HomeMy WebLinkAbout03/01/1988, 6 - REHABILITATION LOAN PROGRAM FOR HISTORIC RESIDENTIAL BUILDINGS THIS IS THE SAME REPO''— THAT WAS SENT TO YOU FOR THE ? X88 COUNCIL MEETING.
ISI ,I NOTE: EXHIBITS B & C ARE IN THE COUNCIL OFFI(._ r'OR MEETING DATE-
city O� san Luis oBispo INSPECTION.
COUNCIL AGENDA REPORT ITEM OPVN
FROM: Michael Multari,'Community Development Director By: Terry Sanville�s
SUBJECT:
Rehabilitation Loan Program for Historic Residential Buildings
CAO RECOMMENDATION:
resolution
Adopt guidelines for the rehabilitation loan program; authorize the mayor to sign
agreement with Bank of America for loan processing; adopt resolution revising the
classification of properties in Historical Districts.
BACKGROUND:
Discussion
In February 1987 the City Council adopted Historical Preservation Program Guidelines
(Resolution 6157). These guidelines call for the creation of a "Rehabilitation
Assistance Program" to help property owners with the cost of restoring historic
residential buildings.
The staff distributed RFP's to banks and savings and loans for assistance in
administering a loan program. Bank of America responded with a proposal. The staff has
worked with bank officials to negotiate the content of the services agreement (see
attached Exhibit B). Meanwhile, the Cultural Heritage Committee and the staff completed
administrative guidelines (see attached Exhibit A). And as a final part of the program,
the CHC finished its survey of contributing properties within historical districts (see
attached Exhibit Q.
These three elements (agreement with the bank, loan program guidelines, and listing of
contributing properties) make up the rehabilitation loan program that is recommended by
the CHC.
Significant Impact
The 1987-89 Financial Plan earmarks $50,000 each year to fund this rehabilitation
program. These funds would be deposited with Bank of America to support the program. It
is anticipated that much of these funds will be recycled. It is hoped that this program
will help retain important historic houses and have a positive impact on neighborhoods.
Cons_enuences of Not Taking the Recommended Action
If the City Council wants to amend the proposed program, it may delay its
implementation. If the council decided to abandon or defer the loan program concept, the
financial responsibility for rehabilitation would remain with private property owners.
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COUNCIL AGENDA REPORT
PROGRAM EVALUATION
1. The Agreement With Bank Of America (Exhibit A)
This agreement is similar to agreements between Bank of America and over 40 other
California communities. It presents two financing options: collateralized loans and
interest subsidy loans. With the "collateralized loan" option, the city's money is being
used as collateral for a loan made with bank funds. The bank assumes varying levels of
risk and the city provides the security. With the "interest subsidy" option, city funds
would be used to write down a loan to below market rates. The city will indicate
which program option to use with any given application. Leveraging of private funds will
be a key consideration in considering program options.
This is the first time that the city has worked directly with a financial institution to
establish such a program. Therefore, we anticipate some sorting out of the program
during its first year. The agreement with Bank of America would be in effect for one
year. Program changes would be possible as part of any subsequent renewal of the
agreement.
The City Attorney has reviewed the content and format of the agreement and the attached
amendment and and has no objections to its execution.
2. The Loan Program Guideline (Exhibit B)
Consistent with early direction provided by the City Council, the staff prepared loan
program guidelines that would direct the city's acceptance and processing of
applications. Some of the key features of the guidelines are outlined below:
(a) Program Objectives: The objective of this program is (through financial assistance)
to help stabilize historic residential buildings that might be lost if rehabilitation is
not pursued. This focused objective is important to understand because of the program
has limited funds. Also, this objective helped define the programs eligible activities.
(b) Eligible Properties: The loan program would be available to the owners of historic
residential properties. These properties include 87 included on the Master List of
Historical Resources (adopted in 1983) and 340 contributing properties within the
city's three historical districts. These listings are included in the appendix A of the
proposed guidelines.
(c) Administration: The Cultural Heritage Committee (CHC) and staff would review all
applications, rank them using criteria set forth in the guidelines, and approve or deny
them. A 60-day application period would be established. CHC action on all applications
would take place within 60 days of the close of the application period.
Because both the city and Bank of America is involved in this program, it is important
that administration be as streamlined as possible so that approval time is kept as short
as possible. An extended review and approval process could discourage applicants.
3. Contributing Properties Listing (Exhibit C)
In 1983 the City Council adopted a listing of "contributing properties" within the three
proposed Historical Preservation Districts. When the city actually adopted districts in
CI-W or San Lacs OBISPO -
=ON COUNCIL AGENDA REPORT
1987, the boundaries had been substantially expanded -- primarily to include additional
residential areas southeast of the downtown. After the districts were adopted it was
necessary to expand the classification of properties to include all buildings within the
districts. Every property (at total of 858) has been given one of four
classifications. The definition of each classification and the factors used to establish
them are shown on attached Exhibit C. Included in Exhibit C is the numeric coding of
Historic Resource Properties (the 152 properties) that lie within district boundaries.
No changes have been proposed to this coding at this time.
The completion of this survey work is needed to identify properties eligible for this
rehabilitation loan program. Owners of 340 contributing properties may apply for
assistance.
The CHC continues to evaluate the historic or architectural importance of buildings
within the city as an ongoing work task. The CHC has emphasized that anyone who feels
that there have been errors or omissions in preparing the listings my request further
consideration by the committee.
4. Program Implementation
If the City Council adopts the proposed program documents, the following activities would
happen:
(a) Staff would work with local Bank of America officials to set up local loan processing
procedures.
(b) Within 30 days, the city would transfer $50,000 to the Bank of America to be placed
in an interest-bearing "warehouse" account.
(c) The program would be advertised and a 60-day application period established.
(d) At the end of the application period, the CHC would review, rank.if necessary, and
give city authorization for assistance to priority eligible applicants.
ACTION ALTERNATIVES
The City Council may:
1. Approve the program as recommended by the CHC.
2. Suggest amendments to and approve a modified program. (Depending on what is being
amended, additional negotiations with the Bank of America might be needed.)
3. Direct staff and the CHC to pursue some other form of financial assistance program.
(The council should specify its preferences and the item would be referred back to staff
and committee for evaluation.)
4. Not adopt a financial assistance program and rely on other non-monitary forms of
assistance. (If council supports this strategy, the Historical Preservation Program
Guidelines should be amended.)
5. Continue consideration to a future meeting pending further analysis and discussion.
���n�►h►II�IIIII��I° ����U CI-W Or San .aIS OBISPO
COUNCIL AGENDA REPORT
RECOMMENDED ACTION
1. Adopt a resolution approving the administrative guidelines for the rehabilitation loan
program (Exhibit A).
2. Adopt a resolution authorizing the mayor to sign a services agreement with the Bank of
America for loan processing (Exhibit B).
3. Adopt a resolution amending Resolution 5197 (1983 Series) to adopt a classified
listing of properties within the city's three Historical Preservation Districts (Exhibit
Q.
ATTACHMENTS
Exhibit C available in the Council Office for inspection.
TS:ts
RESOLUTION NO. (1988 Series)
A RESOLUTION OF THE COUNCIL OF THE CITY
OF SAN LUIS OBISPO APPROVING AN AGREEMENT
BETWEEN THE CITY AND BANK OF AMERICA TO ADMINISTER
A PROPERTY REHABILITATION LOAN PROGRAM
WHEREAS, the city has determined that it is desirable to establish a financial
assistance program to promote the preservation of historic residential buildings;
WHEREAS, the city has determined that administration of this program should be in
cooperation with a private financial institution; and
WHEREAS, the city distributed RFPs to financial institutions and received a proposal
from Bank of America, and
WHEREAS, the city staff and the Cultural Heritage Committee reviewed the Bank's,
worked with the bank on amendments to suit the community's needs, and recommended their
approval.
WHEREAS, the Community Development Director has determined that the adoption of this
agreement is exempt from city and state EIR guidelines.
NOT, THEREFORE, BE IT RESOLVED by the Council of the City of San Luis Obispo as
follows:
SECTION 1: The Property Rehabilitation Loan Agreement, attached hereto as Exhibit
"B" and incorporated herein by reference between the City and Bank of America is
hereby approved and the Mayor is authorized to execute the same.
SECTION 2: The City Finance Director is hereby authorized to transfer $50,000 to Bank
of America from line account 001-0104-008-119 in accordance with provisions of the
attached agreement.
SECTION 3: The City Clerk shall furnish a copy of this resolution and a copy of the
executed consultant's agreement approved by it to the City Finance Director,
Community Development Director and Bank of America.
On motion of seconded by ,
and on the following roll call vote:
Y '
RESOLUTION NO. (1988 Series)
A RESOLUTION OF THE COUNCIL OF THE CITY
OF SAN LUIS OBISPO ADOPTING HISTORICAL PRESERVATION
FINANCIAL ASSISTANCE GUIDELINES
WHEREAS, on February 3, 1987, the City Council adopted Historical Preservation
Guidelines that call for the creation of a rehabilitation assistance program (Resolution
6158); and
WHEREAS, the Cultural Heritage Committee has worked with staff to prepare
administrative guidelines for providing financial assistance to the owners of historic
residential buildings; and
WHEREAS, the Community Development Director has determined that the adoption of these
guideline is exempt from city and state EIR guidelines.
NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Luis Obispo as
follows:
SECTION 1: The Historical Preservation Financial Assistance Guidelines, attached
Hereto as Exhibit "A" and incorporated by reference, are hereby adopted.
SECTION 2: The Community Development Department shall publish these guidelines and
make them available to the public.
On motion of , seconded by
and on the following role call vote:
AYES:
NOES:
ABSENT:
the foregoing resolution was passed and adopted on this _ day of 1988.
ATTEST
Mayor Ron Dunin
City Clerk Pamela Voges
RESOLUTION NO. (1988 Series)
A RESOLUTION OF THE COUNCIL OF THE CITY
OF SAN LUIS OBISPO ESTABLISHING A COMPREHENSIVE LISTING OF
HISTORIC AND NON-HISTORIC PROPERTIES
WITHIN HISTORICAL PRESERVATION DISTRICTS
WHEREAS, in February 1987 the City Council adopted an ordinance creating three
Historical Preservation Districts as part of the zoning regulations; and
WHEREAS, the Cultural Heritage Committee has completed a survey of all properties
within historical preservation districts and has classified each property as to whether
it contributes to the historical character of the district (see attached Exhibit "C");
and
WHEREAS, the purpose of CHC's survey is to identify historic properties that will be
eligible to apply for benefit programs sponsored by the city; and
WHEREAS, the Community Development Director has determined that the adoption of this
listing will not have a significant effect on the environment and has granted a negative
declaration.
NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Luis Obispo as
follows:
SECTION l: The listing of properties within Historical Preservation Districts.
attached hereto as Exhibit "C" and incorporated by reference, is hereby adopted.
SECTION 2: Resolution 5197 (1983 Series) is hereby amended to reflect the new listing
of historic properties embodied in Exhibit "C."
SECTION 3: The Community Development Department shall publish this listing and make
them available to the public.
On motion of seconded by
and on the following role call vote:
Mayor Ron Dunin
ATTEST:
City Clerk Pamela Voges
Approved
City ministrative Officer
City Att ey
AityFinance Director
Lcct : t,c
Community Development Director
AYES:
NOES:
ABSENT:
the foregoing resolution was passed and adopted on this _ day of 1988.
Mayor Ron Dunin
ATTEST:
City Clerk Pamela Voges
Approved:
City A ministrative Off icer-
Citq Attor y
Community Development Director