Vallejo successor agency reviews plan to subordinate affordability covenant so Marina Towers Annex can refinance and be rehabilitated

The successor board to the former Vallejo redevelopment agency on Thursday heard a developer's request to subordinate the city's affordable-housing covenant so Marina Towers Annex can refinance and undergo a planned rehabilitation.

Assistant City Manager Hain and Evan Laws, development manager at Vitus, told the board the annex is a low-rise senior building with one-bedroom units that is covered by a Section 8 HAP contract and needs significant repairs. Laws said the project would layer tax-credit regulatory covenants with a long-term financing package to preserve affordability and pay for renovations.

The request would allow the property's new owners to refinance through Fannie Mae and a HUD loan that together require subordination of the city's current covenant. "We are requesting approval of the presented resolution to allow for the subordination of the city's existing affordable housing covenant, in order to preserve this housing as quality and affordable housing, for years to come," Laws said during his presentation.

Why it matters: The annex houses seniors (the presenter said average resident age is 78 and average household income about $16,000). The developer told the board the Section 8 contract currently covers all units and is set to expire in October 2061; a regulatory agreement tied to tax credits would layer additional affordability protections out to roughly 2082.…