HomeMy WebLinkAboutCity Council Resolution 2589 RESOLUTION NO. 2589
A RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF SARATOGA APPROVING A
SUBORDINATION AGREEMENT WITH SARATOGA
COURT, INC.
WHEREAS, on or about July 31, 1984, the City of Saratoga made a loan to
Crescent Terrace, Inc., a California nonprofit corporation, in the amount of $50,000,
to finance the acquisition of Saratoga Court Apartments and the operation of such
property as a low-income senior citizen project, such loan being combined with a loan
from the County of Santa Clara to Crescent Terrace, Inc. in the amount of $250,000;
and
WHEREAS, Saratoga Court, Inc., a California nonprofit corporation, is the
successor in interest to Crescent Terrace, Inc.; and
WHEREAS, the Mid Peninsula Housing Coalition, one of the principals in
Saratoga Court, Inc., desires to purchase the ownership interest in the project held by
the "for profit" investor; and
WHEREAS, the funds for the proposed buy out will be provided by a new loan in
the amount of $27 1,000 from the Low Income Housing Fund, a nonprofit organization;
and
WHEREAS, the Mid Peninsula Housing Coalition has represented to the City that
current income from the project is sufficient to pay the combined debt service on the
existing loans against the property and the proposed new loan; and
WHEREAS, the Mid Peninsula Housing Coalition has requested the City to
subordinate its existing loan to the new loan from the Low Income Housing Fund, and
has presented to the City a proposed form of Subordination Agreement to accomplish
such purpose, a copy of which is attached to this Resolution as Exhibit "A" and
incorporated herein by reference; and
WH~-REAS, the County of Santa Clara has approved the subordination of its loan
to a new loan from the Low Income Housing Fund to Saratoga Court, Inc., and has
executed the Subordination Agreement,
WH!~-REAS, The City Council hereby finds and determines that:
(a) The proposed acquisition will result in the entire ownership interest
in Saratoga Court Apartments being held by a nonprofit corporation.
(b) The proposed acquisition will facilitate the continued operation of
Saratoga Court Apartments as a low income senior citizen project.
(c) The new loan by the Low Income Housing Fund does not constitute a
refinancing of any existing indebtedness against the property so as to
make the loan from the City immediately due and payable.
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NOW, THEREFORE, be it resolved as follows;
1. The Subordination Agreement attached hereto as Exhibit "A' is hereby
approved.
2. The Mayor and City Clerk are hereby authorized and directed to execute
the Subordination Agreement for and on behalf and in the name of the City of
Saratoga and to deliver the same to Santa Clara Land Title Company, together with a
certified copy of this Resolution.
· · · ·
PASSED AND ADOPTED at a regular meeting of the City Council of the City of
Saratoga held on the 2tEl day of ~st , 1989, by the following vote:
AYES: Counci~rs ~alde~_s~n, Moy~s~ .P~te. rs~n, Stutzman and ~yor Cleven. ger
NOES: None
ABSENT: None
ATTEST:
City Clerk. ~
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