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Yucca Valley Senior Housing Scheme-Nuaimi Commits Town to $3.2 million Dollars

By   /   January 3, 2013  /   16 Comments

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Yucca Valley, Ca.,-OPINION-Quick! Pull the plug on this run-away project asap! Why would anyone approve a plan to build 74 Senior Housing one-bedroom units at a cost of $227,299.00 per unit, or $140.00 per square foot, for a total construction cost of $17,047,409.00?

That is the Senior Housing proposal pushed forward by Yucca Valley Town Manager, Mark Nuaimi, with his associates at C.O.R.E. of Rancho Cucamonga, DBA, Yucca Valley Senior Housing Partners.

May 2011, application for HUD 202 Funding:

A RDA Staff report dated May 17, 2011, states the (RDA) “Agency” and C.O.R.E. would actively seek  $1.5 million San Bernadino County HOME funds to reduce the  Town’s financial commitment from $3.2 million to $1.7 million and any savings in project costs would offset the “Agency”contribution to the project. **But that did not happen!

In a funding commitment letter dated May 18, 2011 addressed to Orlando Cabrera, signed by Yucca Valley Town Manager Mark Nuaimi, he outlines the terms of the loan by the Town of Yucca Valley. The loan amount of $3.2 million dollars for 55 years at a simple 1% interest rate and the appraised property valued at $941,000 will be transferred for $1 (one dollar), the loan will be a residual receipts loan and no mandatory periodic payments will be due during the term of the loan. (page 69 of 207 pages>>Doc.)

Bottom line-This loan will NEVER be paid back. The $3.2 million dollar commitment was SUPPOSED to be only for the application for two rounds of HUD funding seeking $14 million dollars, which were unsuccessful.

Original construction costs were submitted at $21 million dollars, and the Town’s original commitment was $1.5 million dollars. It appears this Nuaimi Senior Housing project has spun out of control. The five-page Project Staff Report dated October 10, 2012, “CALIFORNIA TAX CREDIT ALLOCATION COMMITTEE” outlines the amount of total funds committed for this project:

Town of Yucca Valley.
Construction Financing:                      Permanent Financing:
$1,540,000                                                               $2,925,000

**Please note in the above document, the SB County HOME funds did NOT lower the Town’s obligation nor did the reduction in construction costs from $21 million to $17 million lower the Town’s contribution.

Nuaimi writes: “Senior housing project is a residual receipts loan. If there are not residual receipts from the operation of the affordable housing project, then the investment value continues to accrue interest and the Town has an ownership interest in the project at the end of the 55 year operating covenant. Nobody EVER guaranteed that the residual receipts loan would be repaid. It is an investment made from low/mod funds, redevelopment land, and development impact fees.”

So there it is, a non-existent pay back schedule of $2,000 per year in the 10th year and $179 in the 15th year, after everyone else gets paid to run and operate this Project. Go to page 44-link

Accruing “ownership interest”  is almost comical and the Town Council is buying this BS?  The Town gets the building back 55 years from now and I ask, will pre-fab last that long?

It’s time to stop this madness and pull the plug on this project. The Town of Yucca Valley does not have sufficient funds in low/mod funds, the value of RDA land is $941,000, there are NO MORE RDA funds, C.O.R.E. borrowed $500,000 and there are no Development Impact Fees in the till. (Besides, $350,000.00 on future DIFs was loaned internally to complete the gap funding to build the dog park.)

One more thing…..Measure U was defeated.

Margo Sturges Author link

See also:  Nuaimi’s Senior Housing Fiasco when he was employed by the City of Colton? Colton Palms Project


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About the author

Margo Sturges

Yucca Valley Editor

Note: Margo Sturges has written many articles for Cactus Thorns and is the founder of Citizens4Change.info. Email contact: MargoSturgesYV(at)aol.com "In a time of universal deceit, telling the truth becomes a revolutionary act."- George Orwell


  1. Mark Nuaimi Mark Nuaimi says:

    Now for some facts:

    FACT — the HUD proposed project was a higher cost project because HUD mandates prevailing wage construction. The current project is being funded primarily with tax credits, not requiring prevailing wage;

    FACT — the total project costs aren’t simply constructing apartments — they are purchasing affordability covenants on the apartments for 55-years to maintain the apartments in the very low and low income category for seniors;

    FACT — the project costs include payment of development impact fees. Those funds are included in the amount of Town contribution and being loaned back for the project;

    FACT — the project costs include the construction of regional infrastructure for flood control and road improvements/traffic signal of Dumosa & SR-62. The Town DOES have Development Impact Fees from the SuperWalmart project for flood control improvements that are being invested in this project. There are also transportation funds the Town council approved as part of the Town’s contribution to this project;

    FACT — the current transaction is detailed in the staff report from July 24, 2012. The transaction details from May 2011 have been consummated in the Disposition and Development Agreement, entered in March 2012 and amended in July 2012:


    FACT: The Town’s loan amount ($2.9 million) is still below the original commitment made of $3.2 million. Town staff laid out the funding strategy in the staff report (above) on stamped page 215.

    FACT: Tax credits are awarded on a competitive basis. The tie-breaker is calculated based upon the amount of local agency investment in the project. In March 2012, the developer submitted a TCAC application with substantially less local funds. The project was not successful in securing tax credits. In the latest round, the Town Council increased the Town’s local agency contribution and the project won the tie-breaker;

    In the body of this “story”, there are obvious contradictions:

    “Original construction costs were submitted at $21 million dollars, and the Town’s original commitment was $1.5 million dollars. It appears this Nuaimi Senior Housing project has spun out of control.”

    “In a funding commitment letter dated May 18, 2011 addressed to Orlando Cabrera, signed by Yucca Valley Town Manager Mark Nuaimi, he outlines the terms of the loan by the Town of Yucca Valley. The loan amount of $3.2 million dollars for 55 years at a simple 1% interest rate and the appraised property valued at $941,000 will be transferred for $1 (one dollar),…”

    So the original funding commitment was $3.2 million and Ms. Sturges knows that fact … because she spoke in favor of the project and questioned the gap funding in May 2011:


    The fact is that this project has been before the Town Council since mid-2010 and has been debated / discussed at no fewer than five Town Council/RDA meetings. The Town Council determined prior to my employment their desire to deliver affordable housing when they put out a request for proposals/qualifications in mid-2010. There were months of community outreach and engagement concerning this project and the feedback from the senior community was considerable support.

    The original strategy was to fund the project using the HUD-202 program. The project was not selected by the HUD program during the one round this project submitted and there has not been another HUD-202 NOFA. The Developer and Town determined that pursuit of County HOME funds and Tax Credits was the best way to deliver this project.

  2. “Innovative Construction Strategy” reduced costs from $18.9 million to $17.3 million. No mention of Prevail wages. Stamp pg 214 (pdf pg 223 of 293 pages)


    • Fact: Project DOES NOT pencil out. “Town Loans” have been EXPOSED @55yr scheme-Nuaimi switches to “Investment.”

    • Mark Nuaimi Mark Nuaimi says:

      Both the $18.9 million and $17.3 figures are non-prevailing wage cost estimates since they were both tax credit applications. The reduction in costs was a result of going from on-site construction to factory construction of the 74 units. This saves both costs and time as the CORE staff shared at the town council meeting.

      • Dan OBrien Dan OBrien says:

        SO…. at the end of 55 years….. the town is left with owning outright 74 55 year old beat the shit of modular one bedroom units?????

        So local government puts up the money and this CORE outfit reaps the benefits of the local government largess…. never paying back the money and by contractual agreement never forced to pay the money back…. Wow. They zero investment and reap all the rewards… What a great deal…

        Are you actually proud of that negotiation?

        • Mark Nuaimi Mark Nuaimi says:

          At the end of 55 years, the Town and County will both have residual receipts notes against the property. The property will transition to a market rate project at that point and still be owned and operated by the NCRC LLC.

          Since the traditional mortgage is likely 30 years, from years 31 to 55 there will not be debt service payments going to the lender and there should be greater levels of residual receipts on an annual basis.

          As to the benefits, the community will have 74 units of affordable housing restricted for seniors. This project will be amenitized and well maintained, with property management and senior services integrated into the property. While the individual units are factory constructed, the common space (recreation & gathering places) within the complex will be constructed on-site.

          I do believe the entire team is proud of the fact that this quality project was successful in securing tax credits in a highly competitive process. This project will break ground within 18 months of signing the ENA … It is not uncommon for communities to wait for many years for such projects to be brought forward.

          Finally, the Town will be able to point to this project in our General Plan Housing Element to demonstrate our ability to support affordable housing development. This is critical when trying to get Housing Element certification from the state HCD. Without Housing Element certification, a community may lose grant and state funding opportunities and may expose itself to litigation for not having a certified Housing Element.

          • Dan OBrien Dan OBrien says:

            One more time…. at the end of 55 years….. the town is left with owning outright 74 55 year old beat the shit of modular one bedroom units?????

            Well I am sure that most folks would be glad to hear that the State of California did not buy into scheme either….

            Kind of reminds me of Professor Harold Hill. ….. Trouble, Yes Trouble, Right Here in River City….

            • Mark Nuaimi Mark Nuaimi says:

              One more time, NO. The property will continue to be owned by the LLC and the Town and County will have the residual receipts loans against the asset. Not sure what you mean about the state not buying into the scheme … the California Tax Credit Allocation Committee (CTCAC) is made up of state agencies and the tax credits they awarded are the primary financial source.

              Honest to goodness Dan, this arrangement is the same type of transaction that has taken place HUNDREDS of times throughout the state, with THOUSANDS of affordable units generated by these types of arrangements.

            • Dan OBrien Dan OBrien says:

              Honest to goodness Mark, how has that worked out for the State’s Bottom Line? What it tells me is the CTCAC is FUBAR

              We have a broken system and it would seem that you are making a sweetheart deal for a management company and little if anything is to the advantage of your town…. The management Company has no investment and gains all the monetary return….

              This reminds me of teenagers and jumping off bridges… Who gives a rats butt if a Thousand other cities and towns were stupid enough to set up a deal like that?

              The idea of doing business is making a beneficial relationship that everyone makes a buck. You’ve got it where the Town never makes it’s money back… And then you tell me the great thing is after 55 years the Management Company turns over a 55 year old Public Housing Project…. Are you kidding me? Its like turning over a 74 unit worn out fire trap of beat the hell out of modular constructed apartments… They would be ready to be demolished at that point… Where is the benefit to the town? Get serious….

        • Scots Slant Scots Slant says:

          Gee Dan, you have a really neat house; that has to be at least about 75 sq. ft.

          Does it have any cool amenities like heat and air with indoor plumbing or do you rough it with an outhouse and wood stove?

  3. Sturges-the ONLY Public Comment speaker, was denied 2 extra minutes by Mayor Rowe to address the NEW information presented by Nuaimi NOT in agenda packet.

    Sturges stood in silence for the remaining three minutes AND the entire event was SCRUBBED from being reflected in the minutes.

    Sturges had to protest the minutes prior to Council’s approval to demand they reflect the actual events of not being granted to speak for 5 minutes instead off 3 minutes on this multi-million dollar Senior Housing scheme.

    See Stamp page 8 of 11 page Agenda Link below:


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