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Oceanside council approves TEFRA resolution clearing way for 240‑unit Sonterra affordable conversion
Summary
The City Council held a TEFRA hearing and voted 5‑0 to approve a resolution supporting up to $105 million in tax‑exempt bonds from the California Municipal Finance Authority to finance acquisition and rehabilitation of the Sonterra multifamily complex at 3851 Sherborne Drive and convert most units to restricted affordable housing.
Oceanside City Council unanimously adopted a resolution Dec. 17 approving the issuance of tax‑exempt bonds, not to exceed $105,000,000, through the California Municipal Finance Authority (CMFA) to finance the acquisition and rehabilitation of the Sonterra multifamily property at 3851 Sherborne Drive.
Salvador Grama, senior management analyst with the housing and neighborhood services department, told the council the project covers an existing 240‑unit apartment community and uses bond financing to secure affordability commitments. "In total, the community consists of 240 units," Grama said, adding that the financing proposal would restrict 75% of the units to households earning 80% of area median income (AMI) or less and meet a 40% requirement at 60% AMI or less. Grama said 25% (about 60 units) would remain unrestricted to accommodate existing tenants who do not meet income thresholds and that renovations would occur at unit turnover so "there will be no displacement of tenants" during the rehab.
Council members pressed staff on tenant notice and the duration of affordability. Housing staff said the financing is private and the city is not financially liable: "The bonds are secured solely by private sources related to the development," Grama said. Staff said tenant notification would begin once financing and the lender process are in place and estimated a closing in February; the minimum regulatory agreement period tied to the bonds is 15 years, though affordability could persist while bonds remain outstanding.
Deputy Mayor Joyce said the structure highlights the complexity of affordable housing finance and cautioned the council to monitor outcomes for residents. Council Member Figueroa asked that city staff be included in informal outreach and tenant information sessions where possible. Council Member Robinson moved and the council approved the resolution by a 5‑0 vote.
The council’s action satisfies TEFRA public‑hearing requirements and does not create a city debt or repayment obligation; staff said compliance monitoring would be handled by the bond issuer (CMFA) and the borrower. City staff offered to be available to assist residents with questions and to refer fair‑housing complaints to state resources.
