PREPARED BY: ELIZABETH LOPEZ DATE OF MEETING: 03/02/2026
SUBJECT:
TITLE
CONDUCT A PUBLIC HEARING UNDER THE TAX AND EQUITY FISCAL RESPONSIBILITY ACT (“TEFRA”) ON MARCH 2, 2026 IN CONNECTION WITH THE PROPOSED ISSUANCE OF REVENUE BONDS BY THE CALIFORNIA MUNICIPAL FINANCE AUTHORITY (THE “CMFA”), A JOINT EXERCISE OF POWERS AUTHORITY AND PUBLIC ENTITY OF THE STATE OF CALIFORNIA, IN AN AMOUNT NOT TO EXCEED $15,000,000, (THE “BONDS”), TO: (1) FINANCE OR REFINANCE THE ACQUISITION, CONSTRUCTION, IMPROVEMENT AND EQUIPPING OF ALVARADO GARDENS PHASE II, A MULTIFAMILY RENTAL HOUSING PROJECT (THE “PROJECT”) LOCATED AT 13831 SAN PABLO AVENUE, SAN PABLO, CALIFORNIA (THE “CITY”); AND (2) PAY CERTAIN EXPENSES INCURRED IN CONNECTION WITH THE ISSUANCE OF THE BONDS
CEQA: This proposed action is not a project as defined by CEQA
Label
CITY MANAGER RECOMMENDATION
Recommendation
Conduct public hearing; adopt Resolution
Body
RECOMMENDATIONS
Conduct the public hearing under the requirements of the Tax and Equity Fiscal Responsibility Act (“TEFRA”) and the Internal Revenue Code of 1986, as amended (the “Code”).
Adopt the resolution approving the issuance of the Bonds by the CMFA for the benefit of San Pablo Church Lane II LP (the “Borrower”), to provide for the financing of the Project, such adoption is solely for the purposes of satisfying the requirements of TEFRA, the Code and the California Government Code Section 6500 (and following).
BACKGROUND
San Pablo Church Lane II LP (the “Borrower”) requested that the CMFA serve as the municipal issuer of the Bonds in an aggregate principal amount not to exceed $15,000,000 (the “Bonds”) of tax-exempt revenue bonds. The proceeds of the Bonds will be used to: (1) finance or refinance the acquisition, construction, improvement and equipping of Alvarado Gardens Phase II, a multifamily rental housing project (the “Project”) located at 13831 San Pablo Avenue, San Pablo, California (the “City”); and (2) pay certain expenses incurred in connection with the issuance of the Bonds.
For the Bonds to qualify as tax-exempt bonds, the City of San Pablo must conduct a public hearing (the “TEFRA Hearing”) providing for the members of the community an opportunity to speak in favor of or against the use of tax-exempt bonds for the financing of the Project. Prior to such TEFRA Hearing, reasonable notice must be provided to the members of the community. Following the close of the TEFRA Hearing, an “applicable elected representative” of the governmental unit hosting the Project must provide its approval of the issuance of the Bonds for the financing of the Project.
California Municipal Finance Authority:
The CMFA was created on January 1, 2004, pursuant to a joint exercise of powers agreement to promote economic, cultural and community development, through the financing of economic development and charitable activities throughout California. To date, over 350 municipalities have become members of CMFA.
The CMFA was formed to assist local governments, non-profit organizations and businesses with the issuance of taxable and tax-exempt bonds aimed at improving the standard of living in California. The CMFA’s representatives and its Board of Directors have considerable experience in bond financings.
Prior City Council Action:
On March 18, 2024, the City Council adopted Resolution 2024-040, approving and authorizing the execution of a First Amendment to Amended and Restated Disposition and Development Agreement with Danco Communities for the sale and development of a portion of the former San Pablo City Hall. The amendment increased the City’s loan funding for the Phase 2 Project to a total of $5,932,262, all of which will be paid through residual receipts from the Phase 2 Project over a period of 55 years.
FISCAL IMPACT
The Bonds to be issued by the CMFA for the Project will be the sole responsibility of the Borrower, and the City will have no financial, legal, moral obligation, liability or responsibility for the Project or the repayment of the Bonds for the financing of the Project. All financing documents with respect to the issuance of the Bonds will contain clear disclaimers that the Bonds are not obligations of the City or the State of California but are to be paid for solely from funds provided by the Borrower.
The Board of Directors of the California Foundation for Stronger Communities, a California non-profit public benefit corporation (the “Foundation”), acts as the Board of Directors for the CMFA. Through its conduit issuance activities, the CMFA shares a portion of the issuance fees it receives with its member communities and donates a portion of these issuance fees to the Foundation for the support of local charities. With respect to the City of San Pablo, it is expected that that a portion of the issuance fee attributable to the City will be granted by the CMFA to the general fund of the City. Such grant may be used for any lawful purpose of the City.
ATTACHMENTS
Att A - Resolution
Att B - Proof of Publication