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Council clears tax‑exempt bond TEFRA hearing to finance rehabilitation of 125‑unit Sereno Village Apartments
Summary
By unanimous vote the council approved a TEFRA hearing that allows the California Municipal Finance Authority to issue revenue bonds (up to $20 million) for Eden Housing’s renovation of Sereno Village; the project restarts affordability restrictions for another 55 years and imposes an indemnity on the borrower so the city bears no liability.
The City Council held a Tax Equity and Fiscal Responsibility Act (TEFRA) hearing and approved a resolution consenting to the California Municipal Finance Authority’s issuance of tax‑exempt revenue bonds not to exceed $20 million on behalf of Eden Housing for the rehabilitation of Sereno Village Apartments, a 125‑unit affordable property at 750 Serena Drive.
City staff and CMFA representatives explained that the city will not issue debt or bear financial liability for the bonds; the financing is between the developer/borrower and private lenders with CMFA acting as the issuer. The bond proceeds will be used to repay existing loans on the property and fund approximately $13.5 million in rehabilitation work, including unit interiors, windows, site work and conversion of some systems (for example replacing gas water heaters with electric units in the community building).
CMFA and Eden representatives said the financing includes a restated regulatory agreement that will extend affordability covenants for an additional 55 years, ensuring existing residents can remain in place through the rehabilitation. Councilmember Matias requested that compliance reports submitted to the funding agency be forwarded to the city manager; the motion included that condition and the council adopted the resolution unanimously.
What’s next: sponsors indicated they expect to close the financing in the next two months and begin rehabilitation work; staff will present amended loan documents for council consideration at a future hearing.
