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Calexico denies low-interest loan to housing board

March 13, 2002|By AARON CLAVERIE

Staff Writer

CALEXICO — The City Council here, seated as the city Redevelopment Agency board, denied a request from Alexis Gevorgian when it voted 3-2 to not give the Calexico Housing Authority a $400,000 low-interest loan.

Gevorgian is a Los Angeles-based housing consultant who asked the board a number of times to reconsider a decision from October 2000, when the board stripped the promise of a $400,000 loan to Gevorgian's clients, Beyond Shelter Housing Corp. and the Calexico Housing Authority. The board did so after hearing reports of a conflict between Gevorgian's clients and other local housing agencies that were applying for tax credits.

There were two projects being considered for tax credits from the California Tax Credit Allocation Committee.

Gevorgian had written a tax credit application for the Housing Authority and Beyond Shelter Housing Corp. that was sent to Sacramento in June 2000. The authority pledged to provide $1.2 million to the project. By pledging $1.2 million instead of a lower amount, the partners improved their chances of receiving millions in tax credits.


However, the authority didn't have $1.2 million at the time; it was counting on a $400,000 loan from the city to help cover the gap.

At a meeting months ago, authority interim Executive Director Christina Rojas said the authority had around $800,000.

Gevorgian told the board on Tuesday the authority was "relying" on the $400,000.

City Attorney Michael Rood said in June 2000, the board approved loaning the authority $400,000 but approval was contingent on another agreement that protected the city's interests.

If the partners were not successful in securing tax credits the city would have no obligation to loan the money, Rood said. In October the partners had not received the credits. The board rescinded the promise of a loan.

"A full month after that the credits were finally awarded," Rood said.

Beyond Shelter Housing Corp. and the Housing Authority received a reservation of $8.3 million in tax credits in November.

With the promise of those credits, the authority and its partners took out loans to fund the construction of low-income senior apartements — Victoria Manor — on Rancho Frontera Avenue and Highway 98.

In a month or so the apartments will be complete and the authority and Beyond Shelter will have to pay money they said they would before the tax credit committee issues the millions of dollars in credits.

Gevorgian had said he had "proof" showing the city was bound to its promise of a $400,000 loan. Rood said he has looked over Gevorgian's proof and found it lacking.

Rood said he received information from the Tax Credit Allocation Committee, City Manager Richard Inman and city Economic Development Director Ralph Morales. Rood said the city had no legal obligation to give the authority any money but it could do so if it decides to.

"Mr. Gevorgian is asking for you to reconsider your decision. As a public policy matter, I think you can," Rood said.

Councilman Javier Alatorre asked for staff's recommendation. Inman said the question is whether the Victoria Manor housing project will be completed without city assistance.

"It's not going to have an impact either way whether the board acts or not," Inman said.

Mayor Victor Carrillo said the $400,000 could be used for other housing projects.

"They don't need our $400,000," Carrillo said.

Councilman Gilbert Grijalva asked if the letter and information Rood received had made a difference in his thinking. Rood said the information confirmed what he had already known and used to make his earlier decisions.

Mayor Pro Tem John Renison asked if it was so important, why there was no one from the athority at Tuesday's meeting asking for the money.

Gevorgian said, "I'm representing the Housing Authority."

Renison said, "How is that even possible?"

Gevorgian said, "I'm the consultant who put together the application."

A Beyond Shelter representative said Gevorgian works on commission.

Gevorgian said, "Money is still required to take out the construction funding. This money ($400,000) is relied on."

No one from the authority has said whether it could take out a loan instead of asking the city for money.

Carrillo told Gevorgian, "Housing Authority was aware of the action that fall. Anything else? Call the question."

Councilman Frank Montoya, Carrillo and Renison voted to deny Gevorgian's request. Alatorre and Grijalva voted to approve his request.

In other business, the board approved a contract with U.S. Data Source.

The Los Angeles-based data production company will get a $200,000 grant and a $200,000 loan to help retrofit the old Kmart building on Yourman Road to serve as its Calexico base of operations.

U.S. Data Source has vowed to employ a good number of Calexicans. Renison wanted to know how that was being monitored.

Inman said city staffers check with the companies quarterly to make sure its hires are local.

The city has similar deals with the Calexico 10 Theaters and Calexico Tissue Co.

>> Staff Writer Aaron Claverie can be reached at 337-3419 or

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