Item 3C: Resolution Concerning Loan Guarantee Assistance

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Policy 17: Protect and improve air and water quality and protect natural areas of good habitat value through a variety of means such as better enforcement of existing regulations, new or revised regulations, or other practices. The City’s debt policies govern the issuance of any kind of borrowing. The conduit financing portion of the policy is included as Attachment B. If the City decides to use a Section 108 Loan Guarantee to borrow money to lend to a private developer, the council will need to waive several of the conduit financing policies. For instance, the City’s debt policies state that the City will not incur any moral or financial obligation under a conduit borrowing. A HUD Section 108 Loan Guarantee is set up for the purpose of using the City’s CDBG funds as the ultimate security on a loan; therefore, the City would incur a possible financial obligation under this financing structure. When the council considers a specific financing resolution for a future project, waiver of any appropriate debt policies would be part of that approval process. The waiver is not necessary at this time. COUNCIL OPTIONS The council can choose to take action in support of the Section 108 Loan Guarantee application by approving the proposed resolution, or can decline to support the application as proposed. CITY MANAGER’S RECOMMENDATION The City Manager recommends that the council approve the proposed resolution in support of the Section 108 Loan Guarantee application. SUGGESTED MOTION Move to adopt Resolution No. 4860 authorizing submission of an application to United States Department of Housing and Urban Development for loan guarantee assistance and related matters. ATTACHMENTS A. Proposed Resolution B. Debt Policy Excerpt – Conduit Financings C. Brownfield Grant Award Letter FOR MORE INFORMATION Staff Contact: Denny Braud Telephone: 682-5536 Staff E-Mail: denny.braud@ci.eugene.or.us L:\CMO\2006 Council Agendas\M060313\S0603133C.doc