIRED BY CITIBANK, N.A., FLORIDA HOUSING FINANCE CORP., AND BROWARD COUNTY AS SENIOR LENDERS TO THE SUBJECT AFFORDABLE HOUSING DEVELOPMENT; PROVIDING AN EFFECTIVE DATE.
(Fiscal Impact: N/A)
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(Staff Contact: Miriam Carrillo/Vincent Wooten)
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Summary Explanation/Background:
On December 10, 2019, the City Commission of the City of Pompano Beach, Florida passed and adopted Resolution 2020-80 approving and authorizing the proper city officials to execute a Development Agreement between the City of Pompano Beach and Marquis Partners, Ltd. to build a 100-unit affordable housing development at 1850 Dr. Martin Luther King, Jr. Blvd., to provide financial assistance in an amount not to exceed $607,750 in the form of a $407,750 grant and $200,000 loan with recapture provisions and to accept the declaration of restrictions; providing an effective date. The Development Agreement also specified that the Developer contribute $200,000 toward the construction of a new BSO Sub-Station located on the City owned parcel at the southwest corner of NW 27th Avenue and NW 4th Court which has been funded. The transaction Closed January 31, 2020.
According to the attached letter dated March 20, 2020 from Patricia K. Green of Stearns Weaver, Miller, Weissler, Alhadeff and Sitterson, P.A. the Developer is requesting to convert/recast that grant documentation into agreements that will be similar to the attached note and mortgage, to evidence the $407,750 as a loan from the City. Since a grant is, by its nature, not recoverable by the City unless there is a default under the affordability restrictions that attend the grant, the Developer wants to preserve that ability to forgive the debt, when this is re-cast as a loan. This will require an amendment to the governing Development Agreement and accompanying security instruments in connection with the Development.
Therefore, the Resolution shall authorize the proper City officials to execute the following list of documents enumerated below:
1. City’s acceptance of:
a. a new Promissory Note for $407,750, and
b. a new Mortgage to secure that Note (to recast the existing grant as a loan).
2. Modification of the existing Development Agreement between the City and Marquis Partners, Ltd.
3. Modification of the existing Declaration of Restrictions in favor of the City by Marquis Partners, Ltd.
4. City’s signature on the following Subordination Agreements:
a. Subordination in favor of Citibank (for $200K loan)
b. Subordination in favor of Citibank (for $407,750 loan)
c. Subordination in favor of FHFC (for SAIL, ELI and NHTF loans, for $200,000 mortgage)
d. Subordination in favor of FHFC (for SAIL, ELI and NHTF loans, for $407,750,000 mortgage)
e. Subordination in favor of Broward County (for $200K loan)
f. Subordination in favor of Broward County (for $407,750K loan)
Origin of request for this action: OHUI
Fiscal impact and source of funding: N/A
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