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Oxnard approves $800,000 city loan to help settle Las Cortes dispute; housing authority adds $1.2M
Summary
The City Council approved an $800,000 loan and budget appropriation to the Oxnard Housing Authority to help fund a tentative settlement for the Las Cortes housing project; the housing authority board approved related actions committing $1.2 million and writing off related bad debt.
The Oxnard City Council voted 7-0 to authorize an $800,000 loan and related budget appropriation from the general fund to the Oxnard Housing Authority to partially fund a tentative settlement involving UHC 558 Oxnard LP and the Las Cortes housing project in the La Colonia neighborhood.
Council action directed the city manager to execute a loan agreement with the Oxnard Housing Authority and to appropriate $800,000 from the fiscal year 2024-25 general fund available balance. In the same meeting the Oxnard Housing Authority’s board of commissioners voted to authorize a parallel $1,200,000 appropriation from the housing authority central fund and to approve writing off bad debt related to a prior promissory note for demolition costs.
City staff told council the loan is being structured as a standard forgivable-style loan in the affordable housing context: if the Housing Authority regains the property and carries forward housing development, the loan may be forgiven consistent with the parties’ written agreement. Staff said the funding package is intended to avoid arbitration or litigation that officials said could be costlier and would delay redevelopment.
Councilmember questions focused on the consequences of rejecting the proposal. Staff replied that a vote against the loan could kill the tentative settlement and force arbitration or litigation; that path could be more expensive and would take more time. Staff also said the loan format — a City loan to the Housing Authority rather than an outright grant — followed city practice for comparable affordable housing transactions.
The council passed the city resolution 7-0. The Housing Authority board then voted to approve its authorizing resolution and the $1.2 million appropriation; its vote carried 8-0.
City staff recommended the loan and the appropriations as a cost-effective way to resolve outstanding claims while returning the property to the Housing Authority for redevelopment. The staff report as presented to the council described the loan as a standard mechanism, a forgivable loan if the Housing Authority fulfills development conditions and recovers the asset.
Vote details: City Council — motion carried 7-0. Housing Authority board — motion carried 8-0.
