Town approves TEFRA hearing resolution for Pacific Crest Commons; CMFA bond issuance not to exceed $35 million

The Truckee Town Council on March 12 held the public hearing required by the Tax Equity and Fiscal Responsibility Act (TEFRA) and unanimously adopted a resolution consenting to the issuance of tax-exempt revenue bonds by the California Municipal Finance Authority (CMFA) for the Pacific Crest Commons affordable rental-housing project, staff said.

What the action does: the council's resolution does not make the town the borrower or guarantor of the debt; it satisfies federal and state notice requirements so that CMFA may issue tax-exempt revenue bonds in an amount not to exceed $35,000,000 for the benefit of Truckee Pacific Crest Associates (the project sponsor). Town staff told council the initial issuance is expected to be closer to $21,000,000; the not-to-exceed figure allows room for supplemental allocation if project costs rise and avoids a second TEFRA hearing.

Project context: the Pacific Crest Commons project is planned for the former CHP site on Highway 89 South and is expected to provide 55 affordable rental units. The developer has received tax-credit financing and previously secured just over $1.2 million in local match funding, staff said. Several units will be set aside as permanent supportive housing and project-based vouchers will support deeply affordable units; staff and the developer confirmed 10 units at 30% area median income are designated as supportive housing.

Financing mechanics and town benefit: CMFA will issue the bonds and the borrower (the project sponsor) will remain solely responsible for debt repayment; the town bears no liability for the bonds. CMFA's customary issuance fee is expected to be roughly $55,000; as a matter of practice CMFA returns 25 percent of issuance fees to the municipality where a project is located. Town staff recommended—and the council approved—designating the town's share of the issuance fees (estimated at $13,950) to the town's housing-designation fund for future housing programs.

Council vote: Council adopted the TEFRA resolution by unanimous voice vote following a public hearing. The motion as moved and seconded followed staff recommendation; the clerk recorded the item as passing unanimously.

What's next: the project team will continue to finalize allocations and begin closing on financing. Staff noted that the CMFA issuance is a not-to-exceed authorization; the actual bond amount and terms will be finalized in subsequent transaction documentation and will be the financial responsibility of the borrower, not the Town of Truckee.