HomeMy WebLinkAboutProposed Resolution - 5/23/2025SALT 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
SALT LAKE CITY COMMUNITY REINVESTMENT AGENCY
RESOLUTION NO. _______________
Adopting Term Sheet for the Palmer Court Affordable Housing Amended Loan
Agreement for Construction of the Gardens at Palmer to Facilitate the Preservation and
Redevelopment of Deeply Affordable Housing
RESOLUTION OF THE BOARD OF DIRECTORS OF THE SALT LAKE CITY
COMMUNITY REINVESTMENT AGENCY APPROVING THE TERM SHEET FOR THE
PALMER COURT AFFORDABLE HOUSING LOAN AMENDMENT
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, including the development of affordable housing.
WHEREAS, Shelter the Homeless II, L.C. (Shelter the Homeless) is a nonprofit
organization dedicated to serving individuals experiencing homelessness and working with
partners to develop safe facilities and expand solutions to prevent and end homelessness in Utah.
WHEREAS, on April 17, 2007, the CRA’s Board of Directors (then known as the
Redevelopment Agency of Salt Lake City (RDA) Board of Directors) (Board) approved resolution
No. 627.02, setting aside $3 million RDA funds to be distributed by the RDA to Shelter the
Homeless as a forgivable loan with conditions requiring 60 Single-Room Occupancy (SRO) units
to be made available as weekly rentals.
WHEREAS, Shelter the Homeless is redeveloping its Palmer Court facility located at 999
South Main Street, in which 201 units of affordable housing, including 60 units with CRA-
restrictions, will be replaced with a development called Gardens at Palmer on a parcel east of the
existing site that will include 187 new units of affordable housing.
WHEREAS, the transfer of existing units to a new building will permit the demolition of
the existing, inadequate structure and allow for the development of additional affordable housing
and community benefits.
WHEREAS, the transfer of 60 weekly rental SRO units would constrain redevelopment,
as it may conflict with certain requirements for key funding sources, including Low-Income
Housing Tax Credits (LIHTC) and Project-Based Vouchers (PBV), and hamper operational
viability.
WHEREAS, CRA staff recommends that the Board approve the attached Term Sheet to
assign the loan to the new project entity for Gardens at Palmer, modify certain loan provisions,
including removing the requirement for SRO units to be offered as weekly rentals, and associated
ATTACHMENT C – RESOLUTION
9
references and requirements, while maintaining key loan terms such as the maturity date, annual
loan forgiveness, and affordability levels.
NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of the Salt Lake
City Community Reinvestment Agency that it approves the Palmer Court Affordable Housing
Loan Amendment as outlined in the Term Sheet attached hereto, subject to revisions that do not
materially affect the rights and obligations of the CRA hereunder. The Board authorizes the
Director to negotiate and execute the legal agreements and any other relevant documents
consistent with the Term Sheet and incorporating such other terms and agreements as
recommended by the City Attorney’s office.
Passed by the Board of Directors of the Redevelopment Agency of Salt Lake City, this
____ day of June 10, 2025.
_________________________________
Darin Mano, Chair
Approved as to form:
Salt Lake City Attorney’s Office
Sara Montoya
Date:_______________________
The Executive Director:
____ does not request reconsideration
____ requests reconsideration at the next regular Agency meeting.
________________________________
Erin Mendenhall, Executive Director
Attest:
________________________
City Recorder
May 22, 2025
10
EXHIBIT A – TERM SHEET
Term Sheet for the Palmer Court Affordable Housing Loan Amendment Among the Salt
Lake City Community Reinvestment Agency, Shelter the Homeless II, L.C. and the New
Project Entity Developing Gardens at Palmer to Facilitate the Preservation and
Redevelopment of Deeply Affordable Housing
Purpose
To assign and modify the terms of a 2008 loan agreement for $3,000,000 by and between the
CRA and Shelter the Homeless II, LC, which is operated by The Road Home (“Borrower”),
enabling the redevelopment of Palmer Court (“Current Project”), which is located at 999 S Main
Street. The redevelopment will encompass the construction of a new residential development
called Gardens at Palmer, to be located east of the Current Project (“Gardens”), to enable the
preservation and expansion of deeply affordable and permanent supportive housing.
Parties
•Shelter the Homeless II, L.C.
•The new entity developing Gardens at Palmer, which are/will be operated by The Road
Home (“Assignee Borrower”) (currently unidentified)
•Salt Lake City Community Reinvestment Agency (“CRA”).
Properties
Parcels 16-07-301-013-0000 (Current Project) and 16-07-301-017-0000
(Gardens).
Eligible Use of Funds
For the construction and redevelopment of the Gardens.
Terms Category Existing Agreement Proposed Modifications
Loan Terms
$3M CRA loan; $300K forgiven
annually (2023–2033); fully forgiven by
April 1, 2033 so long as Borrower is not
in material default (beyond any
applicable notice, grace, or cure
periods).
Same loan terms preserved;
maturity date and forgiveness
schedule unchanged.
11
Category Existing Agreement Proposed Modifications
SRO Requirements
60 units must be available to be rented
weekly as required under the CRA loan
and tied to mitigation for previous SRO
demolitions.
Remove weekly rental
requirement; lease term modified
to a minimum of 1 year.
Affordability
Existing Loan Agreement establishes
rental limits for SRO units. Existing
units are currently rented at rates below
the 30% AMI rent limit.
Proposed agreement would
preserve affordability, ensuring
that 60 units will continue to be
rented at deeply affordable rates
(at or below 30% AMI). All 187
units in Gardens will be
affordable to households at or
below 30% of AMI.
Protections for
Current Residents
Existing Loan Agreement gave initial
priority to former State Street SRO
Hotel residents when new units at
Palmer Court became available.
Proposed agreement would give
preference to existing Palmer
Court SRO residents when new
units at Gardens become
available.
Deed Restrictions The requirements for the 60 SRO units
are laid out within the loan agreement.
The affordability requirements
for Gardens can be addressed
through a Deed Restriction.
Compliance and Legal Requirements
Assignee Borrower will be required to take the following actions to meet the CRA’s compliance
and legal requirements:
• Comply with all local, state, and federal regulations, including zoning, environmental,
and fair housing laws.
• Execute loan documents (e.g. promissory notes, loan agreements, security documents,
restrictive use agreements) as requested by the CRA and its legal counsel.
• Receive approval from the CRA and its legal counsel of all matters pertaining to title,
legality of the loan, and the legality, sufficiency, and the form and substance of all
documents that are requested by CRA for the loan transaction.
• Provide evidence of insurance in such amounts and with such coverage as requested by
the CRA for the property.
• Use funds solely for the purposes outlined in this term sheet.
• Such other terms as requested by the CRA’s legal counsel and staff.
Conditions for Amending Loan Terms
12
The funding is provided with the following pre-conditions that the Borrower and/or Assignee
Borrower must meet to receive funding:
• Provide to the CRA any additional sources of program financing, including letters of
commitment for additional funding.
• Receive low-income housing tax credits.
• Obtain all financial, legal, and regulatory approvals required for the construction,
completion, and operations of Gardens.
• Provide the CRA with updates to Gardens’ sources and uses and operating proforma.
Other
In the event Gardens is unable to be completed, the current Loan Agreement will remain in
place, and existing legal obligations will remain on the Current Project through the term.
13