The Carlsbad City Council agreed to reissue tax-exempt multifamily housing revenue bonds for a 106-unit affordable rental housing complex during its Jan. 9 meeting.
In 2003, the city issued $6 million in bonds to fund Mariposa Apartments. The bonds faced a redemption deadline of Feb. 1, 2024, requiring a mandatory public hearing to gather community input under the federal Tax and Equity Fiscal Responsibility Act, or TEFRA.
No public speakers commented during the TEFRA hearing on Jan. 9, and the council subsequently approved the resolution.
Due to increased interest rates, the council authorized amending the terms and conditions of the bonds, raising the maximum interest rate to 4.408% annually to remarket the bonds until their maturity date.
The city’s multifamily revenue bonds for Mariposa currently hold an outstanding principal balance of $3.65 million.
The Mariposa Apartments, located on the west side of College Boulevard and just south of Tamarack Avenue, offer one-, two-, and three-bedroom apartments for low-income households.
When initially constructed, the project drew on various funding mechanisms, such as land, master developer credit, tax credit equity, and state and municipal loans. In addition, the city also applied for a tax-exempt bond allocation and issued multifamily revenue bonds to keep rental prices affordable for lower-income renters, the staff report said.
Mayor Keith Blackburn praised the work of Mariposa Apartments’ management firm, Chelsea Investment Corporation.
“Chelsea Investment has done a lot of work in this city, and to date, I haven’t heard one complaint from anybody about the work they’ve accomplished,” Blackburn said.
The city emphasized that the Mariposa bonds are not Carlsbad’s debt obligation, and the city has no financial responsibility for the project or bond repayment — the project owner will cover these expenses.