Agenda Item # 1

Columbus Consolidated Government
Council Meeting

June 12, 2018

Agenda Report # 131

TO: Mayor and Councilors

SUBJECT: Lease Amendment for Redevelopment of Claflin School

INITIATED BY: Community Reinvestment Department


Recommendation: Approval is requested to amend the current lease agreement with Friends of Historic Claflin, Inc. to extend the lease term, and incorporate additional requirements needed to satisfy the investors for the project.

Background: On May 9, 2017, per Resolution 124-17, City Council approved revising the lease agreement between the Columbus Consolidated Government and Friends of Historic Claflin to allow for Oracle Consulting Services, LLC (developer) to convert the school into 44 (+/-) units of affordable housing, with an area of the school to be set-aside for educational programs and to display the school’s history. The developer applied for Low-Income Housing Tax Credit (LIHTC) through the Georgia Department of Community Affairs (DCA) and was successfully awarded those credits. As part of this development a new joint venture was created called Claflin School Preservation, L.P., for the sole purpose of preserving and developing this property. This joint venture is a limited partnership between the investors, Oracle Consulting Services, LLC, and the Friends of Historic Claflin, Inc. The lease agreement was sub-leased to the joint venture per Resolution 412-17. Construction is expected to begin in July 2018.

FHC and Oracle Consulting Services are requesting amendments to the existing lease agreement in order to finalize the financing needed to start construction. Based on the request, staff is recommending that the lease agreement and any other agreements between the parties be revised as follows:
Analysis: The redevelopment of this property will assist with the elimination of blight, develop approximately 44 units of affordable housing, and create local jobs.

Financial Considerations: The City will not incur any expenses associated with the redevelopment of Claflin School. Friends of Historic Claflin and the Developer will be responsible for all costs associated with the construction and operations of this facility.

Legal Considerations: Council must approve all real estate transactions.

Recommendations: Authorize the City Manager to approve an amendment to the current lease agreement with Friends of Historic Claflin, Inc. to extend the lease term, and incorporate additional requirements needed to satisfy the investors for the project.


RESOLUTION
NO. ________

A RESOLUTION AUTHORIZING THE CITY MANAGER TO AMEND THE LEASE AGREEMENT WITH FRIENDS OF HISTORIC CLAFLIN, INC TO EXTEND THE LEASE TERM, AND INCORPORATE ADDITIONAL REQUIREMENTS NEEDED TO SATIFY THE INVESTORS FOR THE PROJECT.

WHEREAS, the City currently has a lease agreement with Friends of Historic Claflin, Inc. (FHC) for the redevelopment of Claflin School; and,

WHEREAS, Oracle Consulting, Services has partnered with FHC on this project, and together they have created a joint venture called Claflin School Preservation, L.P. which is in the process of converting the school into affordable housing; and,

WHEREAS, the lease will be amended to (1) extend the term of the lease agreement from 45 years to 65 years; (2) allow provisions to be added to the lease agreement to use the building as collateral to allow for financing to be obtained; (3) add language to the lease agreement that specifies that the property will revert back to the City at the end of the lease term; (4) combine relevant portions of all previous lease amendments, MOU, etc. into one document; and,

WHEREAS, the redevelopment of this property will assist with the elimination of blight, develop new units of affordable housing, and create new local jobs.

NOW, THEREFORE, THE COUNCIL OF COLUMBUS, GEORGIA, HEREBY RESOLVES AS FOLLOWS:

That subject to the terms and conditions set forth above, the City Manager is hereby authorized to sign an amendment to the Lease Agreement executed between Columbus Consolidated Government and Friends of Claflin, Inc.
_________

Introduced at a regular meeting of the Council of Columbus, Georgia, held the _________day of _____________, 2018 and adopted at said meeting by the affirmative vote of ___________ members of said Council.


Councilor Allen voting __________.
Councilor Baker voting __________.
Councilor Barnes voting __________.
Councilor Davis voting __________.
Councilor Garrett voting __________.
Councilor Huff voting __________.
Councilor Thomas voting __________.
Councilor Turner Pugh voting __________.
Councilor Woodson voting __________.



_______________________________ _________________________
Tiny B. Washington, Clerk of Council Teresa Pike Tomlinson, Mayor