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AUTHORIZE FACADE IMPROVEMENT FORGIVABLE LOAN OF $100,000 TO WATERFRONT WAREHOUSE LLC FOR THE PROPERTY LOCATED AT 445 WEST WEBER AVENUE
recommended action
RECOMMENDATION
It is recommended that the City Council adopt a resolution:
1. Authorizing a Facade Improvement Forgivable Loan to Waterfront Warehouse LLC for the property located at 445 West Weber Avenue in the amount of $100,000; and
2. Authorizing the City Manager, or designee, to take all actions necessary and appropriate to carry out the purpose and intent of the resolution.
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Summary
The owner of the property, Waterfront Warehouse LLC, has applied for a Commercial Facade Improvement Forgivable Loan to make exterior improvements to the property located at 445 West Weber Avenue (Attachment A - Vicinity Map; Attachment B - Property Photos; Attachment C - Rendering of Proposed Improvements). The total cost of the project is approximately $150,000. The financial assistance requested from the City of Stockton is $100,000, which will be allocated from the federally funded Community Development Block Grant program. The property owner will contribute $50,000 toward the project, which meets the matching funds requirement within the Commercial Facade Improvement Forgivable Loan Program (Facade Improvement Program) guidelines. The proposed project will enhance the appearance of the building while preserving its historic character and have a positive impact on the surrounding properties.
DISCUSSION
Background
In 1988, City Council adopted the Community Development Block Grant Commercial Loan Program. The program included the Facade Improvement Program and the Emergency Grant Program. The adoption of these programs provided funds to improve the downtown area. At that time, the Facade Improvement Program was limited to the Central Stockton Redevelopment Area and was limited to $10,000 as a one-time loan per commercial property.
In 1999, City Council authorized revisions to the Commercial Loan Program, which included changes to the Facade Improvement Program. These changes allowed larger properties the ability to receive additional financial assistance in improving their facades. For every 50 linear feet of building frontage, a property is eligible for a $10,000 base loan. A property owner may qualify for an additional base loan so long as they contribute at least $5,000 (a maximum of $10,000) in matching funds for each additional base loan obtained.
The total cost of this project is $150,000 and, of this amount, $50,000 is in the form of five (5) $10,000 base loans from the City with an additional $50,000 in matching funds for the project. The property owner is responsible for the remaining $50,000, which is their matching funds obligation under the program guidelines. The following table demonstrates the breakdown of funding for this project:
CITY PROPERTY TOTAL
Base Grant #1 $10,000 -- $ 10,000
Matching Funds $10,000 $ 10,000 $ 20,000
Base Grant #2 $10,000 -- $ 10,000
Matching Funds $10,000 $ 10,000 $ 20,000
Base Grant #3 $10,000 -- $ 10,000
Matching Funds $10,000 $ 10,000 $ 20,000
Base Grant #4 $10,000 -- $ 10,000
Matching Funds $10,000 $ 10,000 $ 20,000
Base Grant #5 $10,000 -- $ 10,000
Matching Funds $10,000 $ 10,000 $ 20,000
TOTAL $100,000 $50,000 $150,000
Present Situation
Waterfront Warehouse LLC purchased the Waterfront Warehouse, a two-story commercial building located at 445 West Weber Avenue, in 2018. Waterfront Warehouse LLC has requested financial assistance in the amount of $100,000 for facade improvements to the property. The subject property is within the former West End Redevelopment Area and is eligible for the Facade Improvement Program. As noted above, the Facade Improvement Program eligibility is based on location, matching funds, and a commitment to maintain the exterior of the building, keeping it free of graffiti and other blighting influences. Beyond these basic eligibility criteria, facade loans are considered at the request and initiative of the applicants, as well as available funding per fiscal year.
This facade improvement project involves exterior renovations that is consistent with the City’s Design Review Guidelines. The proposed improvements as part of the facade improvement project include painting the entire building, including the metal roofs above the ground floor window walls; and replacing the canvas awnings.
The total project cost is $150,000. Under the Facade Improvement Program described above, this project is eligible for up to $100,000 in facade loan funds. The requested assistance will be provided in the form of a forgivable loan in the amount of $100,000 to be financed in accordance with the program guidelines over a six (6) year term at 10% simple interest. The property owner is responsible for the remaining $50,000 for the project.
Under this program and per the Facade Improvement Program guidelines, the principal and interest payments are forgiven on an annual basis so long as the property owner maintains the exterior of the building, keeping it free of graffiti and other blighting influences.
The anticipated project will improve the appearance of the building and have a positive impact on the surrounding properties and waterfront landscape. This project encourages and complements the investment of private sector funds.
ENVIRONMENTAL CLEARANCE
This project is exempt from the requirements of the National Environmental Protection Act (NEPA) and has been determined to be categorically excluded under Title 24 of the Code of Federal Regulations - Housing and Urban Development, Section 58.35 (a)(iii). City staff determined that the proposed improvements will not have an adverse effect on historic properties. The California State Historic Preservation Office has concurred with this determination pursuant to 36 Code of Federal Regulations, Part 800 (§106).
FINANCIAL SUMMARY
This action will have no impact on the General Fund as the program is supported through Federal Housing and Urban Development Department funding. Sufficient funds are available in account number 054-8521-640, Community Development Block Grant Commercial Rehab Loans, for the $100,000 forgivable loan, which will leave a balance of $110,000 for additional facade loans under this funding for FY 2019-20.
Attachment A - Vicinity Map
Attachment B - Property Photos
Attachment C - Rendering of Proposed Improvements