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HomeMy WebLinkAbout01/08/2025 - Meeting Materials SPECIAL MEETING OF THE COMMUNITY REINVESTMENT ADVISORY COMMITTEE Wednesday, January 8th, 2025 4:00 p.m. 451 S State Street, Room 118 Salt Lake City, UT 84111 https://us06web.zoom.us/j/87069626829?pwd=QmN6MH RIcUIYMONZWTFOb3FgTOgOUT09 AGENDA 1. Roll Call 2. Announcements by the Staff A. Staff Updates 3. Business A. Commercial Development Loan Program (CDLP) Policy- Kristina Harrold, Project Manager; Ashley Ogden, Senior Project Manager. Members will receive an update on the Commercial Development Loan Program (CDLP) and may provide comments and feedback to Agency Staff. 4. Adjournment People with disabilities may make requests for reasonable accommodation no later than 48 hours in advance to attend this Community Reinvestment Advisory Committee. Accommodation may include alternate formats, interpreters, and other auxiliary aids. This is an accessible facility. For questions, requests, or additional information, please contact the CRA at 801-535-7240. MAYOR ERIN MENDENHALL DANNY WALZ Executive Director -� _=�� Director SALT LAKE CITY COMMUNITY REINVESTMENT AGENCY STAFF MEMO DATE: January 3,2025 PREPARED BY: Kristina Harrold,Project Manager Ashley Ogden, Senior Project Manager RE: Commercial Development Loan Program(CDLP)Policy REQUESTED ACTION: Policy Discussion POLICY ITEM: CRA Commercial Assistance Programs BUDGET IMPACTS: None at this time EXECUTIVE SUMMARY: While the Salt Lake City Community Reinvestment Agency(CRA)has a robust set of housing policies and programs to support affordable housing development,the CRA seeks to create a corresponding set of commercial assistance policies and programs to support the local businesses and non-profits that contribute to the health and vibrancy of the City's neighborhoods. In August 2024,the RDA(now named the CRA)proposed to the Board of Directors (Board)a suite of potential Commercial Assistance Programs to address the real estate and financial needs of local businesses and non-profits in CRA project areas. This memo serves as an overview of Staff s policy proposal to create a CRA Commercial Development Loan Program(CDLP). The following memo outlines the policy proposal,which will be further refined through Board discussions. ANALYSIS &ISSUES: In August 2024, Staff presented to the Board a potential package of Commercial Assistance Programs intended to respond to the real estate and financial needs of local businesses and non-profits. At the time, Staff proposed to a)revise the existing Loan Program to prioritize the funding of commercial projects that support the RDA's Guiding Framework for Mission and Values and b)expand the existing Granary District Adaptive Reuse Program to all CRA project areas.As Staff began to work on a revised Loan Program policy, it was determined that the CRA Commercial Assistance Programs could be made more efficient by consolidating the two programs into one. As such, Staff recommends repealing both the existing Loan Program and Granary District Adaptive Reuse Program policies and replacing them with the proposed CDLP policy. SALT LAKE CITY CORPORATION 451 SOUTH STATE STREET,ROOM 115 WWW.SLC.GOV-WWW.CRA.SLC.GOV P.O.BOX 145518,SALT LAKE CITY,UTAH 84114-5518 TEL 801-535-7240-FAX 801-535-7245 Proposed Changes to Existing Loan Programs The proposed CDLP is designed to complement the structure and administration of the Housing Development Loan Program(HDLP),but with a focus on the financing of commercial and mixed-use development that advances the CRA's Guiding Framework for Mission and Values. To maintain the incentive provided through the Granary District Adaptive Reuse Program,it is proposed that projects that involve the preservation,rehabilitation, or repurposing of a vacant,underutilized, or economically challenged building be eligible for forgiveness of up to $200,000 of the loan principal amount. The chart below compares features of the existing Loan Program with those of the proposed CDLP,with modifications and additions highlighted in bold. 'Existing Program Proposed Progra Threshold Project is either: Projects must meet all of the following Requirements -Located within a project area and meet at requirements: least one Project Area Objective as provided -Be located within a CRA project area and meet at in the most recent Project Area Strategic least one Project Area Objective as provided in the Plan, OR most recent Project Area Work Plan. -Located within Salt Lake City and include -Be prepared to break ground within 12-15 housing units affordable to households months of receiving conditional funding earning 80%AMI or below. approval. -Meet a minimum of two(2) additional Qualifying Livability Benchmarks:Leveraging, Permanent Job Creation, Commercial Vitality, or Ownership. -Mixed-use developments that contain a residential use may supplant one of the required Qualifying Benchmarks with one of the adopted priorities of the Housing Development Funding Strategy for the current fiscal year. Eligible New construction,building rehabilitation, Commercial and mixed-use development projects, Project energy efficiency upgrades including new construction,building rehabilitation, Types significant site work, and other improvements that will remain with and benefit the property long- term. Eligible Construction costs(hard costs), site Construction costs(hard costs).Use of funds for Costs improvements associated with development property acquisition,infrastructure improvements, project, and short-term land acquisition for environmental remediation,demolition, or project- affordable housing development. Use of related soft costs will be considered on a case-by- funds for environmental case basis,if part of a larger development remediation/demolition considered on a case- project. by-case basis. Eligible Applicants must be the title owner or have Applicants must be the title owner or long-term Applicants site control of the property. ground lessee of the property. Current or prospective commercial tenants who lease all or a portion of the property may also apply. Existing Program Proposed Program Design/ Projects must support the Agency's Design Projects shall comply with all applicable Salt Lake Sustainability Guidelines and comply with applicable Salt City and CRA policies,ordinances,and codes. Requirements Lake City building codes and ordinances. Projects shall comply with the CRA's Sustainable Development Policy Tenant N/A For residential displacement,the applicant shall Displacement submit a relocation plan that complies with applicable federal, state, and local policies for temporary or permanent displacement. For commercial displacement,the applicant shall disclose the number of commercial units lost, heir respective sizes (in sf), names of impacted businesses, efforts made to accommodate them elsewhere,and other relevant information as requested in the application for funding. Loan Gap Financing: Maximum Loan Amount: Amount Loan maximums limited to demonstrated gap All projects shall have a maximum loan amount in available financing to cover project costs of$2,000,000. and shall be sized to meet lower of a debt coverage ratio(DCR)of 1.1 or loan to value Gap Financing: (LTV)of 95%. Loan maximums limited to the demonstrated gap in available financing to cover project costs and shall Primary Financing: be sized to support a debt service coverage ratio In limited instances where the RDA is primary(DSCR)of 1.1 or a loan to value(LTV)of 95%, lender,loans shall be sized to meet lower of a inclusive of all debt on the project,whichever results CR of 1.2 or LTV of 90%. in the lower loan amount. Primary Financing: When the RDA's contribution is greater than 60% of the project's total development costs, loans shall be sized to support a DSCR of 1.2 or a TV of 90%, inclusive of all debt on the project, whichever results in the lower loan amount. Term The standard term is five(5)years with The standard term is five (5)years with option to option to extend to 10 years with interest rate extend to 10 years with interest rate increase of 2% increase of 2%in year six(6). The maximum in year six(6). term for short-term affordable housing land acquisition loans shall be two(2)years. Amortization The standard amortization period is up to 20 The standard amortization period is up to 20 years. Period years.Affordable housing development projects may qualify for amortization period that is equal to duration of affordability restrictions placed on residential units,up to 30 years. Interest Rate The base interest rate is 3%+Treasury Yield The standard interest rate is 3%+Treasury Yield Curve Rate at loan closing. Curve Rate,to be locked in within a month of loan closing. Existing Program AProposed Program Possible Reduction to base interest rate available if Reduction to the standard interest rate is available Interest Rate project meets one or more of 11 possible for projects that meet additional Livability Reductions Public Benefit criteria. For each criterion Benchmarks beyond the threshold requirements, as fulfilled,project shall receive 0.5% provided in the administrative guidelines,with the reduction,with a maximum reduction of 3%. ability to reduce the interest rate to a minimum of 3%. Adaptive Projects that preserve or repurpose a building Projects that involve the preservation, Reuse through the conversion of existing structures rehabilitation,or repurposing of a vacant, Incentive into new land uses that contribute positively underutilized,or economically challenged to its surrounding neighborhood are eligible building may be eligible for forgiveness of up to for a 0.5%reduction to the standard interest $200,000 of the loan principal amount. rate. Loan Finance Committee provides conditional loan Finance Committee provides conditional loan Approval approval for loans totaling$500,000 or less. approval for loans totaling$500,000 or less. Loans that exceed$500,000 or that involve Loans that exceed$500,000 or that involve an an adjustment from standard loan terms must adjustment from standard loan terms must be be provided conditional loan approval by the provided conditional loan approval by the Board. Board. Loan In extenuating circumstances and on a case- In extenuating circumstances and on a case-by-case Modifications by-case basis,Executive Director may basis,Director of the CRA may provide a provide a temporary forbearance or temporary forbearance or deferment up to one(1) deferment up to one(1)year; requests that year; requests that are longer than one year require are longer than one year require approval by approval by the CRA Board. the Board. Director of the CRA may authorize an extension The Board may also consider and act upon of the repayment term by an additional five(5) requests for loan write-down or forgiveness. years(beyond the term that was initially approved),and/or re-amortization up to 30 years. CRA Board may also consider and act upon requests for loan write-down or forgiveness. Training& N/A Finance Committee or CRA Board may elect to Technical require a Borrower,as a condition of loan Assistance approval,to attend one or more technical assistance business classes or programs,or to access any business resource center or similar program. Program Owner(s) or developer(s)who have obtained Applicants who have obtained approval for a tax Restrictions a tax increment reimbursement for the same increment reimbursement for the same project under project under the Tax Increment the CRA's Tax Increment Reimbursement Program Reimbursement Program may not use the may not utilize the CDLP. Loan Program. Exceptions The Board of Directors,by a majority vote of The CRA Board of Directors,by a majority vote of hose present,may waive or make exceptions those present,may waive or make exceptions to the o the foregoing requirements with a finding foregoing requirements with a finding that the intent Existing Program Proposed Program that the goals of this program will be furthered of the CDLP will be furthered by such waiver or y such waiver or exception. exception. Complementing Financial Tools Across Departments The CRA has been coordinating with the Departments of Economic Development and Community and Neighborhoods to ensure that the City's commercial funding programs are complementary, equitable, and will effectively address the challenges that our local business,non-profit, and creative communities are facing. Below is a description of other departments' commercial programs, and the ways in which they differ from the proposed CDLP: • The Salt Lake City Economic Development Loan Fund's(EDLF)purpose is to stimulate business development and expansion, create employment opportunities, encourage private investment,and promote economic development by making loans available to businesses. Loans are available to businesses anywhere in Salt Lake City. Loans have a maximum amount of$350,000,with limits determined by the age and stability of the business. Eligible costs include tenant improvements, working capital, signage, and inventory. • Salt Lake City's Neighborhood Business Improvement Program(aka Fagade Grant Program)is designed to increase the street appeal of properties by offering grants to business owners and property owners in Salt Lake City's NBIP's Target Area. Grants for up to $50,000 are made available for exterior improvements and signage visible from the street. Budget Appropriations The CRA Board began appropriating funds for commercial assistance programs in FY2019 as the CRA was working toward developing a suite of tools that includes adaptive reuse loans, commercial revolving loans,community and cultural grants,and master leasing. Since then, some of these funds have been used for specific projects such as property acquisitions and dispositions,predevelopment tasks,and loans. The table below summarizes commercial appropriations made since 2019 and provides the remaining budget for each. ' i Appropriation Project Remaining Year Budgets Budgets Budget Adaptive Reuse Loans $ 882,175.79 Granary District FY23b $882,175.79 - $882,175.79 Commercial Revolving Loans $4,412,258.88 Central Business District FY23 $568,354.00 - $568,354.00 North Temple FY23 $150,741.00 - $150,741.00 State Street FY23 $500,000.00 $500,000.00' - FY24 $1,239,049.00 $1,100,000.00' $139,049.00 Revolving Loan Fund FY23 $11,994,964.88 $9,000,000.002 $2,994,964.88 FY24 $226,750.00 - $226,750.00 FY25 $332,400.00 - $332,400.00 Commercial Assistance Reserves` $3,984,450.00 9Line FY24 $500,000.00 - $500,000.00 Depot District FY24 $500,000.00 - $500,000.00 ' Appropriationi Remaining Year Budgets Budgets Budget FY25 $500,000.00 - $500,000.00 Granary District FY24 $1,003,435.00 - $1,003,435.00 FY25 $1,263,697.00 - $1,263,697.00 North Temple FY24 $217,318.00 - $217,318.00 Commercial Property Disposition - Depot District FY23 $5,498,927.00 $5,498,927.003 - Program Income Fund FY23 $1,601,073.00 $1,601,073.003 - Commercial Relocation - Block 70 FY24 $100,000.00 $100,000.004 - Commercial Studies and Planning - orth Temple FY25 $300,000.00 $300,000.00' - $27 378,884.70 II III II ' I 'Funds appropriated for a specific project area must be used in that project area; Revolving Loan Fund and Program Income Fund appropriations can be spent in any CRA project area b Funds appropriated in FY23 and earlier are designated as FY23 "Commercial Assistance Reserves"is a holding account that was created in FY24 to ensure resources are available for commercial programs currently being revised/developed by the CRA. 'Liberty Corner Daycare Loan Z Asher Adams Hotel Loan: $7,000,000; The Front Climbing Club Loan: $2,000,000 3 USA Climbing Property Disposition 4150 S Main St Retail Space Tenant Relocations s Schovaers Electronics(Folsom Corridor)Predevelopment Activities NEXT STEPS: • After receiving and incorporating Board feedback on the proposed CDLP Policy, CRA staff will return to the Board with a final policy to be adopted by resolution. • Once the Board adopts resolutions to establish the remaining proposed commercial assistance programs, Staff will return with a budget amendment request to appropriate the existing $9,278,884.70 to the proper Workday programs. • Beginning with FY26 budget planning,the CRA's commercial assistance funding requests will be appropriated to the Workday programs established following the Board's adoption of the commercial assistance program resolutions. PREVIOUS BOARD ACTION:N/A ATTACHMENTS: A. Proposed CRA Commercial Development Loan Program Policy B. CRA Guiding Framework C. CRA Livability Benchmarks Attachment A SALT LAKE CITY COMMUNITY REINVESTMENT AGENCY RESOLUTION NO. Commercial Development Loan Program Policy RESOLUTION OF THE BOARD OF DIRECTORS OF THE SALT LAKE CITY COMMUNITY REINVESTMENT AGENCY REPEALING THE LOAN PROGRAM POLICY AND THE GRANARY DISTRICT ADAPTIVE REUSE PROGRAM POLICY AND REPLACING IT WITH THIS COMMERCIAL DEVELOPMENT LOAN PROGRAM POLICY WHEREAS,the Salt Lake City Community Reinvestment Agency(CRA)was created to transact the business and exercise the powers provided for in the Utah Community Reinvestment Agency Act, Utah Code Title 17C; and WHEREAS, the Utah Community Reinvestment Agency Act grants the CRA powers to use funds to provide for project area development within project area boundaries; and WHEREAS,pursuant to Resolution 37-2016,the CRA Board of Directors (CRA Board) adopted the Loan Program Policy; and WHEREAS,pursuant to Resolution 8-2017,the CRA Board adopted the Granary Adaptative Reuse Program Policy; and WHEREAS, the CRA Board now supports the goal to consolidate and streamline the CRA's policies that serve commercial businesses by repealing and replacing the Loan Program Policy and the Granary Adaptive Reuse Program Policy with this Commercial Development Loan Program Policy. NOW, THEREFORE,BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE SALT LAKE CITY COMMUNITY REINVESTMENT AGENCY, that the Loan Program Policy adopted pursuant to Resolution 37-2016 and Granary District Adaptive Reuse Program Policy adopted pursuant to Resolution 8-2017 are repealed in their entirety and replaced with the following policy for a Commercial Development Loan Program: 1. PURPOSE The Commercial Development Loan Program(CDLP)provides critical financing to support and incentivize the development of commercial and mixed-use projects that advance the CRA's Guiding Framework for Mission and Values. 2. INTENT Funds distributed through the CDLP are intended to: a. Incentivize the creation of new commercial spaces and formation of unique business districts throughout CRA project areas. b. Encourage the provision of attainable rental or ownership opportunities for local and independent businesses and community-serving non-profits. c. Provide opportunities to establish new services, amenities, or underrepresented business types within a neighborhood, especially childcare facilities and after-school programs. d. Invest in mixed-use projects with residential components that advance adopted priorities of the CRA Housing Development Funding Strategy. e. Support the preservation, rehabilitation, or adaptive reuse of existing building stock. £ Incorporate green-building elements to lower operating expenses, conserve resources, and promote resiliency. g. Maximize CRA impact by leveraging other,private funding sources as part of a project's capital stack. h. Promote neighborhoods with a balanced economy that produces quality jobs through employment opportunities and workforce development programs. i. Enhance the capacity for non-traditional applicants to apply for and utilize CRA funds. 3. PROGRAM ADMINISTRATION Administration of the CDLP shall be guided by this policy and corresponding administrative guidelines. Funding shall be offered on an ongoing basis, subject to the availability of funds and the level of demand. 4. THRESHOLD REQUIREMENTS To be eligible for funding through the CDLP,projects must, at minimum, meet the following threshold requirements, in addition to further requirements that may be set forth in the CDLP administrative guidelines. a. Eligible Project Types The CDLP provides funding to facilitate various commercial and mixed-use development projects, including new construction,building rehabilitation, significant site work, and other improvements that will remain with and benefit the property long-term. Mixed-use projects must include activated ground floor space. Activated ground floor space means that a minimum of 50% of all ground floor, street-facing building facades must contain an active (commercial, retail, office, etc.), non-residential use that is open to the public and not exclusive to the tenants of the building. b. Eligible Costs Funding is made available for construction costs, or hard costs. Use of funds for property acquisition, infrastructure improvements, environmental remediation, demolition, or project- related soft costs will be considered on a case-by-case basis, if part of a larger redevelopment project. Refinancing of existing debt is ineligible. c. Eligible Applicants Applicants must be the title owner or long-term ground lessee of the property. Current or prospective commercial tenants who lease all or a portion of the property may also apply. Applicants must provide sufficient evidence of their capabilities to successfully complete the project, and their credit history must demonstrate prompt payment of past obligations. Applicants and affiliated entities must be in good standing on all existing contracts administered by the CRA, Salt Lake City Corporation, Salt Lake County, and the State of Utah. i. Property Owners/Ground Lessees Evidence of site control must be demonstrated through proof of ownership, option to purchase agreement,purchase and sale agreement, long-term ground lease agreement, or equivalent. Property taxes and special assessments must be current,with no outstanding judgments or liens against the applicant(s). ii. Tenants Evidence of a lease agreement that will remain in place for, at minimum, the duration of the loan term shall be provided. Proposed project activities must be approved by the property owner. d. Project Area Objectives The project must be located within an eligible CRA Project Area and must support at least one Project Area Objective as provided in the most recent Project Area Work Plan. e. Qualifying Livability Benchmarks The CRA's Livability Benchmarks (Benchmarks) are derived from the CRA's core mission and three (3)overarching values: Economic Opportunity, Equity and Inclusion, and Neighborhood Vibrancy. Projects that receive funding shall implement the Benchmarks by meeting the threshold requirements listed below(Qualifying Benchmarks). Qualifying Benchmarks are required for all projects receiving CDLP loans, and do not provide interest rate reductions as discussed in section 5.c.ii, Incentivized Livability Benchmarks. i. To support projects that have a reasonable timeframe for completion and ensure ongoing funds availability,projects must be prepared to break ground within 12-15 months of receiving conditional funding approval. ii. Projects must also meet a minimum of two (2) of the following Qualifying Benchmarks: Leveraging, Permanent Job Creation, Commercial Vitality, or Ownership. iii. Mixed-use developments that contain a residential use may supplant one of the Qualifying Benchmarks listed in 4.e.ii with one of the adopted priorities of the CRA Housing Development Funding Strategy for the current fiscal year. f. Design Requirements Projects shall comply with all applicable Salt Lake City and CRA policies, ordinances, and codes. g. Sustainable Development Projects shall comply with the CRA's Sustainable Development Policy. h. Tenant Displacement Displacement of current residential and commercial tenants is strongly discouraged but may be unavoidable. For residential displacement, the applicant shall submit a relocation plan that complies with applicable federal, state, and local policies for temporary or permanent displacement. For commercial displacement, the applicant shall disclose the number of commercial units lost, their respective sizes (in square feet), the names of impacted businesses, efforts made to accommodate them elsewhere, and other relevant information as requested in the application for funding. 5. LOAN AMOUNT,TERM, &INTEREST RATE a. Loan Amount The CDLP is intended to provide gap financing to supplement existing, secured funding. The applicant must provide sufficient evidence that the amount of funds requested from the CRA is necessary for the project to succeed. The applicant must demonstrate that borrowing capacity is inadequate, future revenues are inadequate or cannot accommodate the timeliness necessary to complete the project, or costs would place an undue financial burden on the applicant. A loan commitment should be secured(evidenced by a letter of interest and term sheet) from a private lending source at the best possible rate and terms and in the maximum size available,based on the economics of the project. The CRA may consider acting as primary lender if the applicant demonstrates that traditional financing is either unavailable or severely cost-prohibitive to the project. i. Maximum Loan Amount All projects shall have a maximum loan amount of$2,000,000. ii. Gap Financing Loan maximums are limited to the demonstrated gap in available financing to cover project costs and shall be sized to support a debt service coverage ratio (DSCR) of 1.1 or a loan to value (LTV) of 95%, inclusive of all debt on the project,whichever results in the lower loan amount. iii. Primary Financing When the RDA's contribution is greater than 60%of the project's total development costs, loans shall be sized to support a debt service coverage ratio (DSCR) of 1.2 or a loan to value (LTV) of 90%, inclusive of all debt on the project, whichever results in the lower loan amount. b. Term &Amortization Loan terms and amortization schedule shall be determined as follows: i. Term The loan term shall be up to five(5)years. An option to extend the overall loan term to 10 years may be available through a preauthorized extension that provides an interest rate increase of 2%beginning in year six(6). ii. Amortization The standard amortization period is up to 20 years with balloon payment due at loan maturity. c. Interest Rate Interest rates shall be determined as follows: i. Standard Interest Rate Interest rates are fixed at 300 basis points(3%)plus the U.S. Treasury Yield Curve Rate, to be locked in within a month of loan closing. For example, if the U.S. Treasury Yield Curve Rate is 4.5%when the rate is locked in, the CDLP standard interest rate is 7.5%. Interest shall accrue beginning with the first draw of funds. In the event of a default,the interest rate will increase to 14% on the unpaid sum. ii. Incentivized Livability Benchmarks A reduction to the standard interest rate is available for projects that meet additional Livability Benchmarks beyond the threshold requirements listed in section 4.e, Qualifying Livability Benchmarks, as provided in the administrative guidelines,with the ability to reduce the interest rate to a minimum of 3%. 6. BUILDING PRESERVATION,REHABILITATION, OR ADAPTIVE REUSE Projects that involve the preservation,rehabilitation, or repurposing of a vacant,underutilized, or economically challenged building for a land use that contributes positively to the surrounding neighborhood may be eligible for forgiveness of up to $200,000 of the loan principal amount. Qualifying projects are required to operate as the intended use over a five (5)-year term,with the term commencing at loan closing. If this condition is met, the amount approved to be forgiven shall be forgiven in one lump sum at the end of the five (5)-year term. 7. COLLATERAL AND GUARANTEES Adequate security shall be required, generally in the form of a deed of trust,personal guarantees, and/or other acceptable forms of collateral as established by the administrative CDLP guidelines. 8. EVALUATION& APPROVAL PROCESS a. Application Process The process for distributing and collecting loan applications and supporting documentation shall be established by the CDLP administrative guidelines. b. Underwriting by CRA Staff CRA staff shall carry out an underwriting process according to the CDLP administrative guidelines. If either the applicant or proposed project fails to demonstrate the ability to meet underwriting requirements, CRA staff shall reserve the right to deny the loan application. c. CRA Finance Committee Review Once underwriting standards have been met, applications shall be forwarded to the CRA Finance Committee. The CRA Finance Committee shall evaluate applications, supplemental materials, and underwriting reports to determine if the application shall be selected/recommended for conditional loan approval. d. Conditional Approval Process The CRA Finance Committee provides conditional loan approval for standard loans totaling $500,000 or less. Loans that exceed$500,000 or that involve an adjustment from standard loan terms must be provided conditional loan approval by the CRA Board. The CRA Finance Committee shall consider and, upon submitting a recommendation to the Board, the Board shall consider and have the authority to provide conditional loan approval. e. Loan Finalization Once an applicant receives conditional loan approval, CRA staff shall finalize the loan according to the CDLP administrative guidelines. f. Fees Applicable application and legal fees, as well as closing costs, as outlined in the CDLP administrative guidelines, shall be borne by the Borrower. 9. LOAN DISBURSEMENT & REPAYMENT a. Disbursement of Funds Funding shall be disbursed as construction draws evidenced by supporting documentation demonstrating that the work has been completed and that the project is in good financial and legal standing. Applicant equity must be utilized prior to CRA funds being drawn. On a case- by-case basis, funds may be disbursed at loan closing. b. Repayment The first payment shall be due at the beginning of the fourth(4th)month after the project receives a Certificate of Occupancy. Loans may be prepaid in whole or in part at any time without penalty. 10. MONITORING& COMPLIANCE Reporting requirements, as outlined in the administrative guidelines,will be put in place to ensure that projects are in compliance with obligations associated with CDLP threshold requirements and incentives. Some commitments may be memorialized in loan agreements, restrictive use agreements, or other form of agreement that is executed at closing. 11. LOAN MODIFICATIONS In the event of extenuating circumstances,the CRA may provide payment forbearance,payment deferment, an adjustment to terms, or loan write-down. Such adjustments shall be considered on a case-by-case basis and shall be subject to a thorough review of the project's financial standing and other relevant information. The process for providing loan modifications shall be considered and authorized as follows: a. Forbearance/Deferment The Director of the CRA may elect to provide the Borrower with a temporary forbearance or deferment of payment for up to one (1)year. For periods of forbearance or deferment longer than one (1)year, the CRA Finance Committee shall provide a recommendation that is forwarded to the Board,who shall consider and act upon all such requests. b. Adjustment to Terms The Director of the CRA may elect to authorize an extension of the repayment term by an additional five (5)years (beyond the term that was initially approved), and/or re-amortization up to 30 years. c. Loan Write-down The CRA Finance Committee shall provide a recommendation that is forwarded to the Board, who shall consider and act upon all such requests. 12. TRAINING& TECHNICAL ASSISTANCE The Finance Committee or CRA Board may elect to require a Borrower, as a condition of loan approval,to attend one or more technical assistance business classes or programs, or to access any business resource center or similar program. 13. PROGRAM RESTRICTION Applicants who have obtained approval for a tax increment reimbursement for the same project under the CRA's Tax Increment Reimbursement Program may not utilize the CDLP. 14. EXCEPTIONS The CRA Board of Directors,by a majority vote of those present, may waive or make exceptions to the foregoing requirements with a finding that the intent of the CDLP will be furthered by such waiver or exception. 15. REPORTING ON LOAN PORTFOLIO The CRA shall provide a written briefing to the Board, no less than semi-annually per fiscal year, which contains an update on the commercial development loan portfolio. Such briefing shall include a summary of new loans, outstanding principal balance, available loan funds, and delinquencies. Attachment B Guiding Framework 4 . RDA This Guiding Framework is a strategic operational document outlining the methodology for evaluating and prioritizing projects requesting RDA financial assistance. The RDA's Mission and Values form the foundation of the Guiding Framework, declaring the RDA's purpose and the intended economic, social, and physical outcomes expected of RDA projects and partnerships. MISSION: The Redevelopment Agency of Salt Lake City strengthens neighborhoods and business districts to improve livability, create economic opportunity and foster authentic, equitable communities, serving as a catalyst for strategic development projects that enhance the City's housing opportunities, commercial vitality, public spaces, and environmental sustainability. VALUES: Economic Opportunity- Equity&Inclusion- Neighborhood Vibrancy- We invest in the long-term prosperity and growth We prioritize people-focused projects and We cultivate distinct and livable places that are of our local economy. programs that encourage everyone to contextually sensitive, durable, connected, and participate in and benefit from development sustainable. decisions that shape their communities. PROJECT EVALUATION PROCESS: The RDA prioritizes projects that demonstrate a commitment to the Mission and Values, evaluating projects via three steps,which answer the following questions: 1.) Does the project meet the minimum THRESHOLDS required for RDA participation?2.)To what degree does the project benefit the public by achieving defined LIVABILITY BENCHMARKS, thereby warranting RDA assistance? 3.) Does the project meet the CRITERIA outlined in existing RDA programs and policies,such as the RDA Loan Program or Tax Increment Reimbursement Program? Alignment with adopted City policies&plans Step 1:THRESHOLDS Alignment with RDA Project Area Work Plans* • Financial viability with a demonstrated and reasonable need for public assistance Economic Opportunity Equity&Inclusion Neighborhood Vibrancy Leveraging Transit Opportunities Public Space Step 2: Timeliness Mixed-Income Neighborhoods Public Art LIVABILITY Return of Investment Neighborhood Safety Architecture &Urban Design BENCHMARKS Permanent Job Creation &Retention Community Engagement&Support Sustainability Affordable Commercial Spaces Housing for Everyone Walkability Ownership Displacement Mitigation Building Preservation, rehabilitation, or Affordable Housing Preservation adaptive reuse Missing Middle&Unique Building Types Step 3: PROGRAM Evaluation of project according to respective RDA policies, programs and procedures CRITERIA `Spanning a 1-3 year time frame,Project Area Work Plans identify redevelopment objectives and strategic redevelopment projects for each project area,along with a corresponding schedule&budget for each project. The Project Area Work Plans will be based on relevant City policies and plans and the Project Area Plans that were adopted when the project area was created and will provide direction for the annual RDA budget process. Adopted 12.14.21 Attachment C LIVABILITY BENCHMARKS RDA Public Benefit Description&Intent Leveraging To promote the leveraging of non-RDA/City sources of funding to maximize private investment. Timeliness To support projects that have a reasonable timeframe for completion. Return of Investment To promote the return of RDA resources,thereby enabling resources to extend further in the community. Permanent To promote neighborhoods with a balanced economy that produces quality jobs. Job Creation Affordable Commercial To reduce the displacement risk of existing community businesses and/or reduce barriers to entry for new, Spaces underrepresented business and service types, particularly locally-owned and independent businesses and non-profits that promote neighborhood identity,economic vitality,and local economic multipliers. Ownership To encourage the creation of opportunities for residents/business owners to build wealth and/or establish permanent roots through affordable home/commercial ownership. Transportation To promote a multimodal transportation network and ensure convenient and equitable access to a variety of Opportunities transportation options. Mixed-Income To promote mixed-income developments,economically integrated communities,and housing opportunities Neighborhoods for low-income residents. Neighborhood Safety To reduce the number of vacant and distressed buildings and lots to reduce crime and return land to a productive use. Community To provide a stronger platform for community members to inform and influence development projects during Engagement&Support initial planning stages and to preserve cultural heritage. Housing for Everyone To promote housing for families and underserved populations r` Displacement Mitigation To mitigate the displacement of current residents and residents with generational ties to the neighborhood, or provide opportunities for those who have already been displaced to return. Affordable Housing To preserve existing affordable housing. Preservation Public Space To promote community amenities that provide opportunity for social interaction;support cultural events; promote neighborhood identity;and reinforce neighborhood character. Public Art To promote cultural expression and add to the experience and value of the built environment through art that is publically visible or accessible for all to experience. •• Architecture&Urban To promote high quality architecture that enhances the public realm,strengthens the neighborhood's unique Design • character,and uses enduring materials. • Sustainability To promote a built environment that assists with protecting resources and promoting greater resiliency. Walkability To promote walkable neighborhoods and connectivity,and support a safe,engaging pedestrian experience. Building Preservation, To acknowledge a neighborhood's history and maintain its unique character through preservation, Rehabilitation,or rehabilitation,or repurposing of historic or underutilized structures. Adaptive Reuse Missing Middle& To promote an array of scale of project types to provide neighborhood-scale commercial,diversify the City's Unique Building Types housing stock/forms,and provide more affordable living options for residents.