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City Council for the City of Colton <br />Agenda Report <br />To: Mayor and City Council <br />From: Hani Gabriel, Acting Economic Development Director <br />Date: July 6, 1993 <br />Subject: RESOLUTION APPROVING CITY LOAN FOR CONVERSION OF RANCHO <br />MEDITERRANIA MOBILEHOME PARK <br />Background <br />At its Regular Meeting of June 15, 1993, the Redevelopment Agency approved a short-term <br />loan from the City in the amount of $600,000 to finance the closing of escrow for conversion <br />of Rancho Mediterrania Mobilehome Park. To formalize this transaction, it is necessary that. <br />the. City Council adopt the attached Resolution approving the Loan and, Repayment Agreement <br />(Exhibit "A") <br />Discussion <br />The loan, not to exceed $600,000, is from the City's Electric Utility Fund. Loan terms require <br />that the loan be repaid in full to the City within six months from the receipt of the loan funds, <br />including four and one-half percent (4.5%) interest per annum. Loan repayment is from <br />revenues generated by individual mobilehome conversions to homeownership and net <br />operating income generated from the Agency's operation of the Park during the term of the <br />loan. <br />Financial Impact <br />Other debt incurred by the mobilehome conversion project is subordinate to the City loan. All <br />conversion revenues and net operating income are pledged toward repayment of the City loan <br />before repayment of additional debt. <br />Recommendation <br />Staff recommends adoption of the attached Resolution approving the Agreement for Loan and <br />Repayment for $600,000 from the Electric Utility Fund. <br />Report prepared by: Wendy Jo Holland, Project Manager <br />Attachment: Resolution <br />Exhibit "A" Agreement for Loan and Repayment <br />Concurrrenc <br />f <br />City pager <br />IshAwpwin\meetiQ;\ccunc76.rp1 � <br />June 30, 1993 - <br />