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DocuSign Envelope ID:CC260930-C131-4F24-877B-33EC6B7D9D88 <br /> RESOLUTION NO. 3079 <br /> A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ANACORTES TO <br /> FORGIVE THE BALANCE OF THE COMMUNITY DEVELOPMENT BLOCK GRANT <br /> (CDBG) AGREEMENT BETWEEN THE CITY AND THE ANACORTES HOUSING <br /> AUTHORITY (AHA) <br /> WHEREAS, in 2004 the City of Anacortes began the process of working with the Anacortes <br /> Housing Authority (AHA) to redevelop the New Wilson Hotel building into a mixed use of low- <br /> income housing units and retail space; and <br /> WHEREAS, the loan repayment amount annually is based on net cash flow from the low- <br /> income housing project as laid out in the promissory note, which fluctuates from year to year and <br /> is difficult to forecast; and <br /> WHEREAS, any payment over$25,000 to the City triggers additional reporting and accounting <br /> requirements, which are administratively burdensome under the CDBG regulations; and <br /> WHEREAS, on six occasions, the AHA has had to make payments to the City and only twice <br /> were those payments over $25,000; and <br /> WHEREAS, the repayment of the loan is creating a fiscal hardship for the AHA who is in the <br /> midst of developing additional low-income housing opportunities for the less fortunate citizens <br /> of Anacortes, which include two projects reliant on Affordable Housing Sales Tax that is <br /> collected by the City and passed through to the AHA; and <br /> WHEREAS, the granting agency is U.S. Department of Housing and Urban Development <br /> (HUD) and their grant representative has confirmed with the City that the City has the authority <br /> to cancel the existing loan agreement, and relieve the AHA of the burden of repaying the <br /> remaining balance of the loan; and <br /> WHEREAS, the City of Anacortes is desirous of supporting affordable housing, and would like <br /> to forgive the balance of the existing New Wilson Hotel loan to allow more AHA funds to be <br /> used on other projects that will directly increase the amount of affordable housing available in <br /> the City of Anacortes. <br /> NOW THEREFORE, BE IT RESOLVED, by the City Council of the City of Anacortes, <br /> Washington, that that the balance of the loan between the AHA and the City of Anacortes as of <br /> March 31, 2022, in the amount of$160,912.51 is now hereby forgiven, and authorizes the <br /> Finance Director to make the necessary accounting entries to eliminate that balance from the <br /> City accounting records. <br /> Resolution 3079 1 <br />