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[Board Meeting on October 10, 2024.]
IT IS 10 A.M.WE WILL START OUT WITH THE ROLL CALL TODAY.
WE WILL START OUT AS WE USUALLY DO WITH BOBBY LEADING US IN THE PLEDGES.
I PLEDGE ALLEGIANCE TO THE FLAG OF THE UNITED STATES OF AMERICA.
AND TO THE REPUBLIC FOR WHICH IT STANDS.
ONE NATION UNDER GOD, INDIVISIBLE, WITH LIBERTY AND JUSTICE FOR ALL.
UNDER THE TEXAS FLAG, I PLEDGE ALLEGIANCE TO THEE.
TEXAS. ONE STATE UNDER GOD, ONE AND INDIVISIBLE.
I'D SAY PLAY BALL, BUT WE'RE NOT PLAYING BALL ANYMORE THIS YEAR.
WE HAVE A RELATIVELY FULL AGENDA TODAY, SO ASK EVERYONE TO TRY TO KEEP IT FAST, KEEP IT SHORT, AND WE'LL WE'LL MAKE IT THROUGH. WE HAVE WE ARE GOING TO HAVE AN EXECUTIVE SESSION FOR JUST A SHORT EXECUTIVE SESSION FOR A COUPLE OF MINUTES.
BUT WE WILL START OUT WITH THE CONSENT AGENDA.
IT'S MY UNDERSTANDING THAT WE HAVE ITEM TWO IS PULLED FROM THE CONSENT.
SO SO ITEM TWO IS ALREADY PULLED FROM THE CONSENT AGENDA.
ARE THERE ANY OTHER ITEMS THAT A BOARD MEMBER OR MEMBER OF THE PUBLIC WANTS US TO REMOVE FROM CONSENT? SEEING NONE, I'LL CALL FOR A MOTION ON THE CONSENT AGENDA WITH THE EXCEPTION OF ITEM NUMBER TWO.
MR. CHAIRMAN, I MOVE THAT THE BOARD APPROVE STAFF RECOMMENDATIONS REGARDING ITEMS ONE, WITHDRAWN, TWO AND FOUR THROUGH SEVEN, AS DESCRIBED AND PRESENTED IN THE BOARD ACTION REQUEST ON THIS MATTER.
OKAY. THERE'S THREE THROUGH SEVEN AND THREE HAS ALSO BEEN PULLED.
MOTION. MOTION MADE BY MISS FARIAS.
AYE. ANY OPPOSED? HEARING NONE. MOTION CARRIES.
NOW THAT WE HAVE EVERYONE SEATED PROPERLY, WHERE'S MY TEXT GO? I GOT HIGHLIGHTED HERE.
OKAY. THE GOVERNING BOARD OF THE TEXAS DEPARTMENT OF HOUSING AND COMMUNITY AFFAIRS WILL GO INTO CLOSED OR EXECUTIVE SESSION AT THIS TIME, PURSUANT TO TEXAS GOVERNMENT CODE SECTION 551.071, TO SEEK AND RECEIVE THE LEGAL ADVICE OF ITS ATTORNEY OR TO DISCUSS PENDING OR CONTEMPLATED LITIGATION.
THE CLOSED SESSION WILL BE HELD IN THE CONFERENCE ROOM AT THE ADJOINING HERE IN THE BACK.
THE DATE IS STILL OCTOBER 10TH, 2024 AND THE TIME IS 1003.
WE'LL BE RIGHT BACK. THANK YOU.
OKAY. THE BOARD IS RECONVENED IN OPEN SESSION AT 10:21 A.M.
WE ARE NOW BACK TO THE REGULAR SCHEDULE WHERE WE ARE AT.
CORRECT, MR. WILKINSON? ALL RIGHT. THANK YOU. CHAIRMAN.
AS A REMINDER, WE GOT A IN THE AMERICAN RESCUE PLAN.
WE GOT A SPECIAL ALLOCATION OF HOME DOLLARS THAT CAN BE USED FOR LIKE, CAPITAL CONSTRUCTION, FOR NON-CONGREGATE SHELTER AND SOME OTHER THINGS THAT WE DON'T OFTEN GET TO DO. WE HAVE SOME SOME NEWS FROM THE HOME ARP PROGRAM.
OUR HOME ARP MANAGER TIARA HADAWAY, IS LEAVING TDHCA ON OCTOBER 18TH.
I WANT TO GIVE A WAVE. THANK YOU SO MUCH.
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ALSO, YOU MAY REMEMBER BURNET PLACE, WHICH WAS THE FIRST AWARD FOR HOME-ARP BACK IN JANUARY 2023.WE'RE TOLD THEY HAVE BEGUN MOVING TENANTS INTO THEIR UNITS.
THE HOMEOWNERS ASSISTANCE FUND PROGRAM.
IT'S BEEN A FEW MONTHS SINCE WE'VE TALKED ABOUT HALF.
AS OF TUESDAY, HALF HAS PROVIDED ASSISTANCE TO 58,514 UNIQUE HOUSEHOLDS, WITH AVERAGE ASSISTANCE PER HOUSEHOLD TOTALING $12,618 TO DATE.
HALF IS PAID OUT A TOTAL OF 739.3 MILLION IN ASSISTANCE, AND ALL FUNDS HAVE BEEN COMMITTED.
THE PROGRAM IS IN PHASE THREE, MAKING FINAL PAYMENTS TO APPROVED HOUSEHOLDS.
WE TOOK DOWN THE HALF WEBSITE EARLIER THIS WEEK, AND FOLKS ARE NOW BEING REDIRECTED TO TDHCA GENERAL WEBSITE FOR INFORMATION FOR THE MULTIFAMILY DIRECT LOAN PROGRAM, MFL.
MFL WAS SUCCESSFUL IN COMMITTING THE DEPARTMENT'S 2022 NWTF GRANT OF $47 MILLION TO MULTIFAMILY DEVELOPMENTS THROUGHOUT THE STATE, THE LARGEST ALLOCATION OF NWTF FUNDS.
TDA HAS RECEIVED TO DATE GREAT ACCOMPLISHMENT BY OUR STAFF AND THE DEPARTMENT, BUT EVEN MORE SO FOR THE TEXAS COMMUNITIES RECEIVING THIS FUNDING THAT PROVIDES DEEP AFFORDABILITY FOR DECADES TO COME.
WE GET 30% AMI UNITS FOR OUR HF LOANS.
THEY GET A GOOD INTEREST RATE.
SO YOU KNOW IT'S A WIN WIN RIGHT? GREAT JOB EVERYONE.
CONTINUING THE GOOD NEWS ON THIS FRONT FOR HHS, THEY JUST COMPLETED AN MOU WITH THE TEXAS VETERANS COMMISSION TO PROVIDE THREE YEARS OF SUPPORT FOR STAFFING AND TVC'S HOMELESS VETERANS PROGRAM WITH APPROXIMATELY 567,000IN FUNDS.
THE ACTIVITIES SUPPORTED BY THIS MOU BETWEEN THE DEPARTMENT AND TVC WERE SO SUCCESSFUL THAT TVC LEADERSHIP WAS ABLE TO SECURE PERMANENT FUNDING AND RETAIN TWO STAFF MEMBERS DEDICATED TO SERVING THE HOMELESS VETERAN POPULATION.
SHOUT OUT TO KATE TRACE AND HER TEAM.
OKAY, SHE'S NOT HERE, BUT SHE'S WATCHING, I'M SURE.
THANK YOU. ANY BOARD MEMBERS HAVE QUESTIONS FOR MR. WILKINSON? HEARING NONE.
MOVING ON TO ITEM NINE OF THE AGENDA REPORT REGARDING A REQUEST FOR PROPOSAL ISSUED BY THE TEXAS DEPARTMENT OF HOUSING AND COMMUNITY AFFAIRS FOR SERVICER, OVERSIGHT, PROVIDER AND SELECTION THEREOF.
SCOTT FLETCHER DIRECTOR OF BOND FINANCE FOR TDHCA.
THE RFP HAD A SUBMISSION DEADLINE OF MAY 9TH, 2024.
THREE PROPOSALS WERE RECEIVED.
SERVICER OVERSIGHT ACTIVITIES WILL INCLUDE A REVIEW OF HISTORIC PERFORMANCE AND SERVICING OF THE DEPARTMENT LOANS BY OUR SERVICERS, INCLUDING COMPLIANCE WITH HUD AND HFA GUIDELINES, COMPLIANCE WITH INTERNAL POLICIES AND PROCEDURES.
ADHERENCE WITH INDUSTRY BEST PRACTICES RELATED TO TIMELY LOAN PROCESSING, PROCESSING, LOSS MITIGATION, DELINQUENCY MANAGEMENT, FORECLOSURES, LOAN MODIFICATIONS, AND SECOND LIEN RECOVERY. THE DEPARTMENT HAS AN OBLIGATION TO ENSURE TDHCA ORIGINATED LOANS ARE SERVICED.
ACCORDING TO HUD AND HFA GUIDELINES.
ADDITIONALLY, THE DEPARTMENT RETAINS SOME RISK ON OUR CURRENT SERVICING PORTFOLIO.
AND ENHANCED OVERSIGHT IS PRUDENT.
AUDIT AND REVIEW OF SERVICER ACTIVITIES IS AN INDUSTRY BEST PRACTICE.
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CONSECUTIVE YEARS.OKAY, GREAT. SO THIS IS AN ADDED MORE INTENSE OVERSIGHT THAT WE'RE GOING TO CORRECT.
WE'VE BEEN RECEIVING REPORTS MORE THAN ACTUALLY ACTIVELY OVERSIGHT.
CORRECT. YOU KNOW, WE GET REPORTS ON A MONTHLY BASIS FROM OUR SERVICER ON BOTH FIRST AND SECOND LIEN LOANS, LOSS MITIGATION ACTIVITIES DELINQUENCY REPORTS, ETC..
THIS IS THERE'S REALLY A SEVERAL PIECES RELATED TO THIS WITH OUR SERVICING PORTFOLIO.
TOTAL SERVICING PORTFOLIO, JUST OVER 8 BILLION APPROACHING $9 BILLION.
WE REALLY FELT LIKE WE NEEDED TO LAYER IN SOME ADDITIONAL RESOURCES IN TERMS OF ONGOING OVERSIGHT, IN TERMS OF, OF CONTRACT AND AGREEMENTS IN TERMS OF, OF WHAT WE HAVE IN THOSE AGREEMENTS TO PROTECT THE DEPARTMENT.
AND SO THIS IS THESE ARE EXPERTS THAT THAT DO THIS FOR, FOR MANY FIRMS. AND THEIR EXPERTISE IS ALREADY PROVING VALUABLE IN TERMS OF THE CONVERSATIONS THAT WE'VE BEEN HAVING.
AND BOARD MEMBERS HAVE QUESTIONS ON THIS REPORT ITEM.
HEARING NONE. THANK YOU FOR THAT REPORT.
MR. CAMPBELL, YOU TELL US WHAT WE'RE ABOUT TO SEE.
MY NAME IS CODY CAMPBELL, AND I AM THE DIRECTOR OF MULTIFAMILY PROGRAMS FOR THE DEPARTMENT.
OKAY. AND THIS ALSO REMINDS ME THE IF YOU'RE GOING TO BE SPEAKING ON AN ITEM COMING UP ON THE AGENDA, PLEASE COME FORWARD TO THE FIRST COUPLE OF ROWS. SO I MORE AWARE THAT YOU ALL ARE GOING TO BE THERE.
THIS ONE WE DON'T THIS IS NOT AN ECCLES RULE BECAUSE THIS IS ACTUALLY A POSTED DO WE STILL NEED A MOTION? STILL MOTION FOR PUBLIC COMMENTS.
YEAH. WOULD ANYONE CARE TO MAKE A MOTION FOR PUBLIC COMMENT? MOTION TO ACCEPT PUBLIC COMMENT ON ALL THAT.
OKAY. MOTION MADE BY MR. MARCHANT. SECONDED BY MR. HARPER FOR RECEIVING PUBLIC COMMENT TODAY.
AYE. ANY OPPOSED? HEARING NONE. MOTION CARRIES.
AGAIN, PLEASE TRY TO KEEP THIS AS CONCISE AS POSSIBLE.
WE HAVE MATERIALS HERE IN THE IN THE BOARD BOOK.
BUT WE'D LOVE TO HEAR Y'ALL'S INPUT.
EACH INDIVIDUAL STILL IDENTIFIERS YOUR NAME AND YOUR ORGANIZATION.
I AM THE HOUSING POLICY SPECIALIST WITH DISABILITY RIGHTS TEXAS, AND I'M HERE TODAY AS PART OF A COALITION OF NONPROFIT AND COMMUNITY PARTNER ORGANIZATIONS TO DISCUSS OUR PERSPECTIVES ON THE CURRENT AND FUTURE LANDSCAPE OF THE LOW INCOME HOUSING TAX CREDIT PROGRAM.
I REALLY APPRECIATE EVERYONE ALLOWING US TO GIVE THIS PRESENTATION TODAY.
OUR OBJECTIVE IS TO EDUCATE EVERYONE ABOUT PERSPECTIVES ON THE LATECH PROGRAM THROUGH THE LENS OF THE ORGANIZATIONS AND PEOPLE THAT WE, AS NONPROFIT AND COMMUNITY PARTNERS, REPRESENT. WE'LL DO SO BY PROVIDING INFORMATION ABOUT THE CURRENT HOUSING LANDSCAPE, EXPLORING THE GOALS OF THE PROGRAM, AND MAKING SURE RECOMMENDATIONS OR MAKING RECOMMENDATIONS ON HOW TO ALIGN PROGRAMMATIC OUTCOMES WITH THOSE GOALS.
HOWEVER, SINCE THE PROGRAM IS A PUBLIC SUBSIDY AND IT IS OVERPRESCRIBED, WE HAVE THE OPPORTUNITY AND THE OBLIGATION TO USE THE TOOL TO PRODUCE THE BEST OUTCOMES FOR CLIENTS WHICH ARE LOW INCOME TENANTS.
THIS MEANS WORKING TO STRIKE A BALANCE BETWEEN THE NUMBER OF UNITS AND THE THINGS THAT MAKE LIGHT TECH UNIQUE, INCLUDING THE DEEPEST POSSIBLE AFFORDABILITY, ACCESS TO HIGH OPPORTUNITY AREAS, AND OTHER AMENITIES THAT ARE APPROPRIATE AND USEFUL TO RESIDENTS.
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WHICH ARE THE RESIDENTS? CONSENSUS SOLUTIONS ARE OFTEN TOUTED WHEN CREATING CHANGE IN THIS PROGRAM, BUT WHEN CHANGES ARE PROPOSED, WHETHER IN THE SCP OR ANY OTHER RULE PERTAINING TO THE PROGRAM, SOLUTIONS CAN ONLY BE CONSIDERED CONSENSUS IF THEY ARE REACHED BY NOT JUST THE INDUSTRY, BUT ALL INTERESTED STAKEHOLDERS.IT IS IMPERATIVE THAT RESIDENTS, AS WELL AS THE ORGANIZATIONS THAT ARE COMMITTED TO IMPROVING THEIR HOUSING OUTCOMES, ARE FEATURED PROMINENTLY IN ANY DISCUSSIONS AND GIVEN THE SAME DEFERENCE AS THOSE WHO BUILD THESE DEVELOPMENTS.
I'M GOING TO GO TO SLIDE FOUR.
IN AUGUST, THE STATE COMPTROLLER'S OFFICE PUBLISHED A REPORT ENTITLED THE HOUSING AFFORDABILITY CHALLENGE, THE CRUX OF WHICH IS THAT TEXAS HAS A DEARTH OF HOUSING THAT IS AVAILABLE AND AFFORDABLE TO THOSE WHO NEED IT.
PER THE TEXAS A&M REAL ESTATE RESEARCH CENTER, MEDIAN HOME PRICES IN TEXAS INCREASED BY NEARLY 40% BETWEEN 2019 AND 2023, WHICH CREATED HISTORIC HOUSING AFFORDABILITY CONCERNS, ESPECIALLY FOR TEXAS'S EXTREMELY LOW INCOME RESIDENTS.
THESE ARE HOUSEHOLDS WITH INCOMES AT OR BELOW 30% OF THE AREA MEDIAN INCOME.
A HOUSEHOLD IS CONSIDERED TO BE COST BURDENED IF THEY SPEND MORE THAN 30% OF THEIR INCOME ON HOUSING AND SEVERELY COST BURDENED IF THEY SPEND MORE THAN 50% OF THEIR INCOME ON HOUSING. WHEN A PERSON SPENDS MORE THAN 30% OF THEIR INCOME ON HOUSING, THEY DO NOT HAVE ENOUGH INCOME LEFT OVER FOR THE OTHER THINGS THAT THEY NEED, INCLUDING THINGS LIKE FOOD, HEALTH INSURANCE, OR CHILDCARE.
THE A&M REAL ESTATE RESEARCH CENTER CITES THAT AS OF 2022, 39% OF TEXAS HOUSEHOLDS ARE.
EXCUSE ME? YEAH, WE'RE COST BURDENED.
AND IT IS PARTICULARLY ACUTE FOR EXTREMELY LOW INCOME HOUSEHOLDS.
88% OF HOUSEHOLDS WITH INCOMES AT OR BELOW $20,000 A YEAR ARE CONSIDERED COST BURDENED, COMPARED TO ONLY 8% OF THOSE WHO MAKE $75,000 OR MORE A YEAR.
I'M GOING TO TURN TO SLIDE FIVE.
YOU CAN SEE THAT THE DATA FROM THE NATIONAL LOW INCOME HOUSING COALITION GAP REPORT, ILLUSTRATING THAT THE STATE'S HOUSING NEEDS ARE MOST ACUTE FOR ITS LOWEST INCOME HOUSEHOLDS. THE GRAPH ON THE LEFT DEPICTS COST BURDEN AS IT RELATES TO INCOME GROUP.
79% OF THE SAME GROUP IS SEVERELY COST BURDENED.
AT THE OTHER END, ONLY 26% OF MIDDLE INCOME RENTERS MAKING 81 TO 100% OF AREA MEDIAN INCOME ARE COST BURDENED, AND ONLY 2% ARE CONSIDERED TO BE SEVERELY COST BURDENED.
THE LESS INCOME YOU HAVE, THE MORE LIKELY IT IS THAT YOU WILL HAVE TO SPEND ENOUGH OF YOUR INCOME ON HOUSING THAT YOU WON'T HAVE ENOUGH LEFT OVER TO PAY FOR EVERYTHING ELSE YOU NEED. IT'S ALSO WORTH NOTING THAT HIGHER INCOME HOUSEHOLDS HAVE THE OPTION TO RENT UNITS BELOW WHAT THEY CAN AFFORD, SOMETHING THAT EXTREMELY LOW INCOME HOUSEHOLDS CANNOT DO. THIS IS A PERFECT EXAMPLE OF WHY DEEPLY DEEP AFFORDABILITY IN THE TECH PROGRAM IS CRITICALLY COMPONENT OR IMPORTANT, AND ONE OF THE MOST IMPORTANT COMPONENTS OF THE PROGRAM.
AT THE TOP, YOU CAN SEE THAT THERE ARE MORE THAN ENOUGH UNITS AVAILABLE AND AFFORDABLE TO HOUSEHOLDS AT OR BELOW 100% AMI, AND VERY NEARLY ENOUGH FOR HOUSEHOLDS AT OR BELOW 80%.
BUT THERE ARE ONLY 45 UNITS AFFORDABLE AND AVAILABLE PER 100 HOUSEHOLDS, MAKING AT OR BELOW 50% IN A VERY LOW 25 PER 100 WHO NEED THEM AVAILABLE AT EXTREMELY LOW INCOME HOUSEHOLDS.
THAT PUTS TEXAS AT 46 OUT OF 51 IN TERMS OF AVAILABILITY FOR THESE UNITS.
THE COMPTROLLER'S REPORT ALSO HIGHLIGHTS THE CURRENT SHORTAGE OF RENTAL UNITS AS AN AFFORDABILITY CONCERN, STATING, QUOTE, SHRINKING SUPPLY OF LOW INCOME UNITS AS THE GREATEST CHALLENGE TO RENTERS IN TEXAS, THERE IS A SHORTAGE OF WELL OVER 670,000 UNITS AFFORDABLE AND AVAILABLE TO THE EXTREMELY LOW INCOME HOUSEHOLDS WHO NEED THEM.
ON SLIDE SIX, YOU CAN SEE A GRAPH FROM THE HARVARD JOINT CENTER FOR HOUSING STUDIES, ILLUSTRATING THE NUMBER OF RENTAL UNITS AVAILABLE IN TEXAS BY PRICE BETWEEN 2012 AND 2022. THERE WAS A TREMENDOUS CHANGE IN THE TYPES OF RENTAL UNITS BEING BUILT IN THE STATE.
COMPARATIVELY, HOWEVER, THE OPPOSITE IS TRUE FOR HIGHER RENT UNITS.
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$1400 AND $1999 A MONTH.PUT INTO PERSPECTIVE, IN 2022, FEWER THAN 452,000 UNITS WERE BUILT, PRICED UNDER $600 A MONTH.
IN THAT SAME YEAR, OVER 1 MILLION UNITS WERE BUILT, PRICED AT $1400 TO $1999 A MONTH.
I'M GOING TO GO AHEAD AND KICK IT OVER TO MATT HULL.
HI. GOOD MORNING I'M MATT HULL, THE TEXAS ASSOCIATION OF COMMUNITY DEVELOPMENT CORPORATIONS.
AS YOU'RE AWARE, I'M SURE LATECH WAS PASSED IN 1986 AS PART OF THE TAX REFORM ACT, REALLY AS A REACTION TO SOME POLICIES THAT HAD BEEN PASSED IN THE EARLY 80S THAT HIGHLY INCENTIVIZED INDIVIDUALS TO INVEST IN AFFORDABLE HOUSING, TAKE THE PASSIVE LOSS DEDUCTIONS ON THOSE HAD UNINTENDED CONSEQUENCES OF NOT REINVESTING IN THOSE PROPERTIES. SO AT THAT TIME YOU HAD INDIVIDUAL INVESTORS REAPING GAINS BUT LETTING THE HOUSING DETERIORATE.
IN 86, CONGRESS WANTED TO ADDRESS THAT, AND LOGITECH WAS CREATED.
INTERESTINGLY ENOUGH, IT WAS REALLY PROMOTED BY THREE NONPROFIT NATIONAL ORGANIZATIONS ENTERPRISE FOUNDATION, NOW ENTERPRISE COMMUNITY PARTNERS, LISC AND THE NATIONAL LOW INCOME HOUSING COALITION.
KEEP IN MIND, THIS WAS THE 80S.
THIS IS DURING THE REAGAN ADMINISTRATION.
THERE WERE MASSIVE CUTS IN HOUSING BUDGETS.
AND SO SINCE IT WAS INCLUDED IN 86.
ONE, IT'S EXTREMELY COMPLICATED.
SINCE IT'S BEEN MADE PERMANENT, IT BENEFITS LARGE FINANCIAL INSTITUTIONS TO THE TUNE OF BILLIONS OF DOLLARS EVERY YEAR THROUGH NOT ONLY THE TAX CREDITS, THE DEPRECIATION, THE DEPRECIATION THAT THEY CAN TAKE, BUT ALSO THE CRA CREDIT THEY GET FOR IT.
BUT BECAUSE THE PROGRAM IS SO LUCRATIVE TO DEVELOPERS, BOTH NONPROFIT AND FOR PROFIT, THERE'S ALWAYS BEEN A PENDULUM SWING OF PUBLIC POLICY THAT HAS SHIFTED OVER TIME BETWEEN GETTING THE MOST UNITS ON THE GROUND AS CHEAPLY AS POSSIBLE AND CREATING THE MOST PUBLIC BENEFIT, LIKE TANYA ALLUDED TO.
BUT THERE'S ALWAYS BEEN THIS PUSH PULL BETWEEN DEVELOPERS AND TDHCA STAFF OVER THOSE POLICY ISSUES SITE SELECTION, INCOME TARGETING, AMENITIES, LOCATION TO TRANSPORTATION, ALL OF THOSE TYPICAL THINGS.
YOU KNOW, LABOR IS HIGH, MATERIALS ARE HIGH, COST OF LAND IS HIGH.
SUBSIDIES ARE NOT AT THEIR HIGHEST RIGHT NOW.
HOWEVER, JUST BECAUSE DEALS ARE MORE DIFFICULT TO PENCIL OUT NOW, DOES IT MEAN THAT WE NEED TO THROW AWAY ALL OF THOSE GOOD PUBLIC BENEFIT CONSIDERATIONS THAT HAVE BEEN PUT IN PLACE IN THE PAST? AND TO TALK MORE ABOUT THAT THE SPEAKERS BEHIND ME WILL BE ADDRESSING THOSE ISSUES.
SO AT THIS TIME I WANTED TO BRING UP BEN MARTIN WITH TEXAS HAUSERS.
THANK YOU. BUT MATT, DID YOU SIGN IN? DID I? I DON'T THINK YOU DID.
WITH THE BOARD'S PERMISSION, I'M GOING TO ACTUALLY SPEAK RIGHT NOW ON BEHALF OF ANNE LOT FROM INCLUSIVE COMMUNITIES PROJECT, WHO? DUE TO A TRAFFIC ACCIDENT AND CLOSED FREEWAY BEYOND HER CONTROL.
MISSED HER FLIGHT DOWN HERE TO SPEAK THIS MORNING.
SO I'M GOING TO SPEAK ON BEHALF OF ANNE AND THEN ON BEHALF OF TEXAS HAUSERS IN A FEW MINUTES.
SO FROM ANNE LOT OF INCLUSIVE COMMUNITIES PROJECT IN DALLAS, TEXAS.
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THANK YOU FOR THE OPPORTUNITY TO ADDRESS YOU ON MATTERS OF HOUSING POLICY FROM THE NONPROFIT AND COMMUNITY STAKEHOLDER PERSPECTIVE.THE ROUGHLY 321,000 OR SO HOUSEHOLDS LIVING IN LIHTC UNITS ACROSS THE STATE.
I WANT TO SPEAK TO THE QUESTION OF FEASIBILITY OF DEVELOPING AFFORDABLE HOUSING IN HIGH OPPORTUNITY AREAS, AS THAT TERM IS DEFINED IN EARLIER SHAPES, WELL-RESOURCED COMMUNITIES WITH LOW POVERTY, SOLID PUBLIC SCHOOLS AND LOW CRIME.
THE RESEARCH THAT SUGGESTS AFFORDABLE HOUSING AND LOW POVERTY COMMUNITIES PLAYS A POSITIVE ROLE IN DETERMINING OUR HEALTH, OUR ECONOMIC OPPORTUNITY AND OUR EDUCATIONAL OUTCOMES. THERE IS ALSO COMPELLING RESEARCH THAT SUGGESTS THAT LOCATION IS A CRITICAL FACTOR IN BREAKING INTERGENERATIONAL POVERTY.
FOR EXAMPLE, THE RESEARCH OF RAJ CHETTY, AN ECONOMIC PROFESSOR AT HARVARD UNIVERSITY.
BUT IN CONCLUSION, ESPECIALLY FOR CHILDREN MOVING TO HIGH OPPORTUNITY AREAS, THEY'RE MORE LIKELY TO GRADUATE HIGH SCHOOL AND ATTEND COLLEGE? THEY EARN 30% MORE THAN LOW INCOME CHILDREN GROWING UP IN HIGH POVERTY NEIGHBORHOODS, AND THEIR LIFETIME EARNING POTENTIAL IS EXPECTED TO INCREASE BY APPROXIMATELY $300,000. TDCA PLAYS A CRITICAL ROLE IN NOT ONLY PROVIDING QUALITY, AFFORDABLE HOUSING, BUT ALSO IMPROVING THE LIFE OUTCOMES OF THOUSANDS OF LOW INCOME CHILDREN SERVED BY THIS PROGRAM.
BUT THERE WAS AN UPWARD TREND OF AWARDS IN LOW POVERTY CENSUS TRACKS BEGINNING IN 2008.
WE REALIZED THAT ICP LITIGATION WAS PART OF THE GENESIS FOR THIS UPWARD TREND, BUT THE TREND TOWARDS LOW POVERTY COMMUNITIES CONTINUED AFTER THE TERMS OF THE REMEDIAL ORDER WERE SATISFIED. AS WE CAN SEE WITH THE FIVE YEAR PERIOD BETWEEN 2016 AND 2020 REFERRED TO IN THE SLIDES.
BASICALLY, I'M SORRY I KIND OF MISSED DAN'S POINT HERE, BUT THE TREND OF MORE A HIGHER SHARE OF THE 9% PROPERTIES GOING INTO HIGHER OPPORTUNITY, HIGHER INCOME COMMUNITIES CONTINUED.
THAT ALSO TRENDS TOWARDS COMMUNITIES WITH A HIGHER SHARE OF WHITE, NON-HISPANIC RESIDENTS AND A LOWER SHARE OF BLACK AND HISPANIC RESIDENTS.
SO TDCA HAS MADE REAL STRIDES IN DECONCENTRATING ITS AFFORDABLE HOUSING STOCK.
WE UNDERSTAND THAT NOT ALL OF THE HOUSING WILL GO INTO LOW POVERTY AREAS, BUT BECAUSE THE LION'S SHARE OF THE EXISTING PORTFOLIO IS STILL IN HIGH POVERTY AREAS. WITH DALLAS LEADING THE PACK, WE EMPHASIZE THE NEED TO ADMINISTER THE PROGRAM IN A WAY THAT DOES NOT PERPETUATE RACIAL SEGREGATION BY INCENTIVIZING DEVELOPMENT IN LOW POVERTY.
OH. YEAH. BY INCENTIVIZING DEVELOPMENT AND LOW POVERTY CENSUS TRACTS.
IN DOING SO, YOU WILL PROVIDE LOW INCOME HOUSEHOLDS WITH ACCESS TO OPPORTUNITY.
AND WITH THAT, I WILL TURN IT OVER TO ERIK SAMUELS.
ALL RIGHT. I'M SORRY I HAD TO STEP OUT.
I HAD TO MAKE SURE EVERYTHING WAS OKAY AND EVERYTHING'S OKAY, SO THAT'S GOOD.
I'M ERIK SAMUELS. I'M THE PRESIDENT AND CEO OF TEXAS HOMELESS NETWORK.
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EXPERIENCING HOMELESSNESS.MANY NEED SPECIAL ACCOMMODATIONS AND DEPEND GREATLY ON THE LOCATION OF THEIR HOUSING TO FULFILL THE HEALTH AND SUPPORTIVE SERVICE NEEDS CRITICAL TO THEIR DAY TO DAY LIVES AND OVERALL WELL-BEING.
LOOKING AT THE PAST, OR LOOKING AT THE BEST DATA WE HAVE ON PEOPLE WHO EXPERIENCED HOMELESSNESS OVER THE LAST TWO YEARS, A GROUP, BY THE WAY, THAT INCLUDES A HIGH RATE OF PEOPLE WITH DISABILITIES AND INCREASINGLY A HIGHER PERCENTAGE OF OLDER ADULTS.
YEAR AFTER YEAR, WE CAN SEE THAT OUR HOMELESS RESPONSE SYSTEM PROVIDERS HAVE HELPED OVER 27,000 PEOPLE ESCAPE HOMELESSNESS IN THIS TIME THROUGH 2022 AND 23.
MOST BECAUSE OF DEEPLY AFFORDABLE AND SUPPORTIVE HOUSING.
MUCH HAS BEEN CREATED THROUGH THE HOUSING TAX CREDIT PROGRAM, AND THIS IS GREAT NEWS.
AND YOU WOULD THINK WITH THAT AND THE FACT THAT WE'RE AVERAGING AROUND 71,000 PEOPLE A YEAR EXPERIENCING HOMELESSNESS THROUGHOUT THE STATE, WE WOULD START TO MAKE BIG STRIDES IN REDUCING HOMELESSNESS.
AND WHEN THINKING ABOUT THESE DATA, I NEED TO POINT OUT WE DON'T HAVE DATA FROM EVERY COMMUNITY.
SO THESE NUMBERS IN REALITY ARE MUCH HIGHER.
SO WE JUST CAN'T KEEP UP ON EITHER END.
WE DON'T HAVE ENOUGH AFFORDABLE AND SUPPORTIVE HOUSING TO PREVENT HOMELESSNESS ON THE FRONT END, AND WE DEFINITELY DON'T HAVE ENOUGH TO HELP THOSE ON THE OTHER END OF THIS JOURNEY SO THEY CAN ESCAPE HOMELESSNESS.
SO WE ASK YOU TO CONSIDER THE CRITICAL ROLE OF THE HOUSING TAX CREDIT PROGRAM AND THE CRITICAL ROLE IT PLAYS IN PROVIDING STABILITY FOR TEXANS WITH DISABILITIES, OLDER TEXANS AND THOSE EXPERIENCING HOMELESSNESS.
THANK YOU. AND STEVEN'S COMING UP TO SPEAK.
THANK YOU, BOARD, FOR THIS OPPORTUNITY.
OUR ORGANIZATION EQUIPS FAMILIES TO SECURE ECONOMIC MOBILITY AND INTERGENERATIONAL RESILIENCE BY ACQUIRING AFFORDABLE HOMES, ACCESSING QUALITY EDUCATION, MANAGING RISK AND BUILDING SAVINGS FOR LIFE.
WE'VE HELPED A THOUSAND FAMILIES EARNING AN AVERAGE OF $29,000 BUY A HOME OF THEIR CHOICE.
AND WE'VE ALSO DEVELOPED AMENITY FILLED RENTAL COMMUNITIES FOR HOMELESS WOMEN AND CHILDREN, VULNERABLE SENIORS, LOW INCOME WORKING FAMILIES AND YOUTH EXITING FOSTER CARE.
I RECOGNIZE THAT MARKET CONDITIONS CHANGE.
WHEN WE BUILT OUR FIRST 9% COMMUNITY 30 YEARS AGO, 312, TWO, THREE AND FOUR BEDROOM UNITS ON 33 SUBURBAN ACRES ACROSS FROM AN ELEMENTARY AND NEW MIDDLE SCHOOL.
MORTGAGE RATES THEN WERE 2% HIGHER AND CREDIT PRICES WERE $0.45.
THERE'S DECADES OF EXPERIENCE AMONG LOCAL, NONPROFIT AND FOR PROFIT DEVELOPERS ON HOW TO BUILD AND PRESERVE TEXAS AFFORDABLE PROPERTIES. ADVOCATES ARE ATTUNED TO THE NEEDS OF THEIR CONSTITUENTS, AND INSTITUTIONAL INSIGHTS HAVE ACCRUED HERE IN THE DEPARTMENT AS IT HAS STEWARDED THESE RESOURCES OVER MANY DECADES.
AND I KNOW THAT MEANINGFUL SERVICES ARE NOT LIMITED TO THOSE IN THE SHOP.
AS THE SENIORS WHO RIDE OUR FREE, LIFT EQUIPPED BUSSES WILL TELL YOU.
I DON'T WANT TO CHAMPION COSTS THAT DON'T PRODUCE VALUABLE OUTCOMES WHEN WELL IMPLEMENTED.
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SO LET'S WORK TOGETHER TO DELIVER THE BEST BANG FOR THE BUCK FOR THE DEPARTMENT'S CLIENTS.TEXANS WITH MODEST INCOMES GIVEN THE OPPORTUNITIES AND RESOURCES AT HAND.
THANK YOU. BEN MARTIN AGAIN TEXAS HOUSERS. SPEAKING AS MYSELF, LAST SPEAKER, THANK YOU SO MUCH FOR YOUR TIME THIS MORNING.
TEXAS HAWSERS HAS WORKED IN THE STATE OF TEXAS FOR OVER 30 YEARS, ALONGSIDE LOW INCOME TEXANS, TO ENSURE THAT THEY HAVE ACCESS TO HOUSING THAT IS AFFORDABLE, THAT IS STABLE, THAT IS DECENT, AND THAT IS FAIR WITH CHOICE.
TANYA BEGAN BY TALKING ABOUT HOW WE NEED TO WORK TOGETHER TO ENSURE THAT WE ARE ORIENTED DIRECTLY AT THE GOAL OF PROVIDING THE THE UNITS THAT ARE THE BEST FOR THE THE BENEFICIARIES OF THIS PROGRAM, TENANTS THAT THIS PROGRAM SERVES.
AND THAT'S GOING TO MEAN, AS WE'VE TALKED ABOUT TODAY, A BALANCE OF THE HIGHEST NUMBER OF UNITS THAT WE CAN ACHIEVE THAT ARE THAT PROVIDE THE DEEPEST AFFORDABILITY, THAT ARE IN GOOD QUALITY LOCATIONS, THAT ARE DECENT QUALITY UNITS AND PROVIDE APPROPRIATE AMENITIES TO SERVE THE TYPES OF POPULATIONS THAT ERIC SPOKE ABOUT.
THERE IS ALSO AN OPPORTUNITY HERE FOR A RENEWED COMMITMENT FROM THE AGENCY TO AN ENGAGEMENT PROCESS THAT INCLUDES ROOM FOR MEANINGFUL PARTICIPATION FROM ALL RELEVANT STAKEHOLDERS. THE STATE LOW INCOME HOUSING PLAN STATES THAT TDHCA BELIEVES THAT CONSULTATION WITH COMMUNITY ADVOCATES, FUNDING RECIPIENTS, POTENTIAL APPLICANTS FOR FUNDING AND SUBJECT MATTER EXPERTS IS AN ESSENTIAL PREREQUISITE PREREQUISITE TO THE DEVELOPMENT OF EFFECTIVE POLICIES, PROGRAMS, AND RULES. INDUSTRY PERSPECTIVES ARE CRITICAL TO MAKING THE TAX CREDIT PROGRAM A SUCCESS, AND SO ARE THE PERSPECTIVES OF CLIENTS AND BENEFICIARIES OF THE PROGRAM AND THOSE THAT ADVOCATE ON BEHALF OF THEM AND ALONGSIDE THEM.
ENGAGEMENT FOR NON-INDUSTRY STAKEHOLDERS IS CURRENTLY LIMITED IN SEVERAL WAYS.
SOME SOCIAL SERVICE AND ADVOCACY ORGANIZATIONS LACK THEIR INDUSTRY COUNTERPARTS LINE LEVEL EXPERTISE ON THE SHAPE, AND YET NEVERTHELESS STILL HAVE VALUABLE IDEAS AND EXPERTISE TO BRING TO THE TABLE.
THE BENEFICIARIES OF THE PROGRAM.
WE DO PERCEIVE A GAP BETWEEN THE TYPE OF COMMITMENT THAT MANY ORGANIZATIONS AND INDIVIDUALS CAN PROVIDE, AND THE TYPE OF COMMENTS THAT THE AGENCY IS PREPARED TO ABSORB AND ACT ON.
BUT LUCKILY, THERE ARE MANY RESOURCES TO HELP BRIDGE THAT GAP.
FOR EXAMPLE, THE INTERNATIONAL ASSOCIATION FOR PUBLIC PARTICIPATION CORE VALUES HAVE FOR YEARS BEEN CONSIDERED THE GOLD STANDARD FOR PUBLIC SECTOR ENGAGEMENT WITH COMMUNITY STAKEHOLDERS. THESE VALUES INCLUDE THE FOLLOWING.
PUBLIC PARTICIPATION SEEKS INPUT FROM PARTICIPANTS IN DESIGNING HOW THEY PARTICIPATE.
FOR EXAMPLE, TDHCA COULD TAKE STEPS LIKE THE FOLLOWING.
SURVEY EXISTING TENANTS MORE REGULARLY ABOUT THEIR NEEDS AND CONCERNS.
DEVELOP MATERIALS AND FACILITATION APPROACHES THAT MAKE ROOM FOR NON-EXPERT PARTICIPATION, AND REACH OUT PROACTIVELY AND DIRECTLY TO GROUPS WHO ARE UNDERREPRESENTED IN THE ENGAGEMENT PROCESS.
WE REALLY DO APPRECIATE THE OPPORTUNITY TO SPEAK TO YOU ALL THIS MORNING.
OBVIOUSLY, WE NEED CONTINUOUS INPUT FROM EVERYONE.
AND I NEED YOU ALL TO BE TALKING TO THE INDUSTRY FOLKS.
[00:40:05]
BECAUSE THEY'RE THE ONES THAT ARE BUILDING WHAT YOU ALL WANT THEM TO BUILD.SO LET'S JUST MAKE SURE THAT KIND OF LINES OF COMMUNICATION GO ON.
OBVIOUSLY, PLEASE KEEP TALKING WITH OUR OUR STAFF HERE AND LET'S FIND WAYS TO, YOU KNOW, GET OTHER PRIVATE SECTOR PHILANTHROPIC MONIES AND STUFF LIKE THAT.
BECAUSE BECAUSE THOSE CAN REALLY MAKE THE DIFFERENCE, I THINK, BETWEEN BRIDGING THE COST STRUCTURE THAT THE ADVOCATE, THE NEEDIEST, NEEDIEST PART OF THE COMMUNITY NEEDS AND THE SUPPORT OF HOUSING AND ALL THOSE THINGS, BUT THAT THE DEVELOPERS CAN'T PENCIL OUT ON JUST BECAUSE THEY JUST THE NUMBERS JUST DON'T WORK.
AND AS THEY KEEP DOING ALL THE REDEVELOPING OR REVISING THE THE TAX CREDIT PROGRAMS AND SUCH.
AGAIN, IT'S NOT GOING TO WORK WITHOUT ALL OF THESE PIECES TOGETHER.
ABSOLUTELY. HERE, HERE. AND WE ARE ENTHUSIASTIC ABOUT WORKING WITH INDUSTRY STAKEHOLDERS, INCLUDING TAP TO ADDRESS THEIR NEEDS WHILE ALSO CONTINUING TO IMPROVE OUTCOMES FOR THE PROGRAM BENEFICIARIES.
YEP. AND IF THEY ONLY ANSWER YOUR CALL, TELL ME AND I'LL MAKE SURE THEY CALL YOU BACK.
GREAT. APPRECIATE IT. THANKS FOR FOR COMING AND MAKING THE EFFORT.
AND AND TELL ANNE WE MISSED HER.
BOND. FINANCE. MR. FLETCHER, AGAIN. PRESENTATION, DISCUSSION AND POSSIBLE ACTION ON RESOLUTION NUMBER 25 001.
BOND SET ASIDE REQUIREMENTS AUTHORIZING THE EXECUTION OF DOCUMENTS AND INSTRUMENTS RELATING THERETO.
GOOD MORNING. SCOTT FLETCHER, DIRECTOR OF BOND FINANCE, TDHCA.
WITH THIS ITEM, STAFF IS SEEKING AUTHORIZATION TO REQUEST A WAIVER FROM THE BOND REVIEW BOARD OF THE SET ASIDE REQUIREMENTS OF CHAPTER 2306, SECTION 142 L OF THE TEXAS GOVERNMENT CODE, WHICH REQUIRES THE DEPARTMENT TO ALLOCATE THROUGH SET ASIDE OR RESERVATION OF FUNDS NOT LESS THAN 40% OF BOND PROCEEDS FOR EACH BOND ISSUE FOR MORTGAGE LOANS, INCLUDING SUBPRIME MORTGAGE LOANS TO BE ORIGINATED IN UNDERSERVED ECONOMIC AND GEOGRAPHIC SUBMARKETS IN THE STATE.
SECTION 142 M OF CHAPTER 2306 ALLOWS THE DEPARTMENT TO REQUEST A WAIVER FROM THE BOND REVIEW BOARD.
AT THIS TIME, STAFF IS REQUESTING AUTHORITY TO REQUEST A WAIVER FROM THE BOND REVIEW BOARD OF THE SET ASIDE REQUIREMENTS OF CHAPTER 2306, SECTION 142 L OF THE TEXAS GOVERNMENT CODE FOR SINGLE FAMILY REVENUE BONDS ISSUED IN CALENDAR YEAR 2025.
STIFEL, THE DEPARTMENT'S FINANCIAL ADVISOR, HAS UPDATED THE ANALYSIS OF THE FEASIBILITY AND ECONOMIC IMPLICATIONS OF COMPLIANCE WITH WITH 2306 SPOT 142 L AND PREPARED THE ATTACHED REPORT, WHICH IS PRESENTED TO THE BOARD FOR ITS REVIEW AND ACCEPTANCE.
STAFF WILL PROVIDE THIS REPORT WITH ITS WAIVER REQUEST TO THE TEXAS BOND REVIEW BOARD.
AS A REMINDER, SECTION 142 L BECAME EFFECTIVE SEPTEMBER 1ST, 2002.
THERE ARE SEVERAL REASONS WHY THIS WAIVER IS NECESSARY, INCLUDING THE FACT THAT TDCJ INDENTURES REQUIRE MWBES ELIGIBLE LOANS REQUIREMENTS BY THE MASTER SERVICER, THAT BORROWERS HAVE A MINIMUM 620 FICO SCORE, AND THE INTEREST RATE RISK ASSOCIATED WITH HOLDING BACK A SIGNIFICANT PORTION OF BOND PROCEEDS TO MEET THESE REQUIREMENTS. FURTHER, THE DEPARTMENT CONTINUES TO SERVE THE INTENDED AUDIENCE.
APPROXIMATELY 96 OF THE DEPARTMENT'S BOND LOANS ARE MADE TO BORROWERS BELOW, AT OR BELOW 90% OF THE AREA MEDIAN INCOME, AND WE DO ALLOW FOR FICO SCORES AS LOW AS 620 WITH NO PENALTY TO THE BORROWER.
[00:45:06]
UNDERSERVED BORROWERS IN THE STATE.THAT CONCLUDES MY REMARKS, AND I'LL WELCOME ANY QUESTIONS.
OKAY. THIS IS PART OF OUR OUR LEGISLATIVE CLEAN UP REQUESTS BILL TO FIX THIS.
SO WE DON'T HAVE TO ASK THIS EVERY, EVERY YEAR.
YEAH. BUT THAT IS, THIS IS INCLUDED.
THIS WE DISCUSSED THIS LAST YEAR.
AND I BELIEVE BOBBY CAN PROVIDE MORE COLOR.
BUT, YES, THAT'S GOING TO BE ONE OF OUR QUESTIONS BECAUSE.
OKAY. ANY OTHER MEMBERS HAVE QUESTIONS ON ITEM 11? VERY GOOD. OKAY.
IN THAT CASE, I WILL ENTERTAIN A MOTION ON ITEM 11 OF THE AGENDA.
MR. CHAIRMAN, I MOVE THE BOARD GRANT RESOLUTION NUMBER 25 001 REGARDING THE ANNUAL WAIVER OF SINGLE FAMILY MORTGAGE REVENUE BOND SET ASIDE REQUIREMENTS, ALL AS DESCRIBED, CONDITIONED AND AUTHORIZED IN THE BOARD ACTION, REQUEST RESOLUTION AND ASSOCIATED DOCUMENTS ON THIS ITEM.
SECOND. THANK YOU. MOTION MADE BY MR. THOMAS, SECONDED BY MISS FARIAS.
AYE. ANY OPPOSED? HEARING NONE. MOTION CARRIES.
PRESENTATION, DISCUSSION AND POSSIBLE ACTION REGARDING RESOLUTION NUMBER 25.
004 AUTHORIZING THE ISSUANCE, SALE AND DELIVERY OF A SINGLE FAMILY MORTGAGE REVENUE BONDS OR RESIDENTIAL MORTGAGE REVENUE BONDS IN ONE OR MORE SERIES AND INSTALLMENTS.
APPROVING THE FORM AND SUBSTANCE OF RELATED DOCUMENTS.
AUTHORIZING THE EXECUTION OF DOCUMENTS AND INSTRUMENTS NECESSARY OR CONVENIENT TO CARRY OUT THE PURPOSES OF THIS RESOLUTION, AND CONTAINING OTHER PROVISIONS RELATING TO THE SUBJECT.
JUST A LITTLE BIT OF BACKGROUND ON THIS.
THIS IS OUR WE BEGAN THIS LAST YEAR WHERE WE SOUGHT AND WERE GRANTED A BLANKET APPROVAL FOR ISSUANCE FOR FISCAL YEAR 2024. THIS IS OBVIOUSLY FOR FISCAL YEAR 2025.
WANTED TO GIVE YOU A QUICK BACKGROUND.
RATES HAVE FALLEN OFF FROM RECENT HIGHS.
YET STILL REMAIN NEAR THEIR HIGHEST LEVEL SINCE 2009.
OVERALL, ECONOMIC NUMBERS REMAIN STRONG, WHICH MAY SLOW THE FED'S PACE A LITTLE BIT.
DEMAND FOR MORTGAGE LOANS FUNDED BY THE DEPARTMENT'S BOND ISSUANCE HAVE.
THE BAND HAS SLOWED MODESTLY BUT REMAINS REASONABLY STRONG AS THE RATE DIFFERENTIAL BETWEEN BOND FUNDED LOANS AND TBA OR MARKET RATE LOANS REMAINS FAIRLY WIDE.
WE ACTUALLY ENDED UP DOING A 6040 SPLIT BETWEEN TAX EXEMPT AND TAXABLE.
LOOKING AHEAD, WE ENVISION BUILDING A LARGER MORTGAGE LOAN PIPELINE AHEAD OF ISSUANCE GOING FORWARD AND ISSUING MORE FREQUENTLY IN 2025, IN SMALLER AMOUNTS.
WE ALSO ENVISION ISSUING MORE TAX EXEMPT PAPER TO KEEP OUR RATES AS LOW AS WE CAN, AS IN A PROJECTED FALLING RATE ENVIRONMENT, THE ANNUAL NOT TO EXCEED ISSUANCE APPROVAL WOULD PROVIDE SEVERAL SEVERAL BENEFITS FOR THE DEPARTMENT.
AND CHANGES IN INTEREST RATES AND CHANGES IN MORTGAGE DEMAND.
IT JUST GIVES US THE FLEXIBILITY.
THE 1.1 BILLION REQUEST REPRESENTS THE DEPARTMENT'S EXPECTATION OF FISCAL YEAR 2025 ISSUANCE, PROJECTED AT AROUND 850 MILLION IN TAX EXEMPT. AROUND 150 IN FIXED RATE TAXABLE AND AROUND 100 MILLION IN RECYCLING.
REFUNDING RELATED TAX EXEMPT ISSUANCE.
THE DEPARTMENT WILL CONTINUE TO PROVIDE THE BOARD WITH PRE AND POST ISSUANCE REPORTS.
ISSUANCE PARAMETERS SPECIFIED IN THE RESOLUTION MIRROR THOSE THAT WE HAVE DONE ON RECENT TRANSACTIONS, BUT DO INCLUDE LANGUAGE TO INCLUDE VARIABLE RATE ISSUANCE GOING FORWARD. THIS.
THE DEPARTMENT RECOMMENDS APPROVAL OF THIS RESOLUTION.
THAT CONCLUDES MY PREPARED REMARKS AND I WELCOME ANY QUESTIONS.
OKAY. FIRST OF ALL, I WANT TO KNOW.
LAST MEETING, YOU TOLD US TO EXPECT A 25 POINT RATE CUT AND IT WAS 50.
I WAS HOW CAN YOU EXPLAIN THAT? NO. THAT'S GOOD. 50.
[00:50:01]
I WAS CURIOUS AS TO 1.1 BILLION.IT'S THE SAME AMOUNT AS THE PRIOR YEAR, ISN'T IT? EXPANDING OR WHAT? WHY? KEEPING IT THE SAME LEVEL? YEAH. SO WE ENDED UP, YOU KNOW, WE ASKED FOR THE 1.1 BILLION.
ONE OF THE THINGS THAT WE DO WITH THAT IS MAKE SURE WE DON'T, YOU KNOW, WE DON'T WANT TO.
WE ENDED UP ONLY ISSUING 750 MILLION LAST YEAR.
SO WE WERE WELL UNDER OUR EXPECTATIONS.
AND THAT HAD TO DO WITH A DECREASE IN DEMAND.
THAT'S HAPPENED SINCE SINCE JULY.
GOING FORWARD, I THINK AS WE MAKE ADJUSTMENTS IN THE PROGRAM, AS WE MAKE ADJUSTMENTS AND GIVE OURSELVES SOME MORE FLEXIBILITY IN OUR IN HOW WE DO OUR FINANCINGS AND THE FREQUENCY OF OUR FINANCINGS, WE'LL BE ABLE I THINK WE'LL BE ABLE TO BE AT A, A LOW ENOUGH RATE TO KEEP OUR DEMAND UP.
SO I THINK WE'RE PROBABLY GOING TO BE LOOKING AT AROUND A BILLION FOR 2025.
SO YOU HAVE INTRODUCED THE AUTHORIZATION OF VARIABLE RATE BONDS.
CORRECT. I ASSUME THAT EVERYTHING VARIABLE IS GOING TO BE SWAPPED TO EFFECTIVELY FIX SOMETHING THAT.
ABSOLUTELY WE DON'T WE DON'T CARE TO TAKE ON VARIABLE RATE DEBT.
WHAT WE ARE SEEING IN THE MARKET, THOUGH, IS THAT YOU CAN ISSUE VARIABLE RATE DEBT, SWAP THAT OUT TO A FIXED RATE AND ACTUALLY ACHIEVE SAVINGS VERSUS WHAT YOU COULD DO WITH A STRAIGHT FIXED WITH A STRAIGHT FIXED RATE TAX EXEMPT DEAL.
AND SO WE WILL BE LOOKING AT THAT.
ADMINISTRATIVELY IT'S VERY CHALLENGING.
BUT I'M ALSO LOOKING AT THIS AND SAYING I WANT EVERY TOOL IN THE TOOLBOX.
AND SO WE ARE BRINGING THIS BACK IN OUR POLICY.
WE WILL, WE WILL WE WILL SWAP EVERYTHING INTO FIXED RATE.
OKAY. SO THAT'S NOT GOING TO HAPPEN.
WE DON'T HAVE TO FIRE YOU OR PEOPLE ON THE RECORD OKAY.
ALL RIGHT. EVERYONE HEARD THAT, RIGHT? OKAY. MR. CHAIRMAN JUST A QUICK QUESTION.
SO IS THE STRATEGY SHIFTS TO DOING MORE FREQUENT ISSUANCES.
HOW ARE YOU THINKING THROUGH OR ACCOUNTING FOR LIKE THE ANCILLARY COSTS, LIKE ADMINISTRATIVE FEES, PROFESSIONAL FEES SUCH THAT GO WITH MORE DEALS? YEAH. YOU KNOW, THE FIX, THE FIXED DOLLARS ON DEALS ARE THE MINIMAL PART.
RIGHT. THE FIXED, THE FIXED COSTS ASSOCIATED WITH ISSUANCE.
MOST OF IT'S BASED ON PERCENTAGE OF NUMBER OF BONDS.
BUT THOSE ARE NOT NOT THE BIGGEST PART OF THE OF THE EQUATION, AS YOU KNOW.
AND SO WE, WE WOULD PROBABLY HAVE A LITTLE BIT MORE ISSUANCE EXPENSE, BUT IT'S RELATED TO JUST, YOU KNOW, COMING TO MARKET AND HAVING THOSE, YOU KNOW, THE, THE FEES, BUT EVERYTHING FROM UNDERWRITING FEES TO FAA FEES TO RATING AGENCY FEES ARE ALL ALL DRIVEN BY THE AMOUNT OF BONDS THAT WE'RE ISSUING ON ANY GIVEN DEAL.
ALL RIGHT. AND I WOULD ENCOURAGE, YOU KNOW, I THINK THE CHAIRMAN'S TALKED ABOUT THIS BEFORE, BUT TO THE EXTENT THAT WE'RE DOING MORE FREQUENT TRANSACTIONS AND THEY'RE ALL VERY SIMILAR TRANSACTIONS TO SORT OF SEND THE MESSAGE EARLY IN THE PROCESS THAT, YOU KNOW, WE DON'T WANT TO REINVENT THE WHEEL EVERY TIME.
WE SHOULD BENEFIT FROM DOCUMENT TEMPLATES AND THINGS LIKE THAT.
TICKET FEES DOWN AS FAR AS WE CAN.
ANY OTHER QUESTIONS FOR MR. FLETCHER? IF NOT, I'LL ENTERTAIN A MOTION ON ITEM 12 OF THE AGENDA.
MR. CHAIRMAN, I MOVE THE BOARD GRANT RESOLUTION NUMBER 25004 REGARDING THE ISSUANCE, SALE AND DELIVERY OF TDHCA SINGLE FAMILY MORTGAGE REVENUE BONDS, ALL AS DESCRIBED, CONDITIONED AND AUTHORIZED IN THE BOARD ACTION, REQUEST RESOLUTION AND ASSOCIATED DOCUMENTS ON THIS ITEM.
ALL RIGHT. MOTION MADE BY MR. THOMAS, SECONDED BY MR. HARPER. ALL THOSE IN FAVOR SAY AYE.
AYE. ANY OPPOSED? HEARING NONE. MOTION CARRIES.
MOVING ON TO ITEM 13 OF THE AGENDA PRESENTATION, DISCUSSION AND POSSIBLE ACTION REGARDING A WAIVER OF TEN TEC SECTION 11.101 B1A7 OF THE QUALIFIED ALLOCATION PLAN REGARDING TO THE PERCENTAGE OF EFFICIENCY AND OR ONE BEDROOM UNITS FOR OAK HILL
[00:55:06]
LOFTS. MISS MORALES.GOOD MORNING. TERESA MORALES, DIRECTOR OF MULTIFAMILY BONDS.
OAK HILL LOFTS PROPOSES THE NEW CONSTRUCTION OF 90 UNITS IN AUSTIN.
OF THE 90 UNITS, 50 WILL BE ONE BEDROOMS, WHICH COMPRISES 55.5% OF THE TOTAL UNIT COUNT.
THE REMAINING UNITS INCLUDE 32 BEDROOMS AND TEN THREE BEDROOMS. LAST YEAR, THE APPLICANT SUBMITTED A 4% HOUSING TAX CREDIT APPLICATION FOR THIS DEVELOPMENT THAT WHILE THE UNIT MIX WAS SLIGHTLY DIFFERENT, IT COMPLIED WITH THE SHAPE.
INSTEAD OF 90 UNITS, THE APPLICATION REFLECTED 82 TOTAL UNITS AND INCLUDED 24 EFFICIENCY UNITS THAT REPRESENTED 29% OF THE TOTAL. THE REMAINING UNITS WERE TWO BEDROOMS, ACCORDING TO THE APPLICANT.
THE ORIGINAL DESIGN CONTEMPLATED OFF SITE MODULAR CONSTRUCTION, BUT DUE TO ISSUES WITH MODULAR SUPPLIERS, THE APPLICANT SWITCHED COURSE TO UTILIZE TRADITIONAL CONSTRUCTION AND DECIDED TO RECONFIGURE THE PROJECT.
THEY STARTED THE PROCESS WITH A DIFFERENT BOND ISSUER, AND SUBSEQUENTLY MADE A SUBMISSION TO THE BOND REVIEW BOARD LAST OCTOBER AND PARTICIPATED IN THE BOND LOTTERY, WHERE THE APPLICATION HAS EFFECTIVELY BEEN IN LINE FOR A YEAR NOW GIVEN THE OVERSUBSCRIPTION.
STAFF DOES NOT BELIEVE THAT THE REQUEST AND CIRCUMSTANCES FIT WITHIN THE PROVISION OF THE WAIVER RULE, THAT THIS WAS NOT WITHIN THE CONTROL OF THE APPLICANT, AND RECOMMENDS THAT THE WAIVER BE DENIED.
SO THIS IS ASKING FOR 56%, 55.5, 55.5%.
BUT NOW THIS IS THAT APPLICATION.
IT WAS SUBMITTED LAST YEAR, BUT IT WAS ULTIMATELY WITHDRAWN.
SO IT DIDN'T MOVE MOVE FORWARD.
OKAY. AND THIS IS NOT A ADAPTIVE REUSE OR REHAB.
CORRECT. SO IT'S NOT LIKE THEY'RE LIMITED IN HOW THEY PUT TOGETHER.
THEY'RE, YOU KNOW, MAKING DO WITH WHAT WAS WHAT WAS THERE.
I GUESS THERE ARE REPRESENTATIVES OF THE DEVELOPER THAT WOULD LIKE TO SAY THEIR PEACE SIGN, SIGN, SIGN IN, AND HI.
GOOD MORNING. MY NAME IS GREG STAHL.
I'M HERE REPRESENTING BROADWAY HOMES AND ROSE EQUITIES ON OAK HILL LOFTS.
OUR TEAM'S FIRST LIGHT TECH DEVELOPMENT HERE IN TEXAS.
THE 2024 HUD FAIR MARKET RENTS ARE OVER $800 A UNIT, HIGHER THAN THE 60% RENT RESTRICTED UNITS, WHICH IS THE PRIMARY REASON THAT SO LITTLE AFFORDABLE HOUSING HAS BEEN BUILT ANYWHERE IN DISTRICT EIGHT.
OUR ORIGINAL BUSINESS PLAN PROPOSED USING IN A NEW DEVELOPMENT TYPE OFF SITE MODEL, MODULAR CONSTRUCTION, WHICH WOULD HAVE BEEN THE FIRST LIGHT TECH DEVELOPMENT IN TEXAS TO TRY THIS. WE PURCHASED THE SITE IN 2021, AND THE DEVELOPMENT PLANS WERE INFLEXIBLE DUE TO THE LIMITATIONS OF MODULAR DEVELOPMENT, BUT STILL COMPATIBLE WITH THE SHIP.
THIS WAS PRESENTED TO TDA AND OUR COMPLIANCE.
2023 APPLICATION, BUT IS CLEARLY LESS THAN IDEAL FOR OUR COMMUNITY.
56% HIGHER PER UNIT THAN OUR 2023 APPLICATION.
[01:00:10]
SINCE WE WERE NOTIFIED BY STAFF LAST WEEK OF THE RECOMMENDATION TO DENY THIS WAIVER REQUEST, WE'VE BEEN WORKING AGGRESSIVELY WITH OUR TEAMS, WITH OUR DESIGN TEAMS TO TRY AND RECONFIGURE OUR PLANS.WE'VE IDENTIFIED A WAY TO CHANGE A21 BEDROOM UNITS PER FLOOR TO TWO BEDROOM UNITS, WHICH WOULD RESULT IN A PHASE ONE UNIT MIX OF 31 BEDROOM, 52 BED, THREE AND TEN THREE BED UNITS.
BUT AS OF TODAY, IF THE IF THE BOARD DOES NOT ACCEPT OUR CURRENT WAIVER REQUEST, WE RESPECTFULLY ASK THAT WE BE ABLE TO MODIFY OUR APPLICATION TO ACCOMMODATE THE UPDATED PLANS, WHICH WOULD HAVE A TOTAL OF 3,033% ONE BEDROOMS. THIS PLAN WOULD STILL BE OVER THE CURRENT SHAPE, BUT IS IN LINE WITH THE PROPOSED CHANGES OF 2025.
THANKS IN ADVANCE AND WE'LL BE HAPPY TO ANSWER ANY QUESTIONS.
OKAY, SO YOU'RE WORKING ON READJUSTING THE PLANS TILL TO GET TO 33%? I MEAN, THAT'S CORRECT.
SO DO WE HAVE TO COULD WE TABLE THIS FOR NOW, OR IS THERE SOME OTHER TIMING ISSUE THAT GETS TRIGGERED? WELL, AGAIN, WE'VE ONLY HAD A WEEK SINCE WE WERE NOTIFIED THAT THAT'S ALMOST MORE TO IT.
WELL, YEAH, I GUESS PART TWO, BUT PART TO STAFF FOR ME.
RIGHT. SO THAT'S WHAT I'M SAYING.
SO WOULD THIS BE MORE LOGICAL TO TABLE FOR ANOTHER MEETING, OR DO YOU WANT THE LEARNED CONSULTANTS ROBBIE MEYER I'M WITH AAC'S ADVANTAGE.
I'M REPRESENTING THE APPLICANT.
WHAT? I WOULD ASK IF WE COULD GET A YES, THAT THAT WOULD WORK.
THEN HE COULD MOVE FORWARD WITH REVISING THE PLANS AND AND MOVE MOVE FORWARD WITH IT.
IF YOU'RE NOT GOING TO APPROVE THE WAIVER EITHER WAY, THEN IT'S KIND OF A DEAD DEAL.
IF YOU'RE NOT IF YOU'RE NOT ACCEPTABLE TO THAT, THEN MRS. MEYER AND MR. SCHOLL, WHY IS 3% ON SINGLE FAMILY? I MEAN, YOU WENT FROM 56 TO 3% OVER.
NOW IS WHAT YOU'RE ASKING FOR HERE.
WHY? I MEAN, IS IT REALLY THAT MUCH MORE THAN 3% ON 50% TO 33? I'M WITH YOU IN THE STANDARD IS 30.
SO WHY NOT 30? THAT WOULD THAT WOULD JUST RESULT IN A REVISION OF OUR OF OUR FLOOR PLANS.
AND WE DON'T HAVE TIME GIVEN OUR CURRENT EXISTING BOND BOND RESERVATION.
WE ABSOLUTELY HAVE TO CLOSE IN JANUARY AND WE DON'T HAVE ENOUGH TIME TO BASICALLY CREATE A NEW FLOOR PLAN THAT WOULD INTRODUCE NEW NEW UNITS. SO OUR ONLY SOLUTION AT THAT TIME, OR TEMPORARY SOLUTION WAS TO BASICALLY CONVERT SOME OF THE USE OF THE EXISTING FLOOR PLAN, BUT CONVERT SOME OF THE ONE BEDROOMS INTO TWO BEDROOM UNITS. THE MAIN THING IS THE BUILDING CONFIGURATION NOT HAVING TO CHANGE THE BUILDING ITSELF.
THANK YOU. OKAY. AND WE ARE GOING TO 35% FOR 2025 RIGHT.
YEAH. SO THAT WOULD COMPLY WITH YOU KNOW GOING A FEW MONTHS.
YEAH. IT WOULD, IT WOULD IT WOULD WORK.
SO I GUESS YOU COULD APPROVE A WAIVER OF UP TO 34%, RIGHT? I SAY NO, I'M BEING I'M MY LEFT EAR IS TELLING ME NO OR WE CAN'T RIGHT NOW BECAUSE IT WASN'T PRESENTED WELL.
WHAT YOU'RE ASKING FOR, THEN, IS A WAIVER OF A RULE FOR SOMETHING THAT HAS NOT BEEN SUBMITTED, AND THAT I ACTUALLY STILL HAVEN'T HEARD OF SATISFYING THE WAIVER RULE ITSELF ABOUT WHAT EXACTLY WAS OUT OF YOUR CONTROL WHEN SUBMITTING THIS APPLICATION TO BEGIN WITH THAT IT CLEARLY VIOLATED THIS RULE.
HANG ON. ROBBIE. MR. MARCHANT, DID YOU MAKE A MOTION WHEN YOU'RE READY TO ACCEPT.
MR. CHAIRMAN. THE MOTION TO TABLE TO DENY.
THERE'S TOO MUCH IN THERE JUST TO TRY THAT.
THIS IS NOT AN OPINION I'VE HAD ALL THIS TIME.
BUT YOU'LL HAVE TO RECOGNIZE THAT MUCH.
DO ANY OTHER BOARD MEMBERS HAVE COMMENTS?
[01:05:01]
SO I HAVE A DIFFERENT PERSPECTIVE ON THAT.THEY OBVIOUSLY MADE A MISTAKE BY COMING IN FOR 56.
I HAVE DONE LOTS AND LOTS OF MODULAR CONSTRUCTION AND I KNOW WHAT HAPPENS.
AND THEN YOU LOOK AT IT AND GO, I COULD JUST BUILD THIS STANDARD FOR THE SAME PRICE.
I AM WILLING TO PUT A RESOLUTION THAT IF IT COMES IN AT 33% AND MEETS THE STANDARDS AND THE OBJECTIVES OF STAFF, THAT IT CAN MOVE FORWARD, BUT THEY WOULD THAT WOULD BE SUBJECT TO STAFF'S REVIEW.
STAFF'S IT HAS TO BE COMPLIANT WITH EVERYTHING ELSE OTHER THAN THE 3%.
AND I WOULD LOVE DISCUSSION FROM THE BOARD MEMBERS IF YOU BUT I THAT'S MY POSITION.
WELL I CAN LIVE WITH THAT TOO.
BUT ARE WE ALLOWED TO JUST WOULD IT BE MORE SIMPLY TABLE OR.
WHAT THE APPLICANT IS SEEKING IS A IS A WAIVER OF THIS RULE.
YEAH. BUT WE'RE NOT GOING TO WAIVE IT AT THIS.
I WOULD BET YOU I MY SENSE IS THAT WE WOULD I WOULD SUBMIT THAT THIS LENDS ITSELF MORE TO TABLING THIS, TO ALLOW THEM TO BRING WHATEVER IT IS THEY'RE GOING TO BRING IN FRONT OF THIS BOARD AND ASK FOR A WAIVER AT THAT TIME.
BUT WOULD ANYONE CARE TO MAKE A MOTION TO TABLE THIS TO GET THE REVIEW REVISED PLANS AT 33%.
AND BEFORE WE GO TO THAT, CHAIRMAN COUNCIL 30 DAYS IS 30 DAYS, RIGHT.
AND IF YOU'RE TRYING TO CLOSE BY DECEMBER, LIFE IS TOUGH.
SO THEY'VE COME TO ASK FOR 56.
I'M MAKING A SUGGESTION THAT WE CHANGE THAT TO 33.
THEY HAVE MADE A POSITION I WILL NOT ACCEPT 56.
THAT'S NOT THAT'S NOT ACCEPTABLE.
I WOULD ACCEPT A 10% VARIANCE IN SIGHT.
WE WOULD DENY THE FIRST ONE IS MODIFIED BEFORE THIS BOARD.
WHAT? WHAT IS THE LEGAL QUESTION FOR ME? I DON'T KNOW. CAN WE MAKE THAT MOTION? I DON'T KNOW, THAT WOULD BE DIFFERENT.
THEY MADE A SUGGESTION FOR 56.
I THINK THIS BOARD IS UNANIMOUS THAT 56 IS NOT COMPLIANT.
THEY HAVE ASKED FOR 33 AND THE SHORT NOTICE.
THEY HAVE ONE REPRESENTATIVE OR ONE BOARD MEMBER THAT WOULD APPROVE THAT.
SO IT'S ESSENTIALLY WAIVING THE 30%.
THAT'S CORRECT. TO PUT IT UNDER THE 35% THAT'S IN THE PENDING SHAPE.
I'M MAKING A MOTION THAT THERE'S A 33 POINTS.
YES. AND I WOULD SECOND THAT MOTION.
CAN I ACCEPT THAT MOTION? IF SO, I WILL.
I'LL RECOGNIZE MR. HARPER FOR A MOTION.
OKAY. I MOVE THE BOARD, GRANT THE REQUESTED WAIVER OF TEN TAC SECTION 11.1 01B OF THE QUALIFICATION ACTION PLAN REGARDING THE PERCENTAGE OF EFFICIENCY FOR ONE BIDDER FOR LOFT HILL LOFT APARTMENTS AT THE MAXIMUM AMOUNT OF 33% FOR THE REASONS DESCRIBED IN THE BOARD ACTION REQUEST AND ASSOCIATED DOCUMENTS IN THIS ITEM.
SECOND MOTION MADE BY MISS FARIAS.
SECONDED BY MR. HARPER. SECONDED BY MISS FARIAS.
CAN YOU ALL LIVE WITH THAT ONE THING? OUR CURRENT PLANS HAVE IT'S ACTUALLY 33.3% OF THE UNITS ARE OKAY.
OH, NO. OKAY. NO. THAT'S GOOD.
NO, NO, THAT'S THAT'S WE'RE THAT'S THAT'S TECHNICALITY.
WILL YOU AMEND YOUR MOTION TO 34%? IT'S 30 OUT OF 90.
THE MATH IS I MAKE THE MOTION FOR NO MORE THAN 34 POINTS.
AYE. ANY OPPOSED? OPPOSED. OPPOSED.
MR. VASQUEZ, COULD I, COULD I? CHAIRMAN. LET ME MAKE MY COMMENTS THAT I WAS GOING TO MAKE.
I ACTUALLY STEPPED UP HERE TO THE MIC TO ACTUALLY ANSWER YOUR QUESTION.
FOR THIS DEAL, IT ACTUALLY STARTED IN 2021.
IT REALLY MAKES A BETTER 9% DEAL.
[01:10:01]
BUT IT HASN'T BEEN COMPETITIVE IN PAST YEARS.SO HE RETOOLED THE APPLICATION TO GO AS A 4% TRANSACTION.
HE SINCE HAS ACQUIRED ADDITIONAL LAND, BUT THIS ACTUALLY STARTED IN 2021.
SINCE HE'S HAD TO REORGANIZE IT, HE'S STILL AT 50% OF OF 50 OF 50% OF AREA MEDIAN INCOME.
STILL A VERY GOOD PUBLIC SERVICE, AND I THINK THAT IS A GOOD PUBLIC SERVICE FOR ALL TO UNDERSTAND.
YOU DON'T GET THAT MANY BOND TRANSACTIONS THAT HAVE THAT.
SO IF THAT CAN SWAY ONE OF YOU THAT ARE OPPOSING IT, I KNOW IT COULD HAVE BEEN OUT OF HIS CONTROL TO SUBMIT THE APPLICATION. I DON'T DISAGREE WITH THAT, BUT THERE IS GOOD PUBLIC PURPOSE BEHIND THIS DEVELOPMENT.
BUT MISS MEYER, YOU WHEN YOU SAW THAT THE UNIT MIX WAS GOING TO CHANGE TO BE WAY OUT OF SPEC, YOU DIDN'T STOP HIM AND SAY, THIS WON'T WORK.
DID WE DISCUSS IT? YES. AND I ALSO TOLD HIM THAT WE NEEDED THE WAIVER AND HE WAS GOING TO HAVE TO REQUEST THAT.
AND THAT WAS GOING TO BE A HURDLE.
I THINK HE WILL AGREE TO THAT.
THAT'S WHY HE SUBMITTED THE WAIVER.
BUT HIS PLANS WERE ALREADY IN EFFECT.
THEY WERE ALREADY MOVING THROUGH THE CITY OF AUSTIN.
I MEAN, THAT WAS ALREADY I MEAN, IT WAS DOWN THE ROAD.
HE'S ALREADY SPENDING MONEY WITH THE CITY OF AUSTIN AND PERMITTING AND ALL OF THAT.
THAT'S THAT'S THE REASON WHY THEY DIDN'T CHANGE.
THE PLANS ARE IN THE CITY OF AUSTIN AS THEY ARE THIS CHANGE THAT HE'S GOT TO MAKE.
HE'S GOT TO GO BACK AND MAKE THAT CHANGE WITHIN THE CITY OF AUSTIN.
BUT AND THAT'S WHY WE WERE TRYING NOT TO CHANGE THE BUILDING CONSTRUCTION, THE THAT STRUCTURE.
HE'S JUST GOT TO SWITCH TWO BEDROOMS AND ONE BEDROOMS WITHIN THE STRUCTURE OF THE BUILDING.
SO THE CITY PART OF PART OF MR. ECHOLS ISSUE OF BEING OUT OF THE THE OWNER'S OR THE APPLICANT'S CONTROL.
YOU KNOW HOW THE CITY OF AUSTIN IS AND MOVING THROUGH THE PERMITTING PLAN? IT DOES TAKE TIME.
SO HE'S HAD THAT IN THE CITY OF AUSTIN, AND STAFF CAN CALL AND FIND THAT OUT.
BUT I JUST WANT YOU TO KNOW THERE IS A GOOD PUBLIC PURPOSE BEHIND.
WE UNDERSTAND THAT, BUT IT DOESN'T COMPLY BY FAR AS WAS PRESENTED TO US.
AND DO WE HAVE, MR. MARSHALL THAT YOU HAVE? I'M JUST A CONSULTANT.
CONSULTANT? I'M NOT IN THE DEAL AT ALL.
I'M JUST. I'M. NO, I'M NOT A PARTNER.
I'M JUST A CONSULTANT FOR THE DEAL.
AND YOU ADVISED ME NOT TO DO THIS.
I DID NOT SAY. I ADVISED HIM NOT TO DO IT.
I JUST SAID HE WAS GOING TO HAVE TO HAVE A WAIVER BECAUSE WE HAVE A RULE IN PLACE.
AND. BUT AGAIN, THE PLANS WERE ALREADY IN PROCESS.
LET ME JUST REITERATE ONE MORE PIECE OF INFORMATION FOR THIS SIDE OF THE DAIS.
I THINK HE WAS WAITING FOR THE THE SHAPE AS IT STANDS TODAY SAYS WE CAN'T HAVE MORE THAN 30% ONE BEDROOM OR SMALLER AS OF DECEMBER 1ST UNLESS THE ASSUMING THE GOVERNOR APPROVES IT.
THE SHAPE IS GOING TO NOW SAY 35%.
SO IF THEY BROUGHT THIS DEAL AT THE 30 UNITS, 33.3% UNITS AS OF JANUARY 1ST, IT WOULD COMPLY.
BUT WHEN THEY SUBMITTED THEIR ORIGINAL PLAN, WE WERE UNDER THE EXISTING SHAPE AND THE NEW RULE.
YES. THAT'S WHY THEY'D BE COMING FOR A WAIVER.
AND THEN IN YOUR NEW RECONFIGURATION.
HAVE YOU MAXIMIZED THE NUMBER OF UNITS, ONE BEDROOM UNITS YOU CAN CONVERT TO SO THAT YOU CAN GET DOWN TO 30%? OR, YOU KNOW, WE COULD WE COULD CREATE ADDITIONAL FLOOR PLANS THAT THAT WOULD HAVE AN OPPORTUNITY TO CHANGE ADDITIONAL UNITS AND BASICALLY RECONFIGURE THE UNIT MIX AGAIN AND POSSIBLY GET UNDERNEATH 30%.
[01:15:02]
PLANS YET. SO OUR CURRENT PLANS HAVE JUST CONVERTED THE EXISTING FLOOR PLANS, WHICH IS THE SAME THE SAME FLOOR PLAN ON ALL LEVELS.SO THANKFULLY, MY COLLEAGUE IS ASKING, ARE ALL OF THE ONE BEDROOMS THAT YOU'VE CONVERTED TO GET TO 33.3%? DID YOU TAKE ALL OF THOSE TO GET TO 33.1%.
DID YOU TAKE ALL THE ALL THE ONES TO TURN TO TWOS THAT ARE POSSIBLE? ON THE EXISTING FLOOR PLAN? YES WE DID. THEY'RE STACKED.
YOU'VE ALREADY DONE, GIVEN THE GIVEN THE CURRENT BOUNDARIES OF THE FOOTPRINT OF THE BUILDING.
SO IF WE'RE DEADLOCKED, THE FIRST MOTION FAILED.
BUT THEN IF WE DON'T CAN'T MAKE ANY MOTION TO DENY, WELL, ANOTHER MOTION WOULD BE CALLED FOR.
WE WISH THAT WE WOULD HAVE HAD A DIALOG WITH THE CITY PLANNING IN ADVANCE OF LAST WEEK LAST WEEK.
IT'S. BUT WHENEVER YOU INCREASE FROM THE ORIGINALLY COMPLIANT TO THE NON-COMPLIANT, THAT'S WHEN ALL THE RED FLAGS SHOULD HAVE GONE UP ON Y'ALL'S SIDE.
UNDERSTOOD. AND WE UNDERSTAND THAT YOU'RE WILLING TO FIX IT AT THIS POINT, BUT.
IT'S THE BOARD IS DEADLOCKED ON WHETHER TO GRANT YOU THE OPPORTUNITY TO FIX IT.
ANYBODY? ANYBODY WILLING TO MOVE? SO IF THE MOAT.
IF WE'RE HARD DEADLOCKED, WE CAN'T APPROVE THE MOTION TO ALLOW THE WAIVER. THE WAIVER IS NOT GRANTED BY DEFAULT.
MR. CHAIRMAN, I WOULD BE WILLING TO VOTE FOR A MOTION TO TABLE.
BUT THEY HAVE SAID THAT THAT MOTION WOULD NOT GIVE THEM WHAT THEY NEEDED.
IS THAT CORRECT? JUST IT'S POSSIBLE JUST GIVEN THE TIMING CONSTRAINTS.
GOOD. I'M TRYING TO REMEMBER IF WE'VE EVER BEEN.
ARE YOU ALL NOT CHANGING YOUR MOTION ON HIS ON THIS ONE? NO. I WOULD MOVE THAT.
I WOULD AGREE WITH BOARD MEMBER MARCHAND.
I'D BE WILLING TO SUPPORT A TABLE AND LET HIM COME BACK.
AND LET'S SEE WHAT HAPPENS. IF YOU ALL CAN WORK ON TIMING AND EVERYTHING LIKE THAT.
MR. MERCHANT, WOULD YOU MAKE THAT MOTION, PLEASE? THE MOTION HERE ON THE.
WELL, JUST BASICALLY SAY WE'RE GOING TO TABLE THE.
I MADE THIS THE BOARD TABLE, THE REQUESTED WAIVER OF SECTION 11 101 B OF THE QUALIFIED ALLOCATION PLAN RELATING TO THE PERCENTAGE OF EFFICIENCY AND OR ONE BEDROOM UNITS FOR OAK HILLS, LOST ALL OF THE REASONS DESCRIBED IN THE BOARD ACTION REQUEST AND ASSOCIATED DOCUMENTS.
OKAY. THE MOTION. MOTION TABLED BY MR. MARCHANT. SECONDED BY MR. THOMAS. ALL THOSE IN FAVOR SAY AYE.
I'M SORRY. IT'S THE BEST WE CAN DO FOR YOU RIGHT NOW.
THANK YOU FOR YOUR TIME. OKAY.
ITEM 14. PRESENTATION, DISCUSSION AND POSSIBLE ACTION ON INDUCEMENT.
[01:20:09]
AUTHORITY. MISS MORALES.TERESA MORALES, DIRECTOR OF MULTIFAMILY BONDS.
THE ADOPTION OF AN INDUCEMENT RESOLUTION IS THE FIRST STEP IN THE PROCESS.
IT ALLOWS US TO FILE FOR VOLUME CAP WITH THE BOND REVIEW BOARD AND GET INTO THE FULL APPLICATION PROCESS, WHERE WE DO MORE THOROUGH REVIEWS, UNDERWRITING AND VETTING OF THE BOND STRUCTURE.
ONCE ALL OF THAT HAPPENS, REQUESTING CONSIDERATION OF THE ACTUAL BOND ISSUANCE.
GENERAL DESCRIPTIONS OF EACH OF THE DEVELOPMENTS ARE INCLUDED IN THE WRITE UP, BUT THE MAJORITY ARE NEW CONSTRUCTION LOCATED IN DALLAS, WITH ANOTHER ONE LOCATED IN HOUSTON AND ANOTHER IN WILLMAR THAT WOULD YIELD JUST OVER 1100 UNITS IN TOTAL.
THESE PROJECTS ARE REQUESTING APPROXIMATELY $223 MILLION IN BOND VOLUME CAP, WHICH EXCEEDS THE AMOUNT THAT STAFF EXPECTS TO BE AVAILABLE IN THE TDHCA SET ASIDE FOR 2025.
OKAY, GREAT. SO THESE ARE JUST OUR STANDARD 4% WAITING LIST.
OKAY. DO BOARD MEMBERS HAVE QUESTIONS FOR MISS MORALES ON THIS ITEM? HEARING NONE. I'LL ENTERTAIN A MOTION ON THE ITEM 14 OF THE AGENDA.
MR. CHAIRMAN, I MOVE THE BOARD, APPROVE INDUCEMENT RESOLUTION NUMBER 25, DASH 006 AND PROCEED WITH THE APPLICATION SUBMISSIONS TO THE BRB FOR POSSIBLE RECEIPT OF STATE VOLUME CAP ISSUANCE FOR THE PRE-APPLICATIONS DESCRIBED SCRIBD AND IT'S CONDITIONED AND AUTHORIZED IN THE BOARD ACTION, REQUEST RESOLUTION AND ASSOCIATED DOCUMENTS ON THIS ITEM.
SECOND MOTION MADE BY MISS FARIA, SECONDED BY MR. HARPER. ALL THOSE IN FAVOR SAY AYE.
AYE. ANY OPPOSED? HEARING NONE. MOTION CARRIES.
PRESENTATION, DISCUSSION AND POSSIBLE ACTION ON INDUCEMENT.
RESOLUTION NUMBER 25, DASH 010 FOR MULTIFAMILY HOUSING REVENUE BONDS OR NOTES REGARDING AUTHORIZATION FOR FILING APPLICATIONS TO BE ADDED TO THE DEPARTMENT'S WAITING LIST FOR PRIVATE ACTIVITY BOND AUTHORITY AND OR SUBMITTED FOR TRADITIONAL CARRY FORWARD FOR BRANIFF LOFTS.
WHERE IS HE? OKAY, LET'S MISS MORALES.
WHAT'S NEW ON THIS? THIS AGENDA ITEM INCLUDES CONSIDERATION OF AN INDUCEMENT RESOLUTION FOR BRANIFF LOFTS, WHICH IS A PROPOSED SUPPORTIVE HOUSING DEVELOPMENT IN DALLAS TO INCLUDE 48 UNITS.
STAFF RECOMMENDS ADOPTION OF RESOLUTION NUMBER 25010 IN THE AMOUNT OF 20 MILLION.
OKAY, SO THIS STRUCTURE SHOULD BE ABLE TO MEET THE THEIR FINANCING STACK AND GET DONE IF THIS IS APPROVED SUBJECT TO DEPARTMENT UNDERWRITING AND REVIEW.
BUT HAVEN'T WE KIND OF REVIEWED IT ONCE OR TWICE ALREADY? NOT FROM THE BOND SIDE.
BUT THIS IS JUST AN INDUCEMENT.
IT GETS A PATH FORWARD AND SUBJECT TO ALL THE OTHER UNDERWRITING.
CORRECT. AND THE WAY THAT IT WOULD BE ADDING TO THE WAITING LIST AS WELL.
MR. MARCHANT, I RECOGNIZE YOU FOR A MOTION FOR RESOLUTION NUMBER 25, DASH 010.
AND TO PROCEED WITH THE APPLICATION SUBMISSIONS TO THE BRP.
POSSIBLE RECEIPT OF STATE LOTTERY ISSUES FOR LOSS AT ALL AS DESCRIBED CONDITION AND AUTHORIZED BOARD ACTS. REQUEST RESOLUTION AND ASSOCIATED DOCUMENTS ON THIS ITEM.
SECOND. MOTION MADE BY MR. MARCHANT, SECONDED BY MR. HARPER. ALL THOSE IN FAVOR SAY AYE.
[01:25:02]
AYE. ANY OPPOSED? HEARING NONE. MOTION CARRIES AND PERSISTENCE PAYS.ITEM 16 OF THE AGENDA PRESENTATION, DISCUSSION AND POSSIBLE ACTION ON INDUCEMENT.
RESOLUTION NUMBER 2507 FOR MULTIFAMILY HOUSING REVENUE BONDS REGARDING AUTHORIZATION FOR FILING AN APPLICATION FOR PRIVATE ACTIVITY BOND AUTHORITY FOR FIJI LOFTS.
THE OWNER HAS REQUESTED THE DEPARTMENT ISSUE ADDITIONAL TAX EXEMPT FINANCING TO OFFSET THE INCREASED COSTS AND ALLOW THE PROJECT TO MEET THE 50% TEST, WHICH I'LL GO INTO DETAILS ABOUT THAT IN A BIT.
FIJI LOFTS WAS A NEW CONSTRUCTION DEVELOPMENT LOCATED IN DALLAS THAT CLOSED IN DECEMBER OF 2021.
THE PROJECT IS COMPRISED OF TWO BUILDINGS WITH FOUR FLOORS EACH, AND INCLUDED 174 TOTAL UNITS.
AFTER CLOSING, THE INTENT WAS ALWAYS TO BUILD 204 UNITS, BUT AS THE PROJECT WENT THROUGH THE PERMITTING PROCESS WITH THE CITY, THERE WAS A TECHNICAL ISSUE THAT WAS DISCOVERED WITH THE ZONING REGULATION THAT COULD NOT GET RESOLVED PRIOR TO THE EXPIRATION OF THE BOND RESERVATION AND CLOSING IN DECEMBER OF 2022.
THE DEPARTMENT'S GOVERNING BOARD APPROVED A MATERIAL AMENDMENT TO INCREASE THE TOTAL NUMBER OF UNITS FROM 174 TO 204 BY ADDING A FLOOR TO ONE OF THOSE BUILDINGS.
IN ADDITION TO THE INCREASE IN UNITS, THERE HAVE BEEN COST INCREASES DURING CONSTRUCTION SUCH THAT THE APPLICANT IS CONCERNED THAT THE PROJECT MAY NOT MEET WHAT WE CALL THE 50% TEST.
A PROJECT IS ELIGIBLE FOR THE 4% HOUSING TAX CREDIT, SO LONG AS AT LEAST 50% OF THE AGGREGATE BASIS OF THE BUILDING COMPRISING THE PROJECT, INCLUDING THE LAND ON WHICH THE THE BUILDING IS LOCATED, IS FINANCED WITH TAX EXEMPT BONDS.
IT'S MORE OF AN ACCOUNTING FUNCTION.
THE AGGREGATE BASIS OF A BUILDING INCLUDES DEPRECIABLE BUILDING COSTS PLUS LAND.
THERE ARE CERTAIN COSTS THAT ARE INCLUDED IN THE CALCULATION.
THE DEPARTMENT'S UNDERWRITING ON THE FRONT END AT APPLICATION INCLUDES A 50% TEST CALCULATION, BUT THIS IS PRELIMINARY AND BASED ON WHAT AN APPLICANT BELIEVES THOSE COSTS WILL BE.
ON THE BACK END AT COST CERTIFICATION.
WHEN THE PROJECT IS COMPLETE, WE RECEIVE A REPORT FROM THE CPA THAT PROVIDES THE FINAL CALCULATION ON WHAT THE COSTS ACTUALLY WERE, AND CATEGORIZES THOSE COSTS APPROPRIATELY.
THE LAND COST WAS 1.7 MILLION, BRINGING THE AGGREGATE BASIS TO APPROXIMATELY 54 MILLION.
USING THESE NUMBERS AND STICKING WITH THE ORIGINAL BOND AMOUNT OF 23.8 MILLION, THE 50% TEST CALCULATION WOULD BE 44%. A SUPPLEMENTAL BOND ISSUANCE OF APPROXIMATELY 5.7 MILLION WOULD BRING THAT CALCULATION TO 54%.
THE INDUCEMENT RESOLUTION IS REQUESTING 6 MILLION AS A MAXIMUM AMOUNT, AND THE EXACT AMOUNT TO BE ISSUED WILL BE SOLIDIFIED DURING THE APPLICATION AND UNDERWRITING PROCESS.
BUT THE MAXIMUM REQUEST DOES PROVIDE FLEXIBILITY UNTIL WE GET TO THAT PARTICULAR POINT.
REQUESTING A SUPPLEMENTAL BOND ALLOCATION TO MEET THE 50% TEST IS NOT UNCOMMON IN RECENT YEARS, IN FACT, DURING THE LAST LEGISLATIVE SESSION, THE BOND REVIEW BOARD'S GOVERNING STATUTE WAS CHANGED IN RESPONSE TO A BILL THAT PRIORITIZED PROJECTS FOR NEEDING ADDITIONAL BONDS TO MEET THE 50% TEST OVER REGULAR PROJECTS.
THERE HAVE BEEN SUPPLEMENTAL BOND ALLOCATIONS ON A FEW LOCAL ISSUER TRANSACTIONS, AND THIS IS NOT THE FIRST REQUEST THAT THE DEPARTMENT HAS RECEIVED FOR ONE OF ITS PREVIOUS TRANSACTIONS.
TO SUBSTANTIATE THE INCREASED COSTS, THE APPLICANT PROVIDED A SCHEDULE OF VALUES THAT COMPARES THE ORIGINAL CONSTRUCTION NUMBERS TO WHERE THEY BELIEVE THE PROJECT WILL END UP, SEPARATE FROM WHAT WAS SUBMITTED IN THEIR SUPPLEMENTAL APPLICATION.
THE DEPARTMENT RECEIVES QUARTERLY CONSTRUCTION REPORTS THAT I'LL REFER TO AS THE CSR THAT ARE INTENDED TO INFORM THE DEPARTMENT HOW CONSTRUCTION IS PROGRESSING, DELAYS IN COMPLETION AND CHANGE ORDERS THAT OCCUR.
[01:30:10]
THERE WERE NOT VAST DIFFERENCES IN COSTS THAT COULD NOT BE EXPLAINED.THE CSR THAT WAS DATED JUNE OF 2024 REFLECTED 5.8 MILLION IN CHANGE ORDERS, WHICH HAS SINCE INCREASED TO 7.6 MILLION, BRINGING THE TOTAL CONSTRUCTION CONTRACT TO 36 MILLION FROM 34.
THAT WAS IN THAT CONSTRUCTION STATUS REPORT.
AS A SIDE NOTE, STAFF DID RE-UNDERWRITE THIS DEAL AT THE TIME THE MATERIAL AMENDMENT WAS REQUESTED AND THE APPLICANT INDICATED THE TOTAL VALUE OF THE CONSTRUCTION CONTRACT WAS 34 MILLION.
THE 50% TEST CALCULATION AT THAT TIME WAS 50.01.
THE CONSTRUCTION PROCESS AND THE POTENTIAL RISK ASSOCIATED WITH NOT MEETING THE 50% TEST.
STAFF RECOMMENDS ADOPTION OF RESOLUTION NUMBER 25007 IN THE AMOUNT OF 6 MILLION.
CORRECT. AND THEY ADDED 30 UNITS FROM THE ORIGINAL 174.
CORRECT. SO THE INCREASED 17.4% MORE UNITS BY MY MATH.
WHY IS IT COST 60% MORE TO BUILD? WHY IS THE COST INCREASE 60% WHEN YOU'RE ONLY ADDING A MARGINAL AMOUNT OF ADDITIONAL UNITS.
THAT JUST DOESN'T SEEM TO ADD UP TO ME.
BUT YES, I MEAN, THAT'S WE ALL KNOW THAT ANSWER.
YES. DO WE KNOW WHAT HOW MUCH THE DEVELOPER FEES INCREASED IN THAT PORTION? I DIDN'T SEE IT IN THE MATERIAL.
WOULD IT BE 15% OF 5 MILLION? SIX. 6 MILLION.
THE DEVELOPER FEE AT ORIGINAL APPLICATION WAS 5.6 MILLION.
APPROXIMATELY. IN THEIR SUPPLEMENTAL, IT IS SUGGESTED TO BE 6.7 MILLION.
SO A MILLION. ONE OFF THE ORIGINAL 5.6.
AND AGAIN, JUST SO I UNDERSTAND.
OR MAYBE EVEN THE BOARD MEMBERS UNDERSTAND.
SO THEY'RE CHANGING IT FROM 174 TO 204 THAT.
THEY DIDN'T HAVE TO CHECK WITH US FIRST BEFORE THEY SAY HEY, THIS IS GOING TO INCREASE.
WE DID APPROVE THE AMENDMENT, THE MATERIAL AMENDMENT.
YES. INCLUDING THIS COST, 60% INCREASE PROBABLY.
I'M SURE WE DIDN'T KNOW COST THAT WELL.
SO IT WAS THIS THE INCREASE OF COST IN LINE WITH THE COST PER UNIT ON THE ORIGINAL PROJECT OF 174? I DON'T BELIEVE SO.
NO, BUT THAT'S NOT IT'S SIGNIFICANTLY HIGHER.
I DON'T I MEAN IT HAS TO BE BECAUSE YOU HAVE ALL THE FIXED COSTS OF THE LAND AND THE SITE PREP AND ALL THAT SUCH THAT DOESN'T INCREASE WITH THE NUMBER OF UNITS. SO SOMEHOW THIS IS JUST WAY HIGHER PER UNIT TO ADD THESE 30.
IT JUST, IT SEEMS. WHY DOES THIS SUDDENLY BECOME OUR PROBLEM AT THE DEPARTMENT? I DON'T KNOW WHAT THE REST OF THE BOARD MEMBERS FEEL.
I GUESS THERE'S NOT A REPRESENTATIVE FROM THE DEVELOPER HERE.
I WOULD SAY IT'S PARTIALLY ON THE DEPARTMENT BECAUSE WE APPROVED THE ADDITIONAL UNITS IN PART.
RIGHT. DOES ANYONE CARE TO MAKE A MOTION ON THIS ITEM OF THE AGENDA
[01:35:03]
NUMBER? ITEM 16.CAN YOU GIVE US SOME MATH AGAIN? SO ORIGINALLY IT WAS 23 POINT.
EIGHT WAS THE BOND AND THE ORIGINAL COST WAS HOW MUCH AGAIN 34, 29, 29.
OKAY. SO THE CONSTRUCTION CONTRACT JUMPED FROM A 2021 DEAL TO A 2024 DEAL FROM 29 TO 36.
ALL RIGHT. SO WE WENT UP $7 MILLION IN THAT PERIOD OF TIME.
OKAY. AND THE HIGHEST LEVEL OF CONSTRUCTION IN THE HIGHEST LEVEL OF CONSTRUCTION INFLATION THAT I HAVE EXPERIENCED.
OKAY. SO I JUST USUALLY I'M THE MEAN GUY UP HERE, BUT I'M JUST KIND OF GIVING YOU GUYS SOME BACKGROUND OF WHAT HAS HAPPENED IN THE MARKET AT THAT MOMENT. WE SAW ABOUT 26 TO 32 POINTS OF INFLATION IN THAT PERIOD OF TIME.
AND IT WAS A VERY DIFFICULT TIME TO BUILD.
SO YOU WERE YOU KNOW, SO OUR CLIENT HERE, OUR DEVELOPER HAS ADDED MORE UNITS AND THE RATES GOES UP.
AND HE'S ASKING FOR $6 MILLION MORE OF BOND ALLOWANCE.
OKAY. LET'S CLARIFY ONE MORE NUMBER THOUGH.
WHAT WAS THE ORIGINAL COST OF THE PROJECT.
RIGHT? OR CONSTRUCTION COSTS? 23 MILLION WAS THE ORIGINAL BOND AMOUNT.
OKAY, BUT WHAT WAS THE ORIGINAL DEVELOPMENT COSTS FOR THE ENTIRE PROJECT? WAS IT 51,000,409? THOUSAND? I THINK IT WAS.
MY UNDERSTANDING IS THAT THE ORIGINAL PROJECT WAS 51,409,000.
THE REVISED FINAL AMOUNT IS 81,000,763, A $30 MILLION INCREASE.
THE TOTAL DEVELOPMENT COST THAT WHAT THEY'VE PROJECTED.
THE TOTAL DEVELOPMENT COST TO BE IS 56 MILLION.
THE 36 THAT I WAS REFERRING TO EARLIER, THAT IS THE VALUE OF THE CONSTRUCTION CONTRACT, WHICH WOULD HAVE AN ESCALATION COST. BUT.
WHEN I ASKED, THEY HAD NO ONE PRESENT.
THEY ASKED. MR. CHAIRMAN. ON 16.
WHERE DO YOU HAVE THAT IN YOUR PACKET? BECAUSE I DON'T SEE THOSE NUMBERS.
WELL. I WAS PROVIDED A SUMMARY WHICH APPARENTLY IS NOT ACCURATE. GOOD AFTERNOON.
GOOD MORNING. BOARD. MY NAME IS ACOPIA.
I WORK WITH SPHINX DEVELOPMENT CORPORATION.
WE'RE THE DEVELOPERS ON THIS PROJECT.
I THINK THE NUMBER THAT YOU'RE LOOKING AT MIGHT BE THE TOTAL BASIS AFTER THE BOOST, BUT THE TOTAL PROJECT COST IS CERTAINLY NOT 80, $70 MILLION.
DO YOU KNOW WHAT THE TOTAL DEVELOPMENT COSTS? I WOULD I MEAN, YOU DON'T HAVE TO BE EXACT.
YEAH, IT'S GOING TO BE IN THAT 56, $57 MILLION RANGE.
GERENCSER. MR. MORRISON, WHAT DOES THE CAMERON COUNTY HOUSING FINANCE CORPORATION ACT DO WITH THIS PROJECT IN CAMERON COUNTY DOWN SOUTH? SO THEY ARE OUR NONPROFIT PARTNERS.
IN GENERAL, FOR MOST OF THE BOND AND 4% PROJECTS.
YES. BROWNSVILLE, CAMERON COUNTY IS THAT IS YOUR FINANCE PARTNER IN DALLAS? WELL, I YES, SIR.
I BELIEVE THAT THE WAY THE STATUTE IS STRUCTURED, IT ALLOWS THE HOUSING FINANCE CORPORATIONS WITH CORPORATION HOUSING AUTHORITY, DIDN'T THEY PASSED ON THIS DUE TO THE TIMING OF FOR CLOSING THE BONDS?
[01:40:04]
THEY ARE PROCEDURES WOULDN'T WOULDN'T HAVE ALLOWED US TO MEET THE 180 DAY DEADLINE TO CLOSE THE BONDS, BUT.CAMERON COUNTY ROAD TO THE RESCUE.
YES, SIR. IS THERE ANYONE HERE FROM CAMERON COUNTY? I DON'T BELIEVE SO, MA'AM.
YOU JUST FIND THE HOUSING AUTHORITY IS WILLING TO UNDERWRITE IT, AND THEY GET THE FEES.
YEAH. AND I EXPECT LEGISLATION BASED ON CONVERSATIONS THIS COMING SESSION TO.
SO THE TOTAL DEVELOPMENT COSTS AROUND 56.
I MEAN, THEY THE TOTAL ONLY INCREASE THAT SMALLER PERCENT.
THE FIGURES I WAS LOOKING AT WITH 51 MILLION GOING UP TO 81 MILLION ARE NOT APPLICABLE TO THIS.
AND I GUESS MISS MORALES, YOU SOMEONE PUT FORTH WHEN THE SUMMARIZING THE THE AGENDA FOR ME PUTTING IN THOSE THOSE CRAZY HIGH NUMBERS.
YOU'RE SAYING THOSE DON'T APPLY.
IT'S THESE ONES YOU'RE TELLING US TODAY.
MISS TERESA MORALES FOR THIS TRANSACTION.
THOSE NUMBERS ARE NOT CORRECT.
AT THE TIME OF THE ORIGINAL APPLICATION, IT WAS APPROXIMATELY 51 MILLION.
THAT GIVES ME A WHOLE DIFFERENT PERSPECTIVE.
THE STAFF'S RECOMMENDATION IS TO GRANT THIS MOTION FOR THE ADDITIONAL 6 MILLION INDUCEMENT.
RIGHT. DOES ANYONE WANT TO MAKE A RECOMMENDATION OR A MOTION ON STAFF'S RECOMMENDATION? OR DO WE NEED FURTHER DISCUSSION AND INPUT? I THINK THE MY OBSERVATION IS THERE TO BE COMMENDED FOR PUTTING MORE UNITS OUT THERE.
I JUST DON'T UNDERSTAND HOW THEY GOT THERE IN THE FINANCING IT HAVE A VOTE? IS OUR MOTION TO RECOMMEND.
THIS SENDS A SIGNAL TO THE DEVELOPMENT COMMUNITY THAT THIS THIS CAN HAPPEN AND WITHOUT.
IT'S PRETTY SIMPLE BUT I UNDERSTAND THE COST ESCALATION.
AND I THINK OKAY WELL AND AGAIN I THOUGHT IT WAS A WAY WAY HIGHER INCREASE.
SO I'M COMFORTABLE WITH THIS OKAY.
YEAH I MEAN HE STILL COMES IN AROUND 275,000 A UNIT, WHICH IS PRETTY MUCH FOR MOST UNITS ARE.
SO IF IT HAD ESCALATED, YOU KNOW, WAY, WAY UP.
MR. CHAIRMAN, I MOVE THE BOARD, APPROVE THE INDUCEMENT RESOLUTION NUMBER 25 007 AND PROCEED THE APPLICATION SUBMISSION FOR THE BRB FOR POSSIBLE RECEIPT OF STATE VOLUME CAP ISSUANCE FOR THE SUPPLEMENTAL BOND APPLICATION FOR FIJI LOFTS.
MOTION MADE BY MR. HARPER TO APPROVE.
ANY FURTHER DISCUSSION? ALL THOSE IN FAVOR SAY AYE.
THANK YOU. IF IF I MAY, I JUST WANT TO CLARIFY THE CAMERON COUNTY ENTITY MENTIONED RIGHT NOW HAS NOTHING TO DO WITH EITHER THE HOUSING AUTHORITY OF THE CITY OF BROWNSVILLE, WHICH I AM A PART OF, OR THE CAMERON COUNTY HOUSING AUTHORITY.
JUST SINCE YOU SPOKE. CAN YOU STATE YOUR NAME FOR THE RECORD AND SIGN? SIGN IN. OR REPEAT YOUR NAME FOR THE RECORD.
OKAY. MOVING ALONG THIS ITEM 17.
PRESENTATION, DISCUSSION AND POSSIBLE ACTION ON INDUCEMENT.
RESOLUTION NUMBER 25 009 FOR MULTIFAMILY HOUSING REVENUE BONDS REGARDING AUTHORIZATION FOR FILING AN APPLICATION FOR PRIVATE ACTIVITY BOND AUTHORITY FOR MURDOCK VILLAS.
[01:45:10]
SUPPLEMENTAL BOND ALLOCATION.MURDOCK VILLAS INVOLVED THE ISSUANCE OF 35 MILLION IN TAX EXEMPT BONDS FOR THE ACQUISITION AND REHABILITATION OF AN EXISTING AFFORDABLE DEVELOPMENT THAT CLOSED IN MAY OF 2021.
THE SCOPE OF WORK PLANNED WAS NOT JUST THE NORMAL REHAB, BUT IT ALSO INCLUDED SOME DEMOLITION AND INCREASE IN THE TOTAL NUMBER OF UNITS FROM 240 TO 301, SO A 61 UNIT INCREASE AS THREE AND FOUR BEDROOM UNITS WITH A HISTORY OF LOW OCCUPANCY WERE CONVERTED TO ONE BEDROOM AND EFFICIENCY UNITS AS IT RELATES TO THE 50% TEST CALCULATION, ASSUMING THE ORIGINAL ISSUANCE OF 35 MILLION AND THE INCREASED COSTS THAT THEY'VE REPRESENTED, IT WOULD PUT THE CALCULATION AT APPROXIMATELY 45.3%.
WITH THE ADDITIONAL ISSUANCE OF 5 MILLION, IT WOULD PUT THE CALCULATION AT APPROXIMATELY 51.7%.
IN RESPONSE TO STAFF'S QUESTIONS OR QUESTIONS THAT THAT STAFF RAISED DURING ITS REVIEW, THE OWNER PROVIDED A SIDE BY SIDE COMPARISON OF THE COSTS AT THE TIME OF THE ORIGINAL APPLICATION AND WHAT THEY BELIEVE THE FINAL COSTS WILL BE.
EXHIBIT A BEHIND THIS ITEM INCLUDES A BREAKDOWN OF THOSE COSTS.
AS I MENTIONED ON THE PREVIOUS AGENDA ITEM, THERE ARE CONSTRUCTION STATUS REPORTS THAT ARE SUBMITTED TO THE DEPARTMENT AND STAFF REVIEWED THE SIDE BY SIDE COMPARISON TO THE MOST RECENT CSR SUBMISSION.
AS A POINT OF CLARIFICATION, THAT I NEED TO MAKE THE BOARD WRITE UP INCORRECTLY NOTES THAT THE DEVELOPER SLASH CONTRACTOR NOTIFIED THE GENERAL PARTNER THAT IT WAS INTENDING TO STOP WORK ON THE PROJECT.
THE CLARIFICATION BEING THAT THOSE ENTITIES ARE NOT ONE AND THE SAME.
SINCE THAT TIME, THE OWNER HAS TAKEN OVER AND HAS BEEN WORKING TO BID OUT THE REMAINING WORK.
WHEN THEY REALIZED THAT THE ORIGINAL BID WAS SUBSTANTIALLY UNDERSTATED.
THE OWNER HAS CONTRIBUTED OVER 6 MILLION TO KEEP THE PROJECT MOVING FORWARD.
WHILE THE COST INCREASES AND CIRCUMSTANCES WITH WHICH THE OWNER IS IN IS CONCERNING.
FREDDIE MAC WOULD THEN PURCHASE THE BONDS AT THAT CONVERSION AND HOLD DURING THE PERMANENT PHASE.
INTEREST RATE IN CONNECTION WITH AN EXTENSION OF THAT MATURITY DATE TO MAY 1ST 21, 20 2024, SO A SIX MONTH EXTENSION OF CONVERSION. THE INTEREST RATE DURING THE CONSTRUCTION PERIOD WAS VARIABLE RATE AND EQUAL TO THE GREATER OF 4.75%, AND THE NEW YORK PRIME IN EFFECT ON THE DATE OF THE CALCULATION, PLUS 1.5%.
SINCE THE TRANSACTION CLOSED, THE NEW YORK PRIME RATE INCREASED AT AN UNPRECEDENTED PACE, WHICH RESULTED IN A CONSTRUCTION PERIOD INTEREST RATE THAT WAS NOT SUSTAINABLE FOR THE PROJECT, CONSIDERING THE EXTENSION THAT WAS NEEDED BEFORE CONVERSION WAS TO OCCUR, THE PARTIES ENTERED INTO AN INTEREST DEFERRAL AGREEMENT THAT MODIFIED THE CONSTRUCTION PERIOD INTEREST RATE FROM 10% TO 7%, WITH THE REMAINING 3% DEFERRED AND TO BE PAID AT CONVERSION.
THE EXTENSION TO THE CONVERSION WAS APPROVED BY IBC BANK AND FREDDIE MAC.
IT WAS THROUGH MAY 1ST OF 2024.
THE DEPARTMENT HAS NOT BEEN ADVISED WHETHER A SECOND EXTENSION WAS OR WILL BE GRANTED, OR WHEN CONVERSION IS EXPECTED TO OCCUR, BASED ON THE DOCUMENTS AVAILABLE TO THE DEPARTMENT THROUGH THE CONSTRUCTION STATUS REPORTS.
[01:50:02]
THE PROJECT IS ESTIMATED TO BE COMPLETE IN MAY OF 2025.WHILE THERE ARE STILL SOME UNANSWERED QUESTIONS RELATING TO THE STATUS OF THE ORIGINAL BONDS, THERE HAVE BEEN A SERIES OF UNFORTUNATE EVENTS ASSOCIATED WITH THIS DEVELOPMENT THAT THE OWNER IS ACTIVELY WORKING TO REMEDY IN ORDER TO MOVE IT FORWARD.
SINCE THERE IS A 180 DAY DEADLINE TO CLOSE, SHOULD CLOSING NOT OCCUR BY THIS DATE, THE DEPARTMENT WILL RETURN THE RESERVATION AND THE VOLUME CAP WILL FLOW TO THE NEXT PROJECT IN LINE.
STAFF RECOMMENDS ADOPTION OF RESOLUTION NUMBER 25009 IN THE AMOUNT OF 5 MILLION.
ANYONE HAVE A QUESTION? ARE THERE PICTURES? I MEAN, IS THERE IS THERE SOME VISUAL THING I CAN LOOK AT THAT I WOULD THINK THAT IF I COULD LOOK AT IT VISUALLY, I WOULD KNOW WHETHER THEY'RE ACTUALLY GOING TO BE FINISHED BY THEN.
IS IT. WHAT STAGE IS IT IN? ANYBODY KNOW? OR WE HAVE SOME REPRESENTATIVES.
ARE THERE ANY OTHER QUESTIONS THAT THERESA CAN ASK? ANSWER. OKAY.
LET ME BEST BEFORE WE GET YOU ALL TO COME UP.
SO IN THE SIDE BY SIDE TABLE OF THE ORIGINAL COSTS AND THE SUPPLEMENTAL COSTS, AGAIN THEY INCREASED THE UNITS BY 25% WENT FROM 240 TO 300.
OKAY. BUT SO SO THAT WILL ACCOUNT FOR SOME OF THE THE PRICING INCREASE BECAUSE WE'RE FREQUENTLY SEEING PRICES INCREASE 03,040%. BUT THESE PRICES I MEAN I'M JUST LOOKING AT ALL THESE COSTS DOUBLING OR MORE.
WHICH JUST RAISES ALL KINDS OF RED FLAGS, INCLUDING THE DEVELOPER FEE, GOING FROM 04,000,490 TO 9.1 MILLION. THAT'S OVER $5 MILLION, RIGHT? SO THAT'S ADDED TO THE COST.
IF THAT DIDN'T INCREASE THIS THE WAY WE'RE ASKING FOR $6 MILLION.
HALF OF THAT DISAPPEARS IF WE STUCK WITH THE ORIGINAL ORIGINAL COST.
I MEAN, IS THAT AM I MAKING SENSE ON THAT? BY JUST THE MATH, YOU HAVE TO HAVE 50% OF COST COVERED BY THE BONDS.
ANYONE AM I? I THINK THIS IS EASY MATH, ISN'T IT? SO THE FACT THAT THEY INCREASE THE DEVELOPER COSTS.
DEVELOPER FEES THAT ACCOUNTS FOR HALF OF THIS BOND INCREASE THAT INDUCEMENT THAT THEY'RE ASKING FOR.
I DON'T KNOW THAT THAT'S THE WAY THAT I LOOK AT IT.
THE INCREASE IN DEVELOPER FEE IS A FUNCTION OF THE INCREASE IN COSTS.
WELL, IT WOULD BE HALF OF IT IS.
WHAT I'M SAYING IS THAT GETS US PARTIALLY THERE.
AND THEN THE FINANCING COSTS DOUBLING SEEMS. AGAIN, WE CAN UNDERSTAND THAT THERE'S COST STRUCTURES.
AND WE CAN HAVE SCOTT COME BACK UP HERE AND TALK TO US ABOUT INTEREST RATES AGAIN.
BUT DOUBLING THE FINANCING COSTS JUST SEEMS EXTRAORDINARY.
HARPER, DID YOU HAVE ANY QUESTIONS OR COMMENTS? DID SQUARE FOOTAGE INCREASE OR STAY THE SAME? IT STAYED THE SAME.
IT'S NOT LIKE THE PREVIOUS TRANSACTION WHERE THEY DID THAT AFTER CLOSING.
SO SQUARE FOOTAGE STAYED THE SAME.
WE JUST WE ADDED MORE BATHROOMS, KITCHENS AND RESTROOMS OR SHOWERS.
MORE DOORS. SAME SQUARE FOOTAGE.
OKAY, SO I'VE GOT LIKE COSTS OF 197 K ORIGINALLY PER DOOR, AND NOW WE'RE AT 271 K PER DOOR IN THE 301. WHICH IS LIKE 39, 38% INCREASE IN COST.
[01:55:02]
IF YOU LOOK AT IT ON A DOOR DOOR COST.BUT OUR SQUARE FOOTAGE DIDN'T CHANGE.
SO I SAID, LOOKS LIKE THE DEVELOPER WANTS TO SPEAK.
IDENTIFY YOUR YOUR NAME AND WHICH ORGANIZATION WHERE YOU FIT INTO.
MY NAME IS ADAM HORTON AND I AM WITH TRINITY HOUSING DEVELOPMENT.
WHO IS THE DEVELOPER? A COUPLE OF THINGS I WANT TO CLARIFY.
IN LOOKING AT THE SIDE BY SIDE COMPARISON, THE 14.89, WE MUST HAVE ENTERED THAT IN CORRECTLY.
THAT IS THE COST THAT HAS BEEN SPENT TO DATE.
THE ORIGINAL CONSTRUCTION CONTRACT WAS WAS 22 MILLION.
REGARDING THE INTEREST, THE FINANCING COST, THAT IS ALL A FUNCTION OF THE INTEREST RATE.
AS THERESA MENTIONED, WE STARTED OUT WITH A 4.75% INTEREST RATE AND UP UNTIL JANUARY OR DECEMBER 1ST OF 2023, THAT HAD RISEN TO 10.5%. AND THERE WERE ALSO SIGNIFICANT DELAYS IN THE PROJECT THAT JUST EVERY MONTH ACCUMULATES MORE AND MORE INTEREST.
REGARDING THE DEVELOPER FEE, IT DID INCREASE.
I WOULD ARGUE TO SOME DEGREE THAT'S AN INCREASE.
ON PAPER. WE ARE DEFERRING 100% OF OUR DEVELOPER FEE AT THIS POINT IN WORKING WITH PNC.
BUT WE ARE NOT RECEIVING ANY DEVELOPER FEE ON THIS DEAL AT THIS POINT.
THERE WERE A COUPLE OF THINGS I JUST WANTED TO SAY.
WE DO THANK YOU FOR YOUR CONSIDERATION OF THIS MATTER.
WE'VE BEEN IN TEXAS QUITE A WHILE.
WE HAVE OVER 20 PROJECTS THAT WE'VE DEVELOPED, AND WE HAVE MORE IN THE PIPELINE.
AND WE TRY TO BE THE BEST STEWARDS OF THE TAXPAYER MONEY AS WE CAN.
AND THEN WE HAD AN ISSUE WITH ENTERGY.
THE ENERGY PROVIDER THERE DELAYED THE PROJECT SIX MONTHS ON THE RECONFIGURED UNITS.
THEY HAD TO COME OUT AND HOOK UP ADDITIONAL ELECTRIC.
SO THAT'S OUR THAT'S OUR REASON.
AS IT WAS MENTIONED, WE DID HAVE AN ORIGINAL CONTRACTOR ON THIS.
THEY TERMINATED TOWARD THE END OF 2023.
SO WE PROBABLY STARTED OUT WITH THE BUDGET.
WAS YOUR GENERAL CONTRACTOR BONDED TO YOU? THEY WERE NOT BONDED.
WERE YOUR SUBCONTRACTORS BONDED TO YOU? TO THE GENERAL? I DON'T KNOW IF THEY WERE IF THEY WERE BONDED TO THE CONTRACTOR AND THERE WAS NO SUB GUARD ON THE PROJECT.
THERE WAS WHAT? IT'S ANOTHER WAY TO BOND.
OH MY NEXT QUESTION IS, DID YOU HAVE AN OPTION ON A VARIABLE RATE VERSUS A FIXED RATE DURING CONSTRUCTION? IT SEEMS LIKE A LOT OF RISK FOR A DEVELOPER.
I DON'T THINK ANYBODY FORESAW THE RAPID RISE IN RATES.
WHAT WAS YOUR ORIGINAL COST? BECAUSE THE NUMBERS WE HAD BEFORE THIS BOARD ARE DIFFERENT THAN WHAT YOUR ORIGINAL COSTS WERE, WHICH IS SKEWING THE INFLATION THAT WE EXPERIENCED IN THAT TIME. I THINK THERE'S ABOUT A $7.5 MILLION DISCREPANCY IN THE STARTING NUMBERS, WHICH ARE ABOUT 47 MILLION.
SO I THINK IT WAS CLOSER TO 54 MILLION, AND NOW IT'S AT 81.
I THINK 9 MILLION IS CONSTRUCTION RELATED.
5 MILLION IS RELATED TO THE CONSTRUCTION INTEREST AND THEN 5 MILLION FOR THE DEVELOPER FEE.
MR.. YOU SAID YOU PUT 20 HOW MUCH MONEY INTO THE PROJECT? TRINITY HAS PUT UP CLOSE TO $6 MILLION IN THE PROJECT TO DATE TO KEEP IT MOVING.
IS THAT A LOAN THAT'S GOING TO BE REIMBURSED THROUGH THE FINAL FINANCING? IT IS A GP LOAN.
CURRENTLY, AT LEAST 3 MILLION OF IT IS FIGURED IN TO BE LEFT INTO THE PROJECT LONG TERM.
MR. CHAIRMAN, JUST FOR MY OWN EDUCATION.
WHAT MAKES UP SOFT COSTS? IN THIS CASE, IT WOULD BE ARCHITECT FEES.
WE DID HAVE TO DO TWO EXTENSIONS WITH FREDDIE MAC.
AND THEN WE HAVE WORKED ON THE SECOND EXTENSION.
[02:00:08]
WHICH HAS A 4.544% PERM RATE, WHICH IS VERY ATTRACTIVE.WE WANT TO MAINTAIN THAT RATE AND FREDDIE MAC IS COMMITTED TO THE PROJECT.
WE'VE HAD MULTIPLE CALLS WITH THEM.
THANK YOU. OKAY, SO TO RECAP, THE DEVELOPER FEE IS ALL BEING DEFERRED.
YES. AND THE CONTRACTOR FEE IS WE'RE NOT TAKING ANY CONTRACTORS BECAUSE WE TOOK OVER.
YOU GOT RID OF THE CONTRACTOR.
AND THEN THE BUILDING COSTS ARE IN THE BOARD BOOK.
THE ORIGINAL OR UNDERSTATED BY 7 MILLION OR SO.
I'M GOING TO READ SOME NUMBERS TO YOU.
TELL ME IF YOU THINK THESE NUMBERS ARE CORRECT, BECAUSE IT'S GOING TO MAKE YOUR LIFE A LOT BETTER.
YOU'RE GOING TO SPEND $81 MILLION, $81.67 MILLION.
YOU'RE GOING TO BUILD 301 DOORS, WHICH IS ROUGHLY 269 K DOORS.
SOMEBODY DOUBLE CHECK MY MATH HERE.
THAT'D BE GREAT. THE ORIGINAL COST WAS $54 MILLION FOR $240, OR 225 K, FOR WHICH WOULD BE A 19% INCREASE IN YOUR COST FROM THE ORIGINAL DOORS TO THE SECOND DOORS.
OKAY. YES. YOU LIKE THAT NUMBER? I BELIEVE THAT'S CORRECT.
I THINK WE WERE ALWAYS GOING TO PLANNING ON 301 DOORS.
OKAY. WAS THERE ALWAYS 301 DOORS? NOT 240? I THINK YEAH, WHEN WE APPLIED, WE INTENDED TO DO IT 301.
OKAY. SO CAN I ASK THE QUESTION, CAN YOU FINISH BY THIS DEADLINE THAT'S BEEN PUT ON IT? WE CAN. WE WERE WORKING WITH PNC COMING IN AS THE EQUITY INVESTOR TAKING OUT THE ORIGINAL EQUITY INVESTOR.
THEY'VE DONE MULTIPLE SITE VISITS AND THEY ARE COMFORTABLE.
WE'VE GOT ABOUT A 6 TO 8 MONTH CONSTRUCTION PHASE.
STAGE. IS IT IN? SO 100 UNITS OF THE 301 UNITS ARE ESSENTIALLY READY TO BE PLACED IN SERVICE.
WE'RE WAITING TO PLACE THEM IN SERVICE UNTIL WE HAVE THE INVESTOR IN FOR TAX CREDIT PURPOSES.
AND THEN THE THE FINAL 200 WILL BE REHABBED BETWEEN 6 TO 8 MONTHS.
WELL GIVEN THE GO AHEAD GO AHEAD.
SO THEY BOUGHT IT AND IT HAD TWO 240.
BUT THE PLANS FROM THE BEGINNING WERE TO CREATE 301 UNITS IN THAT STRUCTURE, WHICH IS 50% MORE PER DOOR THAN IT WAS BEFORE BECAUSE YOU HAD MORE DOORS.
GREAT. COS NOW WE GET MORE COST.
SAME DOOR. IT'S ONE FROM 22 MILLION TO 31 MILLION.
YEAH. AND AGAIN, I MEAN, FOR JUST CLARIFICATION PURPOSES, WE WERE NOT THE ORIGINAL CONTRACTOR.
YOU KNOW, OUR MISTAKE, PROBABLY OR NOT.
AND WE'VE TAKEN OVER AS CONTRACTOR AND FEEL CONFIDENT WITH WHAT THAT COST IS NOW.
OKAY. STAFF'S RECOMMENDATION IS TO.
WHERE ARE WE ON STAFF'S RECOMMENDATION? THERESA, WERE YOU GOING BACK AND RE SUMMARIZE.
STAFF RECOMMENDS THAT THE INDUCEMENT RESOLUTION IN THE AMOUNT OF 5 MILLION BE APPROVED.
OKAY. DOES ANYONE CARE TO MAKE A MOTION ON THIS ITEM OF STAFF'S RECOMMENDATION.
MR. CHAIRMAN, I MOVE THAT THE BOARD APPROVE INDUCEMENT RESOLUTION NUMBER 25, DASH 009 AND PROCEED WITH THE APPLICATION SUBMISSIONS TO THE BRP FOR POSSIBLE RECEIPT OF STATE VOLUME CAP ISSUANCE FOR THE SUPPLEMENTAL BOND APPLICATION OF MURDOCK VILLAS, ALL AS DESCRIBED, CONDITIONED AND AUTHORIZED IN THE BOARD ACTION, REQUEST RESOLUTION AND ASSOCIATED DOCUMENTS ON THIS ITEM.
IS THERE A SECOND? SECOND. SECONDED BY MISS FARIAS.
AYE. AYE. ANY NOES? ABSTAIN. OKAY.
SO WE HAVE FIVE YESES AND ONE ABSTAIN.
CONTINUING. I'M 18 IS STILL ON THE AGENDA.
[02:05:01]
OKAY. 19 OKAY.OKAY. SO 18 PRESENTATION, DISCUSSION AND POSSIBLE ACTION ON INDUCEMENT RESOLUTION NUMBER 25 005 FOR MULTIFAMILY HOUSING REVENUE BONDS REGARDING AUTHORIZATION FOR FILING APPLICATIONS FOR PRIVATE ACTIVITY BOND AUTHORITY FOR LEGACY RIVERSIDE SENIOR LIVING COMMUNITY.
MISS MORALES, CONTINUING WITH THE THEME, ITEM 18, ALSO INCLUDES CONSIDERATION OF AN INDUCEMENT RESOLUTION ASSOCIATED WITH THE REQUEST FOR A SUPPLEMENTAL BOND ALLOCATION.
THE OWNER HAS REQUESTED THE DEPARTMENT ISSUE ADDITIONAL TAX EXEMPT BOND FINANCING TO OFFSET THE INCREASED COSTS THEY BELIEVE WILL ALLOW THE PROJECT TO MEET THE 50% TEST.
LEGACY. RIVERSIDE SENIOR LIVING INVOLVED.
THE ISSUANCE OF 40 MILLION IN TAX EXEMPT BONDS FOR THE NEW CONSTRUCTION OF 264 UNITS IN FORT WORTH.
THE TRANSACTION CLOSED ON DECEMBER 21ST OF 2020.
AS IT RELATES TO THE 50% TEST CALCULATION, AS NOTED PREVIOUSLY, STAFF PERFORMS A PRELIMINARY CALCULATION AT THE TIME OF ORIGINAL UNDERWRITING WHILE THE BOND AMOUNT IS FIXED.
THE AGGREGATE BASIS PORTION OF THE CALCULATION IS SOMEWHAT VARIABLE, SINCE IT'S BASED ON AN ESTIMATE OF WHAT THE APPLICANT BELIEVES THE COSTS TO BE AT THE TIME OF THE ORIGINAL UNDERWRITING, UTILIZING A BOND ISSUANCE AMOUNT OF 40 MILLION.
THE PERCENT FINANCED BY TAX EXEMPT BONDS WAS 94.3%.
CONSIDERING THE COST INCREASES, ASSUMING THE ORIGINAL BOND AMOUNT, THE 50% TEST CALCULATION, BASED ON THE NUMBERS PROVIDED BY THE APPLICANT IS 49.6%, AND WITH THE SUPPLEMENTAL BONDS BRINGING THE TOTAL TAX EXEMPT BOND AMOUNT TO 45 MILLION.
IT WAS REPRESENTED THAT IT WOULD BRING THE CALCULATION TO 55.8%.
THE SUPPLEMENTAL APPLICATION INCLUDED A CONSTRUCTION CONTRACT WITH A DETAILED SCHEDULE OF VALUES THAT IS INTENDED TO SUPPORT THE COSTS THAT THE OWNER REFLECTED IN THE COST SCHEDULE IN THE APPLICATION.
STAFF REVIEWED THIS DOCUMENT AND NOTICED MANY INCONSISTENCIES BETWEEN THE SCHEDULE OF VALUES AND THE COST SCHEDULE, MEANING THE DOCUMENT DID NOT SUBSTANTIATE THE COSTS THAT WERE BEING REPRESENTED.
AS PREVIOUSLY MENTIONED, CONSTRUCTION STATUS REPORTS OR CSRS ARE PROVIDED QUARTERLY TO THE DEPARTMENT, SO STAFF PULLED THE CSR FROM JULY OF 2024 TO REVIEW THE CONSTRUCTION CONTRACT PROVIDED THEREIN, AND FOUND THERE TO BE EVEN MORE INCONSISTENCIES ACROSS ALL OF THE DOCUMENTS.
THE TOTAL CONSTRUCTION CONTRACT VALUE WAS STATED ON THESE REPORTS AS APPROXIMATELY 40 MILLION, AND IT WAS REPRESENTED THAT THE PROJECT WAS 72% COMPLETE. THE VALUE THE OWNER REPORTED IN THEIR SUPPLEMENTAL APPLICATION WAS APPROXIMATELY 54 MILLION, REPRESENTING 14 MILLION IN ADDITIONAL COSTS THAT WERE IDENTIFIED WHEN STAFF QUESTIONED THE DISCREPANCY.
THE. THE RESPONSE WAS THAT THE NEXT CSR SUBMISSION WOULD REFLECT THE CHANGE IN COSTS.
THE NEXT CSR SUBMISSION IS ACTUALLY TODAY FOR THE PREVIOUS QUARTER.
THE OWNER INDICATED THAT THEY WERE WORKING WITH THEIR CONSTRUCTION TEAM TO GET THE NUMBERS TOGETHER AND RECONCILED, AND TWO WEEKS AFTER THE INITIAL REQUEST, A CHANGE ORDER IN THE AMOUNT OF 14.8 MILLION WAS SUBMITTED.
THIS IS INCLUDED AS EXHIBIT A IN YOUR MATERIALS.
AFTER REVIEWING THE CHANGE ORDER, THERE ARE STILL QUESTIONS AS TO ITS ACCURACY.
AS AN EXAMPLE, THE SUPPLEMENTAL APPLICATION REFLECTED A COST ASSOCIATED WITH A PLAYGROUND.
RECOGNIZING THIS AS A SENIOR PROPERTY, STAFF ASKED THE OWNER TO CONFIRM WHETHER THERE WAS GOING TO BE A PLAYGROUND, AND WAS TOLD THAT THE COST FOR THE PLAYGROUND WAS GOING TO BE REMOVED. THE CHANGE ORDER INCLUDED IN EXHIBIT A REFLECTS THAT THERE HAS BEEN A CHANGE ORDER IN THE AMOUNT OF $100,000 FOR A PLAYGROUND, AND PROVIDES AN EXPLANATION AS TO WHY THERE HAS BEEN AN INCREASE IN THIS LINE ITEM.
LIKE THE PREVIOUS AGENDA ITEM, THIS FINANCING STRUCTURE INVOLVED IVC BANK AS CONSTRUCTION LENDER, WITH FREDDIE MAC COMING IN AT CONVERSION, PURCHASING THE BONDS AND HOLDING THEM DURING THE PERM PHASE.
[02:10:06]
2024. THE DEPARTMENT HAS NOT BEEN ADVISED WHETHER A SECOND EXTENSION WAS OR WILL BE GRANTED, OR WHEN CONVERSION IS EXPECTED TO OCCUR.CONSIDERING THE QUESTIONABLE CONSTRUCTION STATUS REPORTS, IN ADDITION TO THE INCONSISTENT CONSTRUCTION COSTS IDENTIFIED IN THE SUPPLEMENTAL APPLICATION, STAFF IS CONCERNED REGARDING THE EXTENT TO WHICH THE ACTUAL COSTS ARE KNOWN AND WHETHER THE ADDITIONAL 5 MILLION BEING REQUESTED IS ACCURATE OR EVEN NEEDED.
BASED ON THINGS THAT WE DON'T KNOW AND BASED ON INFORMATION PROVIDED THAT HAS BEEN INACCURATE, STAFF'S RECOMMENDATION ON MOVING FORWARD WITH THE INDUCEMENT RESOLUTION IS NEUTRAL.
IS THIS COMMON TO HAVE SUCH VARYING NUMBERS DISCREPANCIES? REPORTING IN YOUR EXPERIENCE WITH YOUR WITH US? BASED ON WHAT I HAVE SEEN, NO, I MEAN, I CAN'T RECALL HAVING HEARD OF IT IN THE LAST 7 OR 8 YEARS.
I MEAN, THAT'S THE MANAGEMENT, THE DEVELOPER FEE ON THIS ONE ALSO DOUBLED OR.
IT WENT FROM 5.9 MILLION TO 10.1 MILLION.
OKAY, NOT QUITE DOUBLING, BUT PRETTY CLOSE.
AND THEN WE'RE UNCLEAR AS TO THE TIMING OF WHEN THIS IS GOING TO BE ACTUALLY COMPLETED.
CORRECT. WOULD ANY REPRESENTATIVE OF THE DEVELOPER CARE TO.
EXPLAIN AGAIN, PLEASE? YES. SIGN IN. STATE YOUR NAME.
SO WE HAVE SEVERAL QUESTIONS HERE, AND I HAVEN'T BEEN DIRECTLY RELATED IN THE IN THE PRE-APPLICATION OF THE APPLICATION, SO I'M KIND OF GATHERING, YOU KNOW, THERE'S BEEN A LITTLE BIT OF MISCOMMUNICATION BETWEEN OUR STAFF AND YOUR STAFF, AND I COMPLETELY UNDERSTAND.
AND THE GOOD THING ABOUT THIS IS THAT WE DO HAVE TIME TO GO THROUGH A FULL UNDERWRITING PROCESS, AND WE COMPLETELY INTEND TO MAKE SURE THAT YOUR STAFF IS COMPLETELY COMFORTABLE WITH THIS DEVELOPMENT.
AND, MR. FISHER, I'M SORRY TO INTERRUPT, BUT SO ARE YOU THE DEVELOPER OR THE CONTRACTOR? THE GENERAL CONTRACTOR? BOTH OR BOTH? DEVELOPER AND GENERAL CONTRACTOR.
OKAY. BUT WE INTEND TO ANSWER ALL THE QUESTIONS AND, AND GET TO THE MAKE SURE THAT THEY COMPLETELY UNDERSTAND ALL OF THE BACKUP, ALL OF THE NUMBERS THAT GO INTO THIS. THE BIG PICTURE IS HERE, AS YOU'VE HEARD TODAY, IS WE'RE TRYING TO MEET THE IRS GUIDELINES FOR THIS 50% TEST.
IF WE DON'T MEET THE 50% TEST, WHICH IS IT IS A IT'S A PAPER CALCULATION EFFORT, RIGHT? AT THE END OF THE DAY, IF YOU DON'T MAKE THE CLIFF TEST AND YOU DON'T NEED THE MONEY, YOU DON'T TAKE THE MONEY.
YOU KNOW, WE DON'T GET EXCESS FUNDS.
AGREE WITH THE PREVIOUS APPLICANT.
WE WOULD NEVER, EVER COLLECT $10 MILLION IN DEVELOPER FEE.
WE ALSO WILL NOT GET ANY DEVELOPER FEE.
BUT ON PAPER, AS AS TERESA SAID, IT'S A CALCULATION BASED ON THE COMPLETE DEVELOPMENT COST.
SO AND THEN YOUR OTHER QUESTION WAS TIMING.
SO THE, THE THE QUESTION SHE HAD ABOUT THE CONSTRUCTION STATUS REPORTS COMPARED TO OUR APPLICATION, PREVIOUS QUARTERS, WE DID NOT UPDATE OUR G7 OH TWO, WHICH IS THE DRAW FORM SHOWING COMPLETE, YOU KNOW, COMPLETED TO DATE AND THE FULL CONSTRUCTION CONTRACT AMOUNT.
WE DID NOT ADJUST THAT BASED ON OUR LENDERS AND CREDIT AND INVESTORS REQUESTS.
UNTIL WE KNEW OUR FINAL WHAT WE REALLY, REALLY, REALLY BELIEVED OUR FINAL CONTRACT TO BE.
THEY DID NOT WANT US TO PASS ANY CHANGE ORDERS BECAUSE WE DIDN'T WANT TO PASS TEN.
IF IT'S AN ESTIMATE AND WE DIDN'T WANT IT INCREASING AND DECREASING.
[02:15:04]
YOU WILL SEE THAT CHANGE ORDER PROCESSED WHICH WILL NOW AGREE.SO IN PREVIOUS QUARTERS WE DID SO PART OF THE CONSTRUCTION STATUS REPORT SUBMISSION INCLUDES YOUR G7 OH TWO WHICH IS THE DROP AS WELL AS SORRY THE THIRD PARTY INSPECTOR REPORTS THOSE THIRD PARTY INSPECTOR REPORTS WE AGREE WITH.
SO THE PREVIOUS REPORT SHOWED A 67% COMPLETION, WHEREAS OUR G 702 WAS SHOWING MUCH HIGHER THAN THAT BECAUSE WE DIDN'T HAVE THE UPDATED FULL CONSTRUCTION AMOUNT LISTED.
SO AS WE PROCESS THAT CHANGE ORDER, OUR NUMBERS ARE ALIGNED MAGICALLY IT'S 67%.
THIS IS PENCILS OUT AT $318,000 PER UNIT.
YES. YEAH. AND TO 208 HARD COST.
AND THE YOUR DEVELOPER IS DEFERRED.
CORRECT. NOT NOT THAT YOU WILL RECEIVE IT.
COMPLETELY. BUT WE DON'T EXPECT TO RECEIVE ANY OF IT.
AND I DON'T UNDERSTAND THIS WORD SALAD OF OWNERSHIP OVER HERE.
WHAT IS GARLAND HOUSING FINANCE CORPORATION? YES, THEY ARE THE GENERAL PARTNER.
THE GARLAND HOUSING IN DOWNTOWN.
IF YOU KNOW THE LOCAL ISSUER IS NOT OR NOT ISSUER.
YOU'RE ABLE TO GO TO ANOTHER LOCAL HFC.
SO WHAT I MEAN, IF THIS ISN'T GRANTED WHAT HAPPENS TO IT.
YOU KNOW, IT ULTIMATELY BIG PICTURE.
IT'S JUST NOT IT WOULDN'T BE AFFORDABLE.
YEAH. AND RIGHT NOW YOU KNOW IT'S A SENIOR DEAL.
MA'AM, CAN YOU TELL ME YOUR NAME AGAIN? MELISSA FISHER. YOU ARE THE DEVELOPER AND THE BUILDER.
CORRECT. YOU HAD A DEAL BEFORE.
HOW DO YOU CONTROL YOUR COSTS? YOUR BUILDER WENT TO YOUR WEBSITE.
SEEMS LIKE YOU HAVE A LOT OF UNITS.
WE DO. WHY DO YOU HAVE SUCH ESCALATION AND COST IN YOUR PROJECT WITHOUT CONTROLS? OH, I MEAN, IT'S TERRIBLE.
YOU KNOW, WE HAD. WHY DO YOU DO THAT? WHY? WHY HAVE YOU LET THIS ESCALATION IN? EVERY DISCIPLINE YOU'VE GOT HAPPEN WHEN YOU HAVE THE RISK AS A DEVELOPER AND AS THE GC? IT'S NOT IDEAL.
I'M TRYING TO DEAL WITH IT TO MAKE SURE WE PUT THE UNITS ON THE GROUND.
BUT, I MEAN, IT'S THE SAME STORY THAT YOU'VE HEARD FOR THE LAST TWO YEARS.
AND DO YOU NOT SUPPLY SUBS? DO YOU NOT HAVE FIRM FIXED PRICING WITH YOUR SUBCONTRACTORS? YOU KNOW, WE ARE AT THE MERCY OF WHO YOU CAN SIGN UP FOR THE DEALS.
BUT BUT BASICALLY, SINCE IT'S GOING TO BE BONDED OUT AND YOU'RE GOING TO SELL THE BONDS AND WE BASICALLY GRANT, GRANT YOU THE ABILITY TO PUT THE DEBT ON BECAUSE YOU GET THE CREDITS.
YOU REALLY DON'T NEED TO CONTROL THE COST.
WELL, IF WE IF, IF, IF COSTS WERE WHERE THEY WERE, WE WOULD BE COLLECTING FEES.
WE WOULD BE BEING, YOU KNOW, PAID FOR OUR TIME AND OUR EFFORT.
I MEAN, WE'RE ESSENTIALLY NOT BEING PAID.
YOU'RE NOT INTO THE SOFT COST.
910 ONE THAT ARE GOING TO BE DEFERRED.
CORRECT. AND I'M SORRY, MR. CHAIRMAN. ONE MORE QUESTION.
PLEASE. GO AHEAD. HOW MUCH OF THIS WORD SALAD OF OWNERSHIP HOW MANY, HOW MUCH FEES DO THEY GET FOR LENDING THEIR SUPPORT FOR THIS? ARE YOU REFERRING TO THE HOUSING FINANCE CORP? I'M LOOKING THROUGH THEM. IT'S INTERESTING.
YOU HAVE TO PAY THEM. UNFORTUNATELY.
IT'S A IT'S NOT A TAX APPROPRIATE TAX EXEMPT PROPERTY IS IT.
[02:20:01]
IT IS. YES.THEY'RE NOT THE ISSUERS, SO THEY DON'T GET THE COMPLIANCE FEE.
THEY GET ABOUT 25% OF THE DEAL.
WALLACE REED SONOMA HOUSING ADVISORS.
SO THEIR THEIR PORTION OF THIS IS ABOUT 25% OF THE DEVELOPER FEE.
ANY CASH FEE. THAT WAS DEFERRED.
YES. SO THEY WON'T BE RECEIVING ANYTHING OUT THERE.
BOBBY, THIS IS WHAT YOU'RE TELLING ME, THAT IT'S GOING TO GET FIXED.
RIGHT. A POINT OF CLARIFICATION AS WELL.
EVEN THOUGH WE'RE DEFERRING OUR FEE, WE HAVE PAID THEM OUT.
IT MAY NOT BE THE FULL 25%, BUT THEY HAVE BEEN PAID DEVELOPER FEE OUT OF OUR POCKET.
SO IT'S NOT LIKE THEY'RE DEFERRING AND THEY'VE MADE NOTHING ON THE DEAL.
YES. AND TO THAT POINT, ORDINARILY AT CLOSING, YOU'RE PAID A BIT OF YOUR DEVELOPER FEE.
IT JUST DEPENDS ON YOUR INVESTOR HOW MUCH THAT IS.
WE ORDINARILY GIVE THAT TO THE HFC TO PAY THEM UPFRONT SO THAT THEY GET, YOU KNOW, TODAY FUNDS VERSUS, YOU KNOW, PUSHING IT OUT TO COMPLETION OR CONVERSION.
YEAH. MISS FARIAS, YOU HAVE A QUESTION? YES. I'M LOOKING AT EXHIBIT B, AND IT GOES.
THE ORIGINAL COST SCHEDULE WAS 50,050 MILLION.
PERCENTAGE OF INCREASE IS 111.
I WILL BE THE FIRST PERSON TO ADMIT THAT I HAVE NEVER UNDERSTOOD THE IRS.
BUT WHEN I LOOK AT EXHIBIT B, I'M LIKE, WHAT ARE WE ACTUALLY VOTING ON? BECAUSE I HEAR YOU AND I HEARD THE PREVIOUS ONE SAYING, YES, WE HAVE THIS HUGE AMOUNTS OF DEVELOPER FEES, BUT WE'RE NOT REALLY GOING TO GET THEM AND BLAH BLAH, BLAH, BLAH, BLAH, BLAH, BLAH. BUT THE FACT REMAINS, WE VOTE YES.
AND THEN THE QUESTION IS, WHAT DID YOU REALLY VOTE ON? I MEAN, IF SOMEBODY TAKES THE WHOLE PACKAGE, THEY SAID, YEAH, YOU DID VOTE ON THIS.
I CAN'T KEEP 10 BILLION, $10 MILLION.
IF I'M A LAWYER, WHICH I WAS FOR MANY YEARS, I WOULD SAY, HEY, THEY VOTED ON THIS.
SO IT DOESN'T MATTER WHAT YOU PROMISED THEM.
BUT ANYWAY, IT'S THERE JUST COMES A POINT WHERE YOU ARE COMPLETELY CONFUSED BY THE NUMBERS, AND THEN YOU GIVE UP, WHICH I DON'T WANT TO GIVE UP BECAUSE AS A BOARD MEMBER, IF SOMETHING GOES WRONG, THEY'LL COME TO US.
YOU KNOW, I RELY ON THE EXPERTS THAT ARE BONDS AND BUILDERS THAT KNOW.
BUT STILL, THIS PLAYING AROUND WITH THIS NUMBER SALAD, IT'S VERY, VERY DANGEROUS.
AND I WAS IN THE FEDERAL GOVERNMENT FOR 25 YEARS.
WHEN THE INSPECTOR GENERALS COME AT YOU, THEY DON'T CARE WHO RECOMMENDED IT TO YOU.
THEY SAID YOU WERE THE BOARD MEMBER.
I DON'T LIKE THE IRS ON THE RECORD.
SO, MRS. FISHER, YOU SAID YOU DID NOT UPDATE YOUR GEO 702 AND 703, WHICH IS YOUR SCHEDULE TO COMPLETE, WHICH IS YOUR DRAWER UNTIL JUST RECENTLY. IS THAT CORRECT? SO ALL THIS TIME THAT YOU'VE HAD LET ME FINISH MY STATEMENT.
ALL THIS TIME YOU'RE BUILDING THIS PROJECT AND YOU HAVE NOT UPDATED YOUR COST TO COMPLETE UNTIL WHEN, MISS MORALES SAID JUST RECENTLY. SO WE'RE JUST ROLLING.
WE'RE SPENDING MONEY. WE'RE ENJOYING IT.
OH, NOW WE GOT TO LOOK AT THE ACCOUNTING AND WE'VE OVERSPENT.
IS THAT IS THAT THE IS THAT WHAT YOU'RE TELLING THIS BOARD THAT.
WELL, WE DID NOT UPDATE THE DRAW FORM THE LENDERS, THE INVESTORS, OUR ACCOUNTING TEAM.
WE KNEW HOW MUCH WE WERE SPENDING.
WE'VE WE'VE INCURRED 36 MILLION YOU KNOW, TO DATE WHICH IS ABOUT 67%.
SO IT'S NOT LIKE WE WERE HIDING THE BALL AT ALL.
WE BELIEVED EVERYONE UNDERSTOOD WHERE WE WERE.
[02:25:04]
YOU KNOW, THEY'VE GOT, YOU KNOW, AS, AS TODAY FOR AS AN EXAMPLE, IT SAYS ONLY 67%, WHICH IS EXACTLY WHERE WE ARE.I MEAN, THE I GUESS MY POINT IS TO RESTATE, THE INSPECTION REPORTS WERE CLEARLY SAYING IT'S GOING TO COST A LOT MORE THAN WHAT THE G 702 IS SAYING, BUT THE G 702 IS A FUNCTION OF YOUR COST CONTROL AS THE BUILDER AND AS THE DEVELOPER TO MANAGE YOUR COST.
AND NOW WE'RE GETTING TO THE POINT HERE AT THE END TO SAY, HEY, WE'VE COMPLETELY BLOWN OUR COST.
AND MAGICALLY, IT TURNS OUT TO BE $55 MILLION ON THE NOSE AT THE END.
AND WE HAVE PLAYGROUNDS IN THE MIDDLE OF IT, WHICH ARE NOT GOING TO BE ON THE PROJECT.
THERE ARE NO PLAYGROUNDS IN A SENIOR ROLE.
THE PLAYGROUND IS IN YOUR COST TO COMPLETE.
WELL, THE G 702 IS JUST A FUNCTION.
I KNOW EXACTLY WHAT THE G702, BUT JUST IT'S IN GENERAL LIKE THAT'S JUST A BLANKET.
IT'S JUST I KNOW EXACTLY WHAT A COST TO COMPLETE SCHEDULE IS.
YOUR COST COMPLETE DOES NOT MATCH YOUR BUDGET, AND IT DOESN'T MATCH.
AND YOU'RE THE DEVELOPER AND THE GC.
YOU'RE NOT MANAGING YOUR WORK, RIGHT.
I DON'T UNDERSTAND WHY YOU'RE NOT MANAGING THE WORK ON THE COST.
TELL ME WHY YOU'RE NOT DOING THAT. WELL, I BELIEVE WE ARE.
AND FOR YOU TO SUGGEST THAT JUST BECAUSE THE G 702 DRAW FORM, THAT'S NOT OUR BUDGET.
WHAT YOU DID IN THE VERY BEGINNING.
RIGHT? SO YOU TOLD US IT'S GOING TO COST $50 MILLION.
YOU'VE BEEN RUNNING ON THE $50 MILLION THE ENTIRE TIME UNTIL TODAY.
THE DRAW FORM WAS NOT UPDATED UNTIL LAST MONTH.
THAT DOESN'T MEAN THAT WE'RE RUNNING AT THE ORIGINAL CONTRACT AMOUNT.
I MEAN, WE HAVE WE HAVE SOFTWARE, WE HAVE BUDGETING SYSTEMS. I MEAN, YOU'RE JUST REFERRING TO THE G 704, WHICH I UNDERSTAND, BUT THAT'S JUST THE DRAW FORM.
OKAY. AND I'M TRYING TO EXPLAIN THAT THE INVESTORS AND THE LENDERS AND AND EVERYONE WAS UNDERSTANDING OF WHERE THE BUDGET WAS GOING, HOW MUCH WE HAD INCURRED.
WE WERE DOING THE SAME TRYING TO REBID ALL THE WORK, TRYING TO GET OUR COSTS DOWN BECAUSE AS OUR SUBS WOULD COME TO US WITH CHANGE ORDERS, WE'D SAY, OKAY, CAN WE LET THIS ONE GO? CAN WE FIND SOMEONE ELSE TO DO THE WORK FOR LESS? ARE THEY TAKING ADVANTAGE OF US? I MEAN, IT'S A PROCESS AND WE ARE CONTINUOUSLY TRYING TO BID THE WORK DOWN.
I MEAN, IF THIS WERE HAPPENING TO YOU, WOULDN'T YOU BE WORKING IN THE BACKGROUND, TRYING TO REBID YOUR PROJECT IF PEOPLE WERE SHOWING YOU RIDICULOUS NUMBERS, WHICH YOU'RE SEEING TODAY FROM YOUR PERSPECTIVE? WE WERE SEEING THE SAME THING, WHICH IS WHY WE WERE CONTINUOUSLY WORKING, WHICH IS WHY IT WASN'T FINALIZED UNTIL SEPTEMBER.
WE WEREN'T READY TO ACCEPT THE NUMBERS THAT WE WERE GETTING.
SO WE CONTINUED TO WORK TO PUSH THOSE NUMBERS DOWN.
BUT. RESPECTFULLY, WE WEREN'T JUST WORKING ON THE 50 WITH BLINDERS.
MR. MORRISON, HOW MANY DIFFERENT HOW MANY UNITS ARE YOU MANAGING NOW? IN TOTAL, WE'VE DEVELOPED 10,000.
NOW, HOW MANY DO YOU HAVE YOUR FINGERPRINTS ON IN CONSTRUCTION RIGHT NOW? OH, RIGHT NOW, I'M SORRY.
TWO IN AUSTIN, ONE IN LOUISIANA, ONE IN FORT WORTH.
OKAY, SO THIS IS A QUESTION FOR FOR STAFF.
SO WE'RE WE'RE KIND OF PUT IT AS A BOARD, PUT IN A POSITION OF EITHER APPROVING THIS, WHICH WILL THEN THEY'LL GET THEIR EXTENSIONS AND WE'LL APPROVE THIS, AND THEN THEY'LL PUT THESE UNITS INTO USE 60%.
AND WHAT'S THE 100%? WHAT WOULD BE THE MARKET VALUE? WHAT WOULD BE THE FAIR MARKET VALUE OF A RENTAL UNIT IN FORT WORTH? NO. IN THIS PROJECT.
OKAY. ARE YOU ASKING WHAT THE AREA MEDIAN INCOME IS OR NO MARKET RATE.
YOU'RE GOING TO CHARGE FOR A MARKET RATE ON THIS UNIT.
OH YEAH I MEAN FORT WORTH IS ABOUT A $2 TO $2 AND 50 CENT MARKET IN TERMS OF RENT.
SO JUST IN GENERAL ABOUT 1600 TO $2000.
LIKE $1600 TO $2000 A UNIT A MONTH.
OKAY. SO YOU'RE EVEN IF YOU GO PRIVATE, YOU DON'T GET THIS, YOU STILL HAVE TAX EXEMPT.
YOU'RE NOT GOING TO PAY PROPERTY TAX, RIGHT? I GUESS YEAH THAT WOULD BE TRUE.
RIGHT. OR WE CAN GIVE THEM THE GO AHEAD AND THEY CAN PUT THESE UNITS INTO A 61, 60%, 100% 60.
[02:30:04]
RIGHT. IF WE APPROVE THIS OR.THAT'S WHAT I'M TRYING TO FIGURE OUT IS HOW HOW CONSEQUENTIAL OUR YES OR NO OR IS ON THIS.
60%? AM I IS THAT OKAY? CAN THEY JUST FLIP PRIVATE? I DON'T I DON'T THINK SO.
SO AT THAT POINT, IT ULTIMATELY HAS TO FLIP.
ANY MONEY THAT WAS ADVANCED BY THE INVESTOR WOULD HAVE TO BE REPLACED WITH PRIVATE.
SO THE THIS IS WHY IT'S SO IMPORTANT THAT THE $5 MILLION GETS US PAST THE 50% TEST.
AND JUST TO ANSWER, CONTINUE TO ANSWER YOUR QUESTION, IS THE G7 OH TWO DID NOT CONTINUE TO GO UP, BUT MONEY STILL FLOWED INTO THE PROJECT FROM THE PARTNERS, NOT FROM THE PARTNERSHIP LEVEL, BUT FROM THE OWNERSHIP LEVEL.
WORK HAS CONTINUED IN PLACE PAST WHAT THE LENDER AND INVESTOR HAVE PUT INTO THE DEAL.
LET ME ASK THE AND THIS MAY BE THE STAFF AS MUCH AS ANYBODY.
HOW OFTEN ARE THE CSRS ISSUED QUARTERLY.
QUARTERLY. AND WHEN IS THE PROJECT GOING TO BE COMPLETED? BY MARCH OF 2025.
WITH THE BUILDING ROLLING OUT IN NOVEMBER.
AND WE SHOULD EXPECT OCCUPANCY SHORTLY AFTER THAT.
MOVEMENTS. WELL, I'M JUST WHAT I'M GETTING AT IS WONDERING, DO WE HAVE TO SAY YES OR NO RIGHT NOW? I THINK THAT YOU ALL ARE REPRESENTING THAT DAY.
SO IF WE WAIT ANOTHER COUPLE OF MEETINGS.
BUT I GUESS IF YOUR OFFICIAL REPORT ISN'T UNTIL SO, JANUARY, BEGINNING OF JANUARY, RIGHT? MAYBE THAT'S IF IT WAS MONTHLY OR SOMETHING.
WE'LL BE FAR COMPLETE, FAR BEFORE THE NEXT LOTTERY, WHICH WOULD HAPPEN.
AND THE CONCERT HAS TO COME OUT AT SOME POINT AS WELL.
SO IT'S THAT THAT'S THE URGENCY.
AND WE ARE JUST TODAY VOTING TO BE CONSIDERED.
YOU GUYS ARE IN COMPLETE CONTROL AS THE ISSUER.
SO IF AT ANY POINT ONCE THERESA SEES THE CSR THAT WILL BE FILED TODAY, I MEAN, IF, IF IF YOU ALL DON'T LIKE IT, YOU PULL THE APPLICATION ANY TIME UP UNTIL WE CLOSE, WHICH WOULD BE IN MARCH, YOU HAVE 180 DAYS.
180 DAYS. SO YOU STILL HAVE SIX MONTHS TO CHANGE YOUR MINDS.
IF YOU DON'T LIKE WHAT YOU'RE SEEING, HAVE A QUESTION ABOUT RISE.
IS IT RISE DEVELOPMENT PARTNERS? IT'S RISE RESIDENTIAL CONSTRUCTION AND RISE WITH RISE BUILT IN PARTNERS.
OKAY. BUT WE HAVE AN RRC DEVELOPMENT, BUT NO PARTNERS.
IS THAT RELEVANT? THE WAY WE'RE DOING? NO.
AND INSTEAD WE CAN HAVE AN ORDER BASED ON OUR OWN SYSTEM OF HOW THOSE PROJECTS WILL THEN GET RESERVED TO THE COMMENT ABOUT THE PRIORITY ZERO.
IT KIND OF ALLUDES TO WHAT I MENTIONED IN MY PRESENTATION, WITH STATE LAW CHANGING TO ALLOW SUPPLEMENTAL PROJECTS TO BE THIS PRIORITY ZERO AND BE INCENTIVIZED TO FLOAT UP TO THE TOP. THE CAVEAT THERE, THOUGH, IS THEY HAVE TO COME BACK WITHIN FOUR YEARS OF WHEN THE ORIGINAL APPLICATION WAS FILED.
[02:35:03]
THIS TRANSACTION IS OUTSIDE OF THE FOUR YEARS, SO THEY WILL NOT BE A PRIORITY ZERO OR THEY DON'T QUALIFY.IS IT IS IT FILING OR IS IT CLOSING FILING.
SO THE BOARD, IF THEY WANTED MORE TIME THEY COULD TABLE THIS FOR A MONTH OR TWO.
THEY COULD. I MEAN AGAIN THE THE OCTOBER 18TH IS IT DOESN'T ACTUALLY APPLY TO THIS THIS PARTICULAR PROJECT.
CORRECT. YOU KNOW, WE'RE JUST TALKING ABOUT 0.4% TO GET TO THE 50%.
0.4% IS WHAT WE'RE LOOKING TO GET BASED ON THE NUMBERS THAT THEY PROVIDED.
THAT 50% TEST CALCULATION IS AT 49.6.
IT IS NOT UNCOMMON FOR TRANSACTIONS TO DECREASE THAT AGGREGATE BASIS NUMBER IN ORDER TO RISE ABOVE THE 50%, AND THAT COULD BE DONE THROUGH REDUCING GC FEE OR REDUCING DEVELOPER FEE IN ORDER TO GET ABOVE THE 49.6.
IS WITH THE ADDITIONAL 5 MILLION.
CORRECT. I WOULD FEEL MUCH MORE COMFORTABLE GETTING SOME MORE REPORTS DOWN THE ROAD.
I MEAN, MAYBE THE NEXT QUARTER REPORT AND THEN IF THERE IS SOMETHING WHERE WE'LL STAFF, I GUESS DEVELOPER WILL HAVE A BETTER CONFIDENCE LEVEL AS TO WHERE THE THE NUMBERS ARE ULTIMATELY PANNING OUT.
IF YOU KNEW YOU WERE COMING HERE TODAY AND YOU STILL OPTED TO NOT HAVE YOUR REPORT, AT LEAST WITH YOU TO SAY, IF WE'RE GOING TO FILE THIS TODAY, I HAVE IT ON MY LAPTOP.
WE'RE FILING TODAY, BUT THEY HAVE NOT SEEN IT.
RIGHT. STEPH'S NOT SAYING NO, IT HASN'T BEEN FILED.
BUT IF YOU KNOW THAT YOU'RE GOING TO BE HERE COMING TO US TODAY AND YOU HAVE THIS REPORT ON YOU WITH YOU TODAY, WHY DIDN'T YOU GIVE THEM THE REPORT YESTERDAY OR THE DAY BEFORE? WELL, BECAUSE RIGHT NOW YOU'RE ASKING US TO TALK ABOUT THINGS, BUT YOU ONLY YOU HAVE INFORMATION WE DON'T OR THE STAFF DOESN'T.
THE INFORMATION IN THAT REPORT, THEY HAVE AS PART OF THE APPLICATION SO THAT THAT G 702 THAT WE'VE BEEN TALKING ABOUT THAT YOU'RE FILING TODAY. CORRECT? CORRECT. IT IS CHANGE ORDER YOU HAVE HERE.
OH WELL, IT'S JUST GOING TO BE A DIFFERENT FORM OKAY.
I MEAN, MR. CHAIRMAN, I THINK FROM WHERE I SIT, I MEAN, THERE'S JUST A LACK OF CLEAR COMMUNICATION.
I MEAN, STAFF IS NOT COMFORTABLE.
THEY DON'T FEEL LIKE THEY HAVE ALL THE INFORMATION THEY NEED TO MAKE A RECOMMENDATION TO THE BOARD.
WE'RE SUPPOSED TO, IN ESSENCE, MAKE A RECOMMENDATION WITH A LOT OF INCOMPLETE INFORMATION AND LOTS OF MOVING PIECES TO THIS. I WOULDN'T BE COMFORTABLE GOING OVER STAFF'S NEUTRAL RECOMMENDATION, AND I WOULD WANT MORE TIME, AND I WOULD I WOULD BE SUPPORTIVE OF TABLING IT. OKAY, THE 18TH ISN'T AN ISSUE.
I THINK WE'RE ALL VERY WE'D LIKE TO SEE UPDATED INFORMATION AS WE KEEP GETTING CLOSER AND THEN BEING ABLE TO READDRESS WHERE THIS WHERE THIS LANDS, AND IT MIGHT NOT EVEN HAVE TO COME TO US, DEPENDING ON HOW ALL YOUR FINAL NUMBERS ARE GOING OUT.
SO. IT'S PROBABLY BEST FOR THE APPLICANT TO WALK AWAY WITH A TABLE FOR A FUTURE MEETING THAN ANY OTHER ALTERNATIVE VOTE THAT I WOULD IMAGINE WOULD OCCUR RIGHT NOW.
SO WOULD SOMEONE LIKE TO MAKE A MOTION TO TABLE THIS TO A FUTURE MEETING? I MOVE THE BOARD TABLE INDUCEMENT NUMBER 25 005 REGARDING THE APPLICATION SUBMISSION FOR BRB, POSSIBLE RECEIPT OF STATE VOLUME CAP, ISSUANCE OF A SUPPLEMENTAL BOND APPLICATION FOR LEGACY RIVER SENIOR LIVING AND COMMUNITY.
MOTION MADE BY MR. HARPER TO TABLE SECONDED BY MISS FARIAS.
AYE AYE. ANY OPPOSED? HEARING NONE. WE'LL SEE YOU DOWN THE ROAD.
IS IT MY UNDERSTANDING THAT ITEM 19 HAS BEEN PULLED FROM THE AGENDA? OKAY. JUST SO WE DON'T HAVE A LOT OF COMPLAINTS.
DO WE WANT TO TAKE A COUPLE MINUTES OR DO YOU WANT TO KEEP PLOWING THROUGH? KEEP GOING, KEEP PLOWING THROUGH.
IF ANYONE NEEDS TO LEAVE, YOU CAN.
[02:40:02]
AND I KNOW ONE OF YOU HAS A FLIGHT, SO.MOVING ON. PRESENTATION, DISCUSSION AND POSSIBLE ACTION REGARDING A WAIVER OF OF TEN TAX.
SECTION 11.9 B2A AND OWNERSHIP STRUCTURE CHANGE FOR ESTACADO ESTATES.
GOOD AFTERNOON. ROSALIO BANUELOS, DIRECTOR OF ASSET MANAGEMENT.
ESTACADO STATES RECEIVED A 9% HOUSING TAX CREDIT AWARD IN 2022 AND THE REALLOCATION OF TAX CREDITS UNDER FORCE MAJEURE IN 2023 FOR THE NEW CONSTRUCTION OF 46 UNITS OF ELDERLY HOUSING IN AMARILLO, RANDALL COUNTY.
THE APPLICATION FOR THE DEVELOPMENT RECEIVED TWO POINTS, BECAUSE THE DEVELOPMENT WAS STRUCTURED TO INCLUDE A HISTORICALLY UNDERUTILIZED BUSINESS OR HUB, AND THE OWNERSHIP STRUCTURE THAT WOULD HAVE SOME COMBINATION OF OWNERSHIP INTEREST IN THE GENERAL PARTNER OF THE APPLICANT.
CASH FLOW FROM OPERATIONS AND DEVELOPER FEE.
THE APPLICANT IS NOW REQUESTING APPROVAL FOR CHANGES TO THE OWNERSHIP STRUCTURE OF THE DEVELOPMENT, WHICH REQUIRES A WAIVER OF THE PROVISION THAT SPECIFIES THAT THE HUB IS REQUIRED TO HAVE AN OWNERSHIP INTEREST IN THE GENERAL PARTNER.
THE APPLICANT IS SEEKING TO REVISE THE OWNERSHIP STRUCTURE BY REPLACING THE GENERAL PARTNER AT THE TIME OF APPLICATION WITH THE NEW ENTITY, OF WHICH THE SOLE MEMBER IS THE PANHANDLE REGIONAL HOUSING FINANCE CORPORATION, AND MOVING THE CURRENT GENERAL PARTNER TO THE NEW ROLE OF SPECIAL LIMITED PARTNER.
THE PROPOSED NEW GENERAL PARTNER WILL ALSO BE A CO-DEVELOPER IN THE TRANSACTION.
ADDITIONALLY, TITLED TO THE FEE, INTEREST IN THE DEVELOPMENT SITE WILL BE TRANSFERRED TO THE PANHANDLE REGIONAL HOUSING FINANCE CORPORATION, WHO WILL THEN ENTER INTO A GROUND LEASE WITH THE APPLICANT.
THE APPLICANT EXPLAINED THAT DUE TO CONSTRUCTION COST INCREASES, INCREASES IN OPERATING EXPENSES, PARTICULARLY PAYROLL, INSURANCE AND PROPERTY TAXES, INCREASES IN INTEREST RATES AND DECREASES IN EQUITY PRICING, THE DEVELOPMENT IS NOT FEASIBLE WITHOUT SIGNIFICANT CHANGES.
THE REQUESTED CHANGES TO THE OWNERSHIP STRUCTURE, ALONG WITH THE GROUND LEASE STRUCTURE, WILL IMPROVE THE FINANCIAL FEASIBILITY OF THE DEVELOPMENT BY PROVIDING A PROPERTY TAX EXEMPTION. HOWEVER, THE CHANGE TO THE OWNERSHIP STRUCTURE WOULD RESULT IN THE HUB NO LONGER MEETING THE REQUIREMENTS FOR THE TWO POINTS AWARDED AT APPLICATION BECAUSE IT WILL NO LONGER BE IN THE OWNERSHIP STRUCTURE OF THE GENERAL PARTNER.
THEREFORE, THE APPLICANT REQUESTED A WAIVER OF THIS SPECIFIC REQUIREMENT AND TO ALLOW THE DEVELOPMENT TO CONTINUE TO QUALIFY FOR THE POINTS WITH THE HUB AND THE OWNERSHIP STRUCTURE OF THE SPECIAL LIMITED PARTNER.
IT SHOULD ALSO BE NOTED THAT ON JUNE 25TH, 2024, THE CITY OF AMARILLO PASSED A RESOLUTION IN WHICH IT ACKNOWLEDGES THE CHANGE OF THE DEVELOPMENT TO TAX EXEMPT AND REAFFIRMS ITS SUPPORT FOR THE DEVELOPMENT.
THIS RESOLUTION IS IN THE BOARD PACKET FOR THIS ITEM.
OKAY, SO THIS IS PRETTY MUCH STANDARD.
MOVING THE REVISING THE STRUCTURE USING THE SPECIAL LIMITED PARTNER.
AND THE CITY HAS EXPLICITLY APPROVED THE CHANGE TO THE NONPROFIT TAX EXEMPT.
DOES ANY BOARD MEMBER HAVE QUESTIONS ON THIS ITEM? IF NOT, I'LL. DOES ANYONE WANT TO SPEAK AGAINST THIS ITEM? OKAY. ALL RIGHT. I'LL ENTERTAIN A MOTION ON ITEM 20 OF THE AGENDA.
SECOND MOTION MADE BY MISS FARIA, SECONDED BY MR. HARPER. ALL THOSE IN FAVOR SAY AYE.
AYE. ANY OPPOSED? HEARING NONE. MOTION CARRIES.
THE COST CERTIFICATION DOCUMENTATION REQUESTS AN ANNUAL TAX RATE AWARD OF 3,021,497, WHICH IS AN INCREASE OF 01,401,154, OR 86.47% FROM THE AMOUNT REFLECTED IN THE DETERMINATION NOTICE.
A COMPARISON OF THE DEVELOPMENT COSTS FROM THE TIME OF APPLICATION IN 2019 TO THE COST CERTIFICATION, INDICATES THAT TOTAL DEVELOPMENT COSTS INCREASED APPROXIMATELY 19.7 MILLION, OR 42.84%, FROM A LITTLE UNDER 46 MILLION TO OVER 65 MILLION.
[02:45:07]
THE OWNER EXPLAINED THAT DIRECT CONSTRUCTION COSTS WERE UNDERESTIMATED AT THE TIME OF APPLICATION, AS THE APPLICANT DID NOT HAVE AN ACTUAL CONSTRUCTION BIDS AT THAT TIME.ADDITIONALLY, THERE WERE SEVERAL CHANGE ORDERS AND MATERIAL PRICE ESCALATIONS.
THERE WAS ALSO A NEED FOR MITIGATION FOR A WATER INFILTRATION ISSUE IN THE GARAGES.
GENERAL CONDITIONS AND OVERHEAD COSTS INCREASED DUE TO THE LENGTHENED SCHEDULE CAUSED BY CONSTRUCTION DELAYS, AND CONSTRUCTION DELAYS ALSO INCREASED THE CONSTRUCTION INTEREST. DEVELOPER FEE INCREASED 24%, BUT DID NOT GO ALL THE WAY UP TO THE 15% ALLOWED UNDER THE RULES.
IN ADDITION TO THE CHANGES IN COST, THE CREDIT CALCULATION AT APPLICATION WAS BASED ON AN APPLICABLE PERCENTAGE OF 3.42, BUT AT COST CERTIFICATION THE PERCENTAGE WAS ADJUSTED TO 4% DUE TO THE ENACTMENT OF THE CONSOLIDATED APPROPRIATIONS ACT OF 2021, AND DUE TO A SUPPLEMENTAL BOND THAT WAS FUNDED IN 2023 THROUGH A LOCAL ISSUER.
STAFF'S ANALYSIS OF THE TRANSACTION COST CERTIFICATION HAS CONCLUDED THAT THE DEVELOPMENT SUPPORTS THE REQUEST THAT ANNUAL TAX CREDIT AMOUNT OF 3,021,497 AND STAFF RECOMMENDS APPROVAL OF THE INCREASE IN THE TAX CREDIT AWARD.
HOWEVER, THE OWNER WILL BE REQUIRED TO SUBMIT THE TAX EXEMPT BOND CREDIT, INCREASE REQUEST FEE AS REQUIRED IN THE CAP, AND SUBMIT ALL REQUIRED PENDING DOCUMENTATION FOR THE CERTIFICATION PRIOR TO THE ISSUANCE OF 86.9.
THAT CONCLUDES MY PRESENTATION.
THIS WAS ORIGINALLY A 2019 DEAL.
YES. AND AT THIS POINT, AGAIN, IT'S ALL BEEN IT'S COMPLETE.
IT'S WE'RE JUST DOING THE FINAL COST NUMBERS.
CORRECT. THIS IS ALL BASED ON FINAL NUMBERS.
OKAY. SO IT'S IT'S A DONE DEAL.
DO ANY BOARD MEMBERS HAVE QUESTIONS ON THIS? SCENE. AND STAFF RECOMMENDS APPROVAL.
SO I'LL ENTERTAIN A MOTION ON ITEM 21 OF THE AGENDA.
IS THERE A SECOND? SECOND. SECOND BY MISS CONROY.
AYE. ANY OPPOSED? HEARING NONE. MOTION CARRIES.
PRESENTATION, DISCUSSION AND POSSIBLE ACTION ON.
REGARDING APPROVAL OF A HOME ARP ALLOCATION PLAN.
SECOND AMENDMENT TO ADD REALLOCATED FUNDS TO THE NONPROFIT CAPACITY BUILDING SLASH OPERATING COST ASSISTANCE, NON-CONGREGATE SHELTER ACTIVITIES AND ADMINISTRATION ACTIVITIES TO BE RELEASED FOR PUBLIC COMMENT.
IN 2021, TDHCA WAS ALLOCATED ABOUT 132 MILLION FOR THE HOME AMERICAN RESCUE PLAN, ALSO KNOWN AS HOME ARP HOME ARP TARGET POPULATION IS PERSONS EXPERIENCING HOMELESSNESS AT RISK OF HOMELESSNESS AND OTHER AT RISK POPULATIONS.
OUR DIVISION BUDGETED FUNDS INTO THREE PROGRAM ACTIVITIES NON-CONGREGATE SHELTER DEVELOPMENT, RENTAL HOUSING DEVELOPMENT AND NONPROFIT CAPACITY BUILDING AND OPERATING FUNDS.
SINCE PROGRAMING, THE HOME ARP DIVISION AWARDED ALL OF ITS RENTAL DEVELOPMENT FUNDS AND AWARDED OR REALLOCATED A MAJORITY OF ITS NONPROFIT CAPACITY BUILDING AND OPERATING FUNDS.
WE ALSO HAVE AN OPEN INVITATION TO APPLY FOR NON-CONGREGATE SHELTER.
THERE HAVE BEEN TWO FEDERAL ADJUSTMENTS MADE TO THE ORIGINAL HOME-ARP ALLOCATION.
HUD NOTIFIED US IN 2023 THAT OUR FUNDS WERE REDUCED BY ABOUT $3.8 MILLION DUE TO DUE TO THEIR REALLOCATION DUE TO THEIR ALLOCATION ERROR IN AUGUST 2024, HUD REALLOCATED APPROXIMATELY 4.3 MILLION TO TDHCA FROM PLACES IN TEXAS THAT DID NOT PROGRAM THEIR HALLMARK FUNDS.
THIS IS ODESSA, BRYAN, AND PASADENA.
I'M BEFORE YOU TODAY TO REQUEST THAT THE REALLOCATED FUNDS BE PROGRAMED INTO NONPROFIT, CAPACITY BUILDING, OPERATING ASSISTANCE, NON-CONGREGATE SHELTER DEVELOPMENT, AND TDHCA ADMINISTRATION.
[02:50:04]
THE HOME-ARP TEAM ANTICIPATES CONTINUING WITH THE STRATEGY OF RELEASING CAPACITY BUILDING OPERATING FUNDS TO SUPPORT ONE OR MORE NONPROFITS THAT PLAN TO UNDERTAKE NON-CONGREGATE SHELTER WITH A PREFERENCE FOR ODESSA, BRYAN AND PASADENA AS REQUIRED FOR HUD BY HUD.BY ALSO ADDING APPROXIMATELY 3 MILLION IN REALLOCATED FUNDS INTO OUR OPEN NON-CONGREGATE SHELTER.
THE SECOND, THE ATTACHED SECOND AMENDMENT, REFLECTS THE HUD APPROVED HALLMARK PLAN AND FIRST AMENDMENT, WITH TRACK CHANGES REFLECTING THE PROPOSED SECOND AMENDMENT LANGUAGE. THERE'S ONE CHANGE I'M GOING TO REQUEST VIA THE SPEAKING NOTES ON PAGE 49 OF THE DRAFT SECOND AMENDMENT.
WE HAVE STATED THAT THE NONPROFIT CAPACITY BUILDING OPERATING FUNDS WOULD BE AWARDED TO AN ORGANIZATION THAT WOULD EXPAND 40% OF THE FUNDS BY MONTH, 24 OF THE CONTRACT, AND 100% OF THE FUNDS BY MONTH 48.
WE REQUEST TO CHANGE THIS TO AWARD AN ORGANIZATION THAT COULD EXPEND 40% OF THE FUNDS BY MONTH, 18 OF THE CONTRACT, AND 100% OF THE FUNDS BY MONTH 36.
THIS CHANGE IS REQUESTED SO WE CAN SUPPORT THE ORGANIZATION THROUGHOUT THE APPLICATION AND CONSTRUCTION OF THE NON-CONGREGATE SHELTER, AND FURNISH ASSISTANCE WITH THE ANTICIPATED COMPLETION OF THE SHELTER.
UPON APPROVAL BY THE BOARD, STAFF WOULD PUBLISH THE AMENDMENT FOR A COMMENT FOR 15 DAYS IF NO CHANGES WILL BE MADE AS A RESULT OF PUBLIC COMMENT, WE ASK THE AUTHORITY FOR THE EXECUTIVE DIRECTOR TO PROCEED WITH SUBMISSION TO HUD AS PRESENTED HERE AND WITH THE CHANGE REQUESTED IN SPEAKING NOTES.
OKAY. SO THEY'RE THEY MADE A MISTAKE ON 3.8 MILLION.
THEY DID. BUT THAT WAS YOUR HUD WAS VARIOUS HUD FUNDS.
BUT NET WE'RE ACTUALLY GETTING MORE ALLOCATED WITH ALL THESE DIFFERENT PROGRAMS. THAT'S CORRECT. THE NET CHANGE IS ABOUT 508,000.
I MEAN, PULLING BACK FUNDS FROM ANYONE THAT WE HAD AWARDED THEM TO, OF THAT 3.8.
DOES ANYONE HAVE QUESTIONS FOR MISS CANTU? HEARING NONE.
I'LL ENTERTAIN A MOTION ON ITEM 22 OF THE AGENDA.
I MOVE THAT THE BOARD APPROVE THE PROPOSED SECOND AMENDMENT TO THE HOME ARP ALLOCATION PLAN.
SECOND. SUBJECT TO THE SUBJECT TO THE SMALL MODIFICATION.
MOTION MADE BY MR. HARPER, SECONDED BY MISS FARIAS.
AYE. ANY OPPOSED? HEARING NONE. MOTION CARRIES.
THANKS, NAOMI. I AM 23 OF THE AGENDA.
PRESENTATION, DISCUSSION AND POSSIBLE ACTION REGARDING THE ADOPTION OF AN AGREED FINAL ORDER CONCERNING URBAN VILLAGE ONE AND YVONNE VILLAGE TWO.
LET'S HAVE A CONCISE PRESENTATION HERE.
GOOD AFTERNOON, SASHA STREMLER.
HERE, IN MY CAPACITY AS ASSISTANT GENERAL COUNSEL TO PRESENT ITEM 23 REGARDING AGREED.
FINAL ORDERS FOR URBAN VILLAGE ONE AND URBAN VILLAGE TWO.
ALVIN JOHNSON IS THE PRESIDENT OF HOPE HOUSING FOUNDATION AND IS THE PRIMARY CONTACT WITH TDHCA.
165 OF THESE UNITS ARE RESTRICTED BY THE HOUSING TAX CREDIT PROGRAM.
URBAN VILLAGE ONE IS SUBJECT TO A 1997 ERA, AND VILLAGE TWO IS SUBJECT TO A 2002 ERA.
OWNERSHIP PURCHASED THE PROPERTY IN 2013.
[02:55:05]
THE DEPARTMENT ALSO PERFORMS INSPIRE INSPECTIONS.BOTH TYPES OF REVIEW REQUIRE OWNERS TO SUBMIT CORRECTIVE DOCUMENTATION WITHIN 90 DAYS.
HOPE HOUSING FOUNDATION HAS THREE FINAL THREE PRIOR AGREED FINAL ORDERS.
THERE ARE TWO FROM 2017 WHICH WHICH THE OWNER COMPLIED WITH.
THERE WAS A 2018 AGREED FINAL ORDER FOR RIDGE AT TRINITY.
THE OWNER VIOLATED THAT ORDER AND ENDED UP PAYING THE FULL PENALTY.
SO ALL OF THE ALL OF THE PROPERTIES IN THEIR PORTFOLIO HAVE BEEN REFERRED AT SOME TIME.
BOTH WERE REFERRED TO ENFORCEMENT COMMITTEE FOR AN ADMINISTRATIVE PENALTY ON JUNE 10TH, 2024 TDC'S COMPLIANCE DIVISION IDENTIFIED THE FOLLOWING FINDINGS OF NONCOMPLIANCE THAT WERE NOT TIMELY CORRECTED AND ARE UNDER CONSIDERATION TODAY FOR AN ADMINISTRATIVE PENALTY.
FOR ONE, THERE WERE INSPIRED FINDINGS OF NONCOMPLIANCE.
THOSE WERE RESOLVED AFTER REFERRAL.
FOR TWO, THERE WAS A FAILURE TO IMPLEMENT UPDATED UTILITY ALLOWANCES.
NO HOUSEHOLDS WERE DESIGNATED AS SPECIAL NEEDS UNITS, AND THERE WERE TWO INSTANCES WHERE PROGRAM UNITS WERE NOT LEASED TO LOW INCOME HOUSEHOLDS, AND NONE OF THE ITEMS FOR YVONNE TWO HAVE BEEN RESOLVED AS OF THIS TIME.
ADMINISTRATIVE PENALTIES ARE AUTHORIZED BY STATUTE AT TEXAS GOVERNMENT CODE SECTION 02,306.041.
THE PROCESS IS DEFINED BY RULE AT TINTIC, CHAPTER TWO, SUBCHAPTER C.
TO ASSESS A PENALTY, TDCJ MUST FIRST OFFER AN INFORMAL CONFERENCE.
THE ENFORCEMENT COMMITTEE HELD AN INFORMAL CONFERENCE WITH OWNER ON AUGUST 29TH, 2024, AND ANALYZED THE REQUIRED STATUTORY FACTORS FOR DETERMINING AN APPROPRIATE ADMINISTRATIVE PENALTY. THOSE FACTORS ARE DISCUSSED IN FURTHER DETAIL IN YOUR BAR MATERIALS.
THE ENFORCEMENT COMMITTEE DETERMINED THAT A HIGH ADMINISTRATIVE PENALTY WAS APPROPRIATE, GIVEN THE OWNER'S PRIOR VIOLATION OF A PAST AGREED FINAL ORDERS, AND THE COMMITTEE ALSO RECOMMENDED TO ALLOW A PORTION TO BE FORGIVABLE TO INCENTIVIZE CORRECTIONS.
THE ENFORCEMENT COMMITTEE THEREFORE RECOMMENDED AN ADMINISTRATIVE PENALTY OF $23,125, WHICH IS THE MAXIMUM PENALTY FOR URBAN VILLAGE ONE AND URBAN VILLAGE TWO, WITH A 50% FORGIVABLE PORTION TO BE PRORATED AND FORGIVEN AS FOLLOWS.
SECOND, THE OWNER MUST CORRECT ALL FILE MONITORING VIOLATIONS AS INDICATED IN THE AGREED FINAL ORDER, AND SUBMIT FULL DOCUMENTATION OF THE CORRECTIONS TO TDA ON OR BEFORE NOVEMBER 12TH, 2024.
THIRD, IF IF THE OWNER COMPLIES WITH ALL THESE REQUIREMENTS AND ADDRESSES ALL VIOLATIONS, THEN THE REMAINING 50% WOULD BE FORGIVEN IF THE OWNER VIOLATES ANY PROVISION OF THE AGREED FINAL ORDER, THE FULL ADMINISTRATIVE PENALTY WILL BECOME IMMEDIATELY DUE AND PAYABLE.
I'M AVAILABLE FOR ANY QUESTIONS.
OKAY, SO THIS HAS BEEN A THEY HAVE A HISTORY OF NONCOMPLIANCE OR OR ISSUES.
CORRECT. AND WE'VE COME UP TO AN AGREED 23,023 23,125, WHICH IS IF YOU'RE LOOKING AT THE CALCULATIONS, THAT'S THE MAXIMUM PENALTY AVAILABLE.
BUT HALF IS GOING TO DEPEND ON WHETHER THEY COMPLY.
THIS IS THE ACTUAL REAL PENALTIES BEING ASSESSED.
I'M JUST NOT GOING TO DO IT. IT'S CHEAPER.
IT'S JUST CHEAPER FOR ME TO PAY THE PENALTY.
WHAT HAPPENS TO HIM IF HE JUST SAYS, HEY, HERE'S I'M PAYING THE PENALTY.
BUT THE CHANGES, THE COST OF THE CHANGE IS FAR EXCEEDS THE PENALTY.
THE ALL THEY'RE REQUIRED TO DO IS PAY THE MAXIMUM PENALTY.
THEY DON'T HAVE ENOUGH PROPERTIES IN THEIR PORTFOLIO TO TRIGGER DEBARMENT.
[03:00:03]
YEAH. IT WOULD COME BACK. YEAH.YOU NEVER IT'S NEVER GOING TO PAY OFF TO JUST SAY OH NEVER MIND.
OKAY. BECAUSE YOU HAVEN'T FIXED ANYTHING.
GOTCHA. OKAY. SO HE WOULD BE SUBJECT AGAIN FOR ANOTHER FINE AND ETC.
OKAY. ANY FURTHER QUESTIONS? IF NOT, I'LL ENTERTAIN A MOTION.
A MOTION ON ITEM 23 OF THE AGENDA.
MR. CHAIRMAN, I MOVE THE BOARD, APPROVE THE AGREED FINAL ORDER ASSESSING AN ADMINISTRATIVE PENALTY FOR NONCOMPLIANCE AT URBAN VILLAGE ONE AND URBAN VILLAGE TWO.
SECOND. MOTION MADE BY MISS FARIA, SECONDED BY MR. HARPER. ALL THOSE IN FAVOR SAY AYE.
AYE. ANY OPPOSED? HEARING NONE. MOTION CARRIES.
TRIPLEX. MR. STREMLER. SASHA STREMLER, ASSISTANT GENERAL COUNSEL.
TRIPLEX CONSISTS OF THREE SCATTERED SITE, FOUR BEDROOM, SINGLE FAMILY HOMES THAT ARE LOCATED IN PLAINVIEW, HALE COUNTY, TEXAS, WHICH ARE RESTRICTED AT 50% OF AMI. THE PROPERTY WAS SUBJECT TO A 1994 LURA IN EXCHANGE FOR AN INTEREST FREE LOAN.
CINDY CARTHEL IS THE HOUSING AUTHORITY'S EXECUTIVE DIRECTOR AND FDA'S PRIMARY CONTACT.
THE HOUSING AUTHORITY'S BOARD IS NOT ACTIVE, AND UNTIL RECENTLY, MISS CARTHEL WAS ITS ONLY EMPLOYEE.
THE DEFINITIONS ARE AVAILABLE AT EXHIBIT ONE FOR YOUR REFERENCE.
THE RESPONSIBLE PARTIES ARE NOT ARE NOT APPEALING THE DEBARMENT.
THE FIRST IS FAILURE TO COMPLY WITH AN AGREED FINAL ORDER UNDER ATTACK.
2.4016 THE DEPARTMENT MAY DEBAR RESPONSIBLE PARTY FOR FAILING TO CORRECT EVIDENCE OF NONCOMPLIANCE, AS REQUIRED BY AN ORDER THAT BECOMES EFFECTIVE AFTER APRIL 1ST, 2021, AND OR FAILING TO PAY AN ADMINISTRATIVE FEE AS REQUIRED BY SUCH ORDER, WITHIN SIX MONTHS OF A DEMAND BEING ISSUED BY THE DEPARTMENT.
ON FEBRUARY 2ND, 2023, CINDY CARTHEL SIGNED AN AGREED FINAL ORDER ON BEHALF OF HALE CENTER HOUSING AUTHORITY, AGREEING TO CORRECT NONCOMPLIANCE FROM A MARCH 1ST, 2022 FILE MONITORING REVIEW.
HALE CENTER HOUSING AUTHORITY VIOLATED THE ORDER, AND TDA ISSUED A COLLECTION LETTER ON APRIL 28TH, 2023, DEMANDING PAYMENT OF THE ADMINISTRATIVE PENALTY AND CORRECT AND CORRECTIVE ACTION WITHIN 30 DAYS.
THE SECOND BASIS IS HAVING UNRESOLVED NONCOMPLIANCE AT THE LEURA.
THE DEPARTMENT MAY DEBAR A RESPONSIBLE PARTY FOR CONTROLLING A MULTIFAMILY DEVELOPMENT AND FAILING TO CORRECT EVIDENCE AND EVENTS OF NONCOMPLIANCE BEFORE THE EXPIRATION OF LEURA, THE LEURA.
THERE IS NO REQUIRED MINIMUM OR MAXIMUM DEBARMENT TERM.
THE ENFORCEMENT COMMITTEE REACHED ITS RECOMMENDATION BASED ON THE MATERIAL FACTORS OUTLINED UNDER TAC 2.4 01J, WHICH INCLUDE REPEATED OCCURRENCES, SERIOUSNESS OF UNDERLYING ISSUES, AND PRESENCE OR ABSENCE OF CORRECTIVE ACTION, WHICH ARE DETAILED IN THE BAR.
I'M HAPPY TO ANSWER ANY QUESTIONS.
YOU SAID THERE'S NO BOARD, NO BOARD OF DIRECTORS.
IS THIS THE KIND WHERE A MAYOR APPOINTS BOARD OF COMMISSIONERS.
I AM NOT SURE, BUT I KNOW THAT IT'S A VERY SMALL HOUSING AUTHORITY.
OKAY. SINCE THEY ARE GOING TO BE DEBARRED FOR SO LONG, ARE THEY GOING TO PLACE THAT NOTICE ON THEIR BULLETIN BOARD? I KNOW AT THE NATIONAL LABOR RELATIONS BOARD, IF WE RULED AGAINST THE CORPORATION OR THE UNION BY LAW, THEY HAD TO POST THAT NOTICE FOR 15
[03:05:07]
DAYS. SO I KNOW WHO'S RUNNING IT.IT'S JUST THE EXECUTIVE DIRECTOR, CINDY CARTHEL, WHO'S ALSO BEING DEBARRED.
AND AGAIN, THIS IS A TINY UNIT.
IT'S NOT EVEN REALLY A DEVELOPMENT.
MR. HARPER, DO YOU WANT TO MAKE A MOTION? I MOVE THE BOARD, APPROVE THE FINAL ORDER FOR DEBARMENT FOR A TERM OF TEN YEARS FOR HALE CENTER HOUSING AUTHORITY AND CINDY CARTER HAS DESCRIBED AUTHORIZE AND CONDITION AND THE BOARD ACTION REQUEST RESOLUTION AND ASSOCIATED DOCUMENTS ON THIS ITEM.
SECOND MOTION MADE BY MR. HARPER, SECONDED BY MR. FARIAS. ALL THOSE IN FAVOR SAY AYE.
AYE. ANY OPPOSED? HEARING NONE. MOTION CARRIES.
THANK YOU. SASHA. ITEM 25 OF THE AGENDA PRESENTATION, DISCUSSION AND POSSIBLE ACTION ON PROGRAM YEAR 2024. EMERGENCY SOLUTIONS GRANTS PROGRAM AWARDS.
GOOD AFTERNOON. BOARD MEMBERS.
ROSIE FALCONE, MANAGER OF HOMELESS PROGRAMS. I WILL BE PRESENTING THE PROGRAM YEAR 2024 AWARD RECOMMENDATIONS FOR THE EMERGENCY SOLUTIONS GRANTS PROGRAM, OR ESG.
HOMELESS PREVENTION ACTIVITIES.
THE TOTAL AWARDS RECOMMENDED TODAY ARE JUST UNDER 9.3 MILLION, AND INCLUDE THE ENTIRETY OF THE ESG ALLOCATION, AFTER 4.5% OF THE FUNDS ARE SET ASIDE FOR THE ADMINISTRATION OF THE GRANT BY THE DEPARTMENT.
ESG RULES ALLOW A PROCESS FOR LONG TERM, HIGH PERFORMING SUBRECIPIENTS OF ESG TO RECEIVE A CONTINUING AWARD, AND ALSO ESTABLISH THE REQUIREMENTS FOR THE COMPETITION FOR THE REMAINING OF THE COMPETITIVE FUNDS.
DURING THIS APPLICATION CYCLE, THE TIEBREAKER NUMBER WAS USED WITHIN ONLY THE SAN ANTONIO COC.
THE DEPARTMENT DID RECEIVE TWO APPEALS.
THE APPLICANTS DID NOT SUBMIT AN APPEAL TO BE HEARD BY THE BOARD.
SHOULD THESE APPLICANTS NOT MEET THE CONDITION, FUNDS WILL BE REDISTRIBUTED TO OTHER ESG SUBRECIPIENTS IN ACCORDANCE WITH ESG RULES NOTED AT TINT, CHAPTER SEVEN. A DETAIL OF THE APPLICATIONS FOR BOTH CONTINUING AND COMPETITIVE AWARDS ARE INCLUDED AS ATTACHMENTS TO THIS ITEM.
THAT CONCLUDES MY PREPARED REMARKS.
I'M HAPPY TO ANSWER ANY QUESTIONS.
GREAT. SO ANOTHER 9 MILLION PLUS THAT WE'RE GETTING OUT THERE DISTRIBUTED, RIGHT? EXCELLENT. THE BOARD MEMBERS HAVE QUESTIONS ON THIS ITEM.
IF NOT, I'LL ENTERTAIN A MOTION ON ITEM 25 OF THE AGENDA.
I MOVE THE BOARD, APPROVE THE RECOMMENDED ESG PROGRAM FUNDING AWARDS AS DESCRIBED, AUTHORIZING CONDITION, THE BOARD ACTION REQUEST RESOLUTION AND ASSOCIATED DOCUMENTS ON THIS ITEM. MOTION MADE BY MR. HARPER, SECONDED BY MR. MARTIN. ALL THOSE IN FAVOR SAY AYE.
AYE. ANY OPPOSED? HEARING NONE. MOTION CARRIES.
PRESENTATION, DISCUSSION AND POSSIBLE ACTION TO RATIFY STAFF'S ACTIONS TO ACCEPT AND IMPLEMENT THE RAPID UNSHELTERED SURVIVOR HOUSING ALLOCATION UNDER THE ESG PROGRAM, AND TO RATIFY STAFF SUBMISSION OF AN AMENDMENT TO THE TEXAS STATE OF TEXAS 2023 ONE YEAR ACTION PLAN REFLECTING SUCH ACTION.
THAT'S A LOT. ROSIE FALCONE, HOMELESS PROGRAMS MANAGER.
[03:10:01]
THIS NEXT ITEM FOR YOUR CONSIDERATION IS A NEW AWARD THE DEPARTMENT DID RECEIVE FOR RESPONSE TO DISASTER RECOVERY.SO THERE ARE SEVERAL THINGS WE'RE ASKING THAT I'LL BE PRESENTING ON TODAY.
FIRST, ON JULY 18TH, HUD RELEASED A FEDERAL REGISTER NOTICE ANNOUNCING THE CREATION OF A NEW FORM OF DISASTER RELIEF THAT ALLOCATES SPECIAL GRANTS UNDER THE EXISTING EMERGENCY SOLUTIONS GRANTS PROGRAM, WHICH HUD HAS DESIGNATED AS THE RAPID UNSHELTERED SURVIVOR HOUSING PROGRAM, OR RUSH FUNDS.
THE ESG RUSH ALLOCATIONS ARE FUNDED BY RECAPTURED FUNDS FROM THE ESG AND THE CONTINUUM OF CARE, OR CFC PROGRAMS, AND ARE MADE AVAILABLE TO STATES AND OR LOCAL GOVERNMENTS TO ADDRESS THE NEEDS OF INDIVIDUALS AND FAMILIES WHO ARE EXPERIENCING HOMELESSNESS OR AT RISK OF EXPERIENCING HOMELESSNESS, BUT WHO ALSO RESIDE IN A DECLARED DISASTER AREA WHOSE NEEDS ARE NOT OTHERWISE ADDRESSED OR FULLY MET BY EXISTING DISASTER FUND.
ESG RUSH FUNDS MAY BE USED TO ADDRESS SHORT TERM DISASTER RESPONSE NEEDS, AS WELL AS ACTIVITIES FEDERALLY ELIGIBLE UNDER THE ANNUAL ESG PROGRAM, INCLUDING STREET OUTREACH, EMERGENCY SHELTER, HOMELESS PREVENTION, RAPID REHOUSING AND MISS.
THE STATE HAS RECEIVED AN INITIAL ALLOCATION OF $1.8 MILLION IN RESPONSE TO HURRICANE BERYL AND OTHER SEVERE WEATHER EVENTS IN THE STATE THROUGHOUT THIS YEAR. ALTHOUGH HUD WAIVED THE THE CONSULTATION REQUIREMENTS FOR THE INITIAL ALLOCATION OF FUNDING.
HUD REGULATIONS STILL REQUIRE THAT THE DEPARTMENT SUBMIT AN AMENDMENT TO THE 2023 STATE OF TEXAS ONE YEAR ACTION PLAN, OR OEP, WITHIN 30 DAYS OF HUD'S AWARD NOTIFICATION, WHICH WAS DATED AUGUST 28TH, 2024.
THE OIIP AMENDMENT ASKS SUBMITTED TIMELY TO HUD IS INCLUDED AS AN ATTACHMENT TO THIS ITEM AS WELL, TO EXPEDITE THE RELEASE OF FUNDS INTO AFFECTED COMMUNITIES. STAFF IS REQUESTING TO AWARD ESG RUSH FUNDS AS NEW CONTRACTS TO EXISTING HIGH PERFORMING ESG SUBRECIPIENTS, WHICH PROVIDE SERVICES WITHIN THE AFFECTED AREAS.
ATTACHMENT A OF THIS ITEM INDICATES THE AFFECTED AREAS BY REGION, AS THESE FUNDS ARE MEANT TO ADDRESS THE IMMEDIATE NEEDS ARISING FROM A DISASTER AND ARE GOVERNED BY ESG REGULATIONS.
IN ADDITION TO THIS REQUEST, STAFF IS ALSO REQUESTING A WAIVER OF TEN TAG CHAPTER TEN TAX 7.3 A, WHICH PROHIBITS THE USE OF ESG FUNDS FOR NEW CONSTRUCTION, RENOVATION, REHABILITATION, OR CONVERSION OF A SHELTER OR CONSTRUCTION OR REHABILITATION OF A DWELLING UNIT.
THIS WAIVER WILL ALLOW THE USE OF THE USE OF ESG RUSH FUNDS TO REHABILITATE EMERGENCY SHELTERS, WHICH MAY BE DAMAGED BY THE DISASTERS AND MAYBE NOT FULLY COVERED BY INSURANCE OR OTHER DISASTER RELATED FUNDS.
LASTLY, THE HUD NOTICE INCLUDES THE POSSIBILITY OF A SECOND ALLOCATION OF ESG RUSH FUNDING.
AS THESE FUNDS ARE MEANT TO ADDRESS IMMEDIATE NEEDS AFTER A DISASTER.
STAFF IS ALSO REQUESTING THAT THE EXECUTIVE DIRECTOR AND HIS DESIGNEES HAVE AUTHORITY TO ACCEPT FUTURE ALLOCATIONS OF ESG RUSH AND AUTHORIZATION TO SUBMIT REQUIRED AMENDMENTS TO THE APPLICABLE STATE OF TEXAS ONE YEAR ACTION PLAN.
AND THAT ENDS MY PREPARED REMARKS.
I'M HAPPY TO ANSWER ANY QUESTIONS.
OKAY, GREAT. SO AGAIN, 1.8 MILLION.
ANY QUESTIONS COMMENTS ON THIS ITEM? IF NOT, I'LL ENTERTAIN A MOTION ON ITEM 26 OF THE AGENDA.
MR. CHAIRMAN, I MOVE THE BOARD, RATIFY THE ACCEPTANCE OF THE ESG RUSH AWARD ALLOCATION AND THE SUBMISSION OF AN AMENDMENT TO THE 2023 STATE OF TEXAS ACTION PLAN AND APPROVE THE ADMINISTRATION AND AWARD OF THE FIRST ALLOCATION OF ESG RUSH FUNDING. ALL IS DESCRIBED, AUTHORIZED AND CONDITIONED IN THE BOARD ACTION REQUEST RESOLUTIONS AND ASSOCIATED DOCUMENTS ON THIS ITEM. SECOND MOTION MADE BY MISS FARIA, SECONDED BY MR. HARPER. ALL THOSE IN FAVOR SAY AYE.
AYE. ANY OPPOSED? HEARING NONE. MOTION CARRIES.
PRESENTATION, DISCUSSION AND POSSIBLE ACTION.
AUTHORIZING STAFF TO REGISTER INTEREST IN.
APPLY FOR AND ACCEPT ADDITIONAL VETERANS AFFAIRS.
[03:15:07]
MR. ADAMS. YES, SIR. GOOD AFTERNOON.HI, MY NAME IS ANDRE ADAMS. I'M THE PROGRAM MANAGER FOR THE SECTION EIGHT PROGRAM.
I WANT TO GO AHEAD AND TALK ABOUT ITEM 27 FOR POSSIBLE ACTION FOR THE DEPARTMENT TO REGISTER, APPLY AND ACCEPT FOR ADDITIONAL VASH VOUCHERS AND IF OFFERED VOUCHERS, BE ABLE TO ADMINISTER AS WELL.
ON JUNE 3RD OF THIS YEAR, THE U.S.
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT HUD RELEASED A NOTICE, PAGE 2418 ANNOUNCING AVAILABLE VOUCHERS FOR APPROXIMATELY 7800 VASH PARTICIPANTS WITH PROVIDING OPPORTUNITY FOR PUBLIC HOUSING AUTHORITIES TO REGISTER FOR THE INTEREST, AND BEING ABLE TO PROVIDE ASSISTANCE FOR THESE VASH VOUCHERS FOR THE PROGRAM.
THESE VASH VOUCHERS REQUIRE THE DEPARTMENT OF VETERANS AFFAIRS TO ENSURE PROVISIONS, CASE MANAGEMENT AND ALSO LOCAL SERVICES, ALONG WITH THE COMPANY OF THE HOUSING AUTHORITY TO PROVIDE THE HOUSING ASSISTANCE AND THEREFORE, WITH THE REGISTRATION OF THE INTEREST, WE WERE REQUIRED TO HAVE A LETTER OF INTEREST OF SUPPORT FROM THE VAMC.
EHMCKE THE MEDICAL MEDICAL CENTERS.
WE DID RECEIVE TWO LETTERS OF INTEREST APPLYING FOR MORE VASH VOUCHERS IN THE AREAS OF KERR COUNTY BANDERA, MEDINA, FORT BEND, AND GALVESTON COUNTY.
THE REGISTRATION OF INTEREST WAS SUBMITTED BY HUD.
HUD WILL NOTIFY THE DEPARTMENT ONCE THE VASH VOUCHERS HAVE BEEN AWARDED.
AND THE REASON WE WERE COMING TODAY.
IF ONCE WE ARE OFFERED VOUCHERS, TO BE ABLE TO ACCEPT THESE VOUCHERS FOR ASKING FOR AUTHORIZATION.
THE IMPACT OF THIS HAS MEANT TO THE COMMUNITY AND THE VETERANS HAS BEEN PROFOUND.
WE RECEIVED VARIOUS COMMENTS REGARDING THE VETERANS AND THE COMMUNITY THAT THESE VOUCHERS MEAN THEY HAVE ARE ABLE TO ACCESS STABLE HOUSING, WHICH IS CRUCIAL TO STEP FORWARD REBUILDING THEIR LIVES.
IT ALSO IT ALSO PROVIDES THEM A FULL SENSE OF SECURITY AND DIGNITY.
ALLOW THEM TO FOCUS ON OTHER ASPECTS OF THEIR WELL-BEING, SUCH AS EMPLOYMENT, EDUCATION AND HEALTH, AS WELL AS JOB PROGRAMS FOR THE COMMUNITY. THE ASSISTANTS AND VETERANS IS IS A WAY OF FOSTERING A SENSE OF UNITY AND SUPPORT.
ADDITIONALLY, IT HELPS REDUCE THE HOMELESSNESS FOR OUR VETERANS.
THROUGH OUR COLLABORATION, WE HAVE SUCCESSFULLY ASSISTED 104 VETERANS BY APPLYING FOR JUST 20 VOUCHERS OVER FIVE YEARS AGO, AND WE'RE CONTINUING TO RECYCLE THE VOUCHERS AS VETERANS ARE BECOMING MORE SELF-SUFFICIENT.
THEREFORE, STAFF ARE RECOMMENDING THE DEPARTMENT THAT OUR BOARD ACCEPT THIS TRADITION.
ACCEPT THIS TO APPLY FOR THESE VOUCHERS AND TO ACCEPT THE REGISTRATION.
THAT CONCLUDES MY TALKING POINTS.
I'M AVAILABLE FOR ANY QUESTIONS.
GREAT. THANKS. SO HOW MANY VOUCHERS DO YOU THINK WE COULD POSSIBLY BE AWARDED? HOW MANY ADDITIONAL? IT JUST DEPENDS ON THE EHMCKE.
THEY BASICALLY WILL LET US KNOW AFTER THEY DO THEIR ASSESSMENTS.
USUALLY WE USUALLY GET ABOUT 20 AT A TIME.
OKAY. SO IT JUST JUST DEPENDS.
YEAH. YEAH. I MEAN, EVERY BIT HELPS, ESPECIALLY ON THIS ONE HERE.
DEFINITELY. SO ANY QUESTIONS ON THIS, MR. HARPER, DO YOU WANT TO MAKE A MOTION? I DO, I MOVE THE BOARD, RATIFY THE SUBMISSION OF THE REGISTRATION OF INTEREST, AND APPROVE THE ACCEPTANCE OF AND THE ADMINISTRATION OF ANY RESULTING VASH VOUCHERS, ALL AS DESCRIBED, AUTHORIZED AND CONDITION IN THE BOARD ACTION, REQUEST RESOLUTION AND ASSOCIATED DOCUMENTS IN THIS ITEM.
NEXT. MOTION MADE BY MR. HARPER, SECONDED BY MR. MARCHANT. ALL THOSE IN FAVOR SAY AYE.
AYE. ANY OPPOSED? HEARING NONE. MOTION CARRIES.
THANK YOU. ANDRE. ITEM 28 OF THE AGENDA PRESENTATION, DISCUSSION AND POSSIBLE ACTION TO AUTHORIZE THE ISSUANCE OF THE 2025 HOME INVESTMENT PARTNERSHIPS PROGRAM. SINGLE FAMILY PERSONS WITH DISABILITIES SET ASIDE NOTICE OF FUNDING AVAILABILITY AND THE PUBLICATION OF THE NOFA IN THE TEXAS REGISTER.
MR. LANDRY. GOOD AFTERNOON, CHAIRMAN VASQUEZ AND BOARD MEMBERS.
[03:20:01]
MY NAME IS CHAD LANDRY AND I AM THE MANAGER OF SINGLE FAMILY PROGRAMS. I AM BEFORE YOU TODAY TO PRESENT ITEM 28, WHICH IS THE 2025 HOME PROGRAM.PERSONS WITH DISABILITIES NOFA.
WITHIN THE SINGLE FAMILY PORTION, WE HAVE THREE DIFFERENT NOFAS.
AS I STATED, THIS NOFA PROVIDES FUNDS TO ASSIST PERSONS WITH DISABILITIES.
THESE FUNDS ARE AVAILABLE STATEWIDE, INCLUDING PARTICIPATING JURISDICTIONS.
THIS CURRENT NOFA BEFORE YOU IS FOR $2,328,618, AND TWO ACTIVITIES ARE ELIGIBLE TENANT BASED RENTAL ASSISTANCE, WHICH RECEIVES $1,862,894, AND HOME RECONSTRUCTION, WHICH GETS 465,724. WITH THAT, I AM HAPPY TO ANSWER ANY QUESTIONS YOU HAVE REGARDING THIS FILE.
BE SURE TO LET THE FIRST GROUP THAT SPOKE TO US KNOW ABOUT THAT.
OH YEAH. THIS IS THIS IS GOING OUT.
DOES ANYONE HAVE QUESTIONS ON THIS ITEM? THE CHAIRMAN I WOULD LIKE TO MAKE A MOTION, PLEASE.
WHY DON'T WE? I'LL ACCEPT THE MOTION.
THE BOARD APPROVED 2025 FOR SINGLE FAMILY PERSONS WITH DISABILITIES.
MOTION MADE BY MR. MARCHANT, SECONDED BY MR. THOMAS. ALL THOSE IN FAVOR SAY AYE.
AYE. ANY OPPOSED? HEARING NONE. MOTION CARRIES.
YOU'RE STILL UP, MR.. I'M STILL UP.
OKAY. ITEM 29 PRESENTATION, DISCUSSION AND POSSIBLE ACTION ON COLONIA SELF-HELP CENTER.
PROGRAM AWARDS TO MAVERICK COUNTY, VALVERDE COUNTY, WEBB COUNTY AND HIDALGO COUNTY IN ACCORDANCE WITH TEXAS GOVERNMENT CODE SECTION 2306 .582 THROUGH COMMUNITY DEVELOPMENT BLOCK GRANT FUNDING.
I AM CHAD LANDRY, MANAGER OF SINGLE FAMILY PROGRAMS. AND THIS IS AGENDA ITEM 29, WHICH IS FOR PROPOSED AWARDS FOR THE STATE FISCAL YEAR 2025 COLONIA SELF-HELP CENTER PROGRAM.
CSC CSC IS FUNDED THROUGH THE FEDERAL COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM, WHICH IS AWARDED TO TDHCA THROUGH AN MOU WITH THE TEXAS DEPARTMENT OF AGRICULTURE.
THE PROPOSED AWARDS I BRING TODAY ARE FOR MAVERICK, VALVERDE, WEBB AND HIDALGO COUNTIES.
EACH CONTRACT IS FOR A FOUR YEAR TERM, AND THE PROPOSED USES OF THE FUNDS ARE PUBLIC SERVICES SUCH AS TOOL LENDING, LIBRARIES AND TECHNOLOGY ACCESS AND SELF-HELP HOUSING CONSTRUCTION ACTIVITIES LIKE RECONSTRUCTION, REHABILITATION AND NEW CONSTRUCTION FOR COLONIA RESIDENTS.
THE CSHC PROGRAM IS UNIQUE AMONG TDCJ PROGRAMS IN THAT THERE IS A COMMITTEE MADE UP OF COLONIA RESIDENTS THAT REVIEWS AND RECOMMENDS THE PROPOSALS, CALLED THE COLONIA RESIDENT ADVISORY COMMITTEE, OR SIRACH.
THEY REVIEWED THESE PROPOSALS AND RECOMMEND TO THE BOARD THAT IT AWARD THESE PROPOSALS IN FULL.
WE PROPOSE TO AWARD $1 MILLION TO MAVERICK COUNTY.
$1 MILLION TO VAL VERDE COUNTY.
AND $900,000 TO HIDALGO COUNTIES.
THESE ARE FURTHER DESCRIBED IN EXHIBITS A THROUGH D.
WITH THAT, I'M HAPPY TO ANSWER ANY QUESTIONS.
SO WHILE HIDALGO GETS SHORTED, IT'S A PERFORMANCE THING.
AND SO THEY JUST DIDN'T PERFORM PERFECTLY OKAY.
WELL BUT I MEAN THIS IS AGAIN REAL MONEY FOR THEM.
THAT'S. YEAH, THAT'S GREAT TO BE DEDICATED TO THE COLONIAS.
DO ANY BOARD MEMBERS HAVE QUESTIONS ON ITEM 29 OF THE AGENDA? IF NOT, I'LL ENTERTAIN A MOTION.
I MOVE THE BOARD APPROVED THE COLONIAL SELF-HELP CENTER PROGRAM AWARDS TO MAVERICK COUNTY.
VAL VERDE COUNTY, WEBB COUNTY AND HIDALGO COUNTY.
[03:25:04]
MOTION MADE BY MISS FARIAS.IS THERE A SECOND? MR. MARCHANT WAIVES THE SECOND.
AYE. ANY OPPOSED? HEARING NONE. MOTION CARRIES.
THANKS, CHAD. YOU KNOW, WE NEED TO MOVE THIS.
THE MONEY. GIVING STUFF UP TO THE FRONT OF THE AGENDA TO MAKE IT GETS ON THE.
YES. QUALIFY UNDER CONSENT AGENDA.
OR ARE THEY A NATURE THAT THEY DO NOT QUALIFY FOR? I LOVE THESE GUYS.
THEY THEY COULD QUALIFY FOR CONSENT.
HOWEVER, IT'S GREAT THAT THE PUBLIC HEARS US TALKING ABOUT US AWARDING NEEDED FUNDS.
OKAY. ITEM 30 OF THE AGENDA PRESENTATION, DISCUSSION AND POSSIBLE ACTION ON APPROVING A NEW OUTSIDE COUNSEL CONTRACT AND DELEGATION OF CONTRACT SIGNATURE AUTHORITY TO THE EXECUTIVE DIRECTOR, MR. CAMPBELL. GREAT. THANK YOU.
THESE LAST COUPLE ARE SHORT, I PROMISE.
CODY CAMPBELL, DIRECTOR OF PROGRAMS AT MULTIFAMILY PROGRAMS FOR TD HCA.
HAVING MET OUR MOST DIFFICULT DEADLINES IN TERMS OF COMMITTING THOSE FUNDS, WE NOW HAVE A SIGNIFICANT PIPELINE OF DEALS THAT WILL BE GEARING UP TO CLOSE IN THE NEXT YEAR OR SO TO HELP GET THROUGH THOSE CLOSINGS AS QUICKLY AS POSSIBLE.
WE ARE NOW RECOMMENDING THAT THE AWARD BE MADE TO THE LAW FIRM OF BEST, BEST AND KREIGER.
THE INITIAL REQUEST ESTIMATED THAT THE TOTAL COST OF THIS EFFORT WOULD BE APPROXIMATELY $600,000.
BUT ONCE ALL OF THE INELIGIBLE DEALS ARE REMOVED, THE FINAL NUMBER SHOULD BE LOWER THAN THAT AMOUNT.
NO GENERAL REVENUE WILL BE USED TO PAY THE OUTSIDE FIRM.
STAFF RECOMMENDS APPROVAL, AND I'M HAPPY TO ANSWER ANY QUESTIONS YOU MAY HAVE.
OKAY, SO THIS IS NOT GR FUNDS.
IT'S FUNDED BY THE THE ADVENT FUNDS THAT COME.
OKAY. AND IS THIS A TEMPORARY EXPERIMENTAL MEASURE TO SEE IF IT'S WE BLAST THROUGH EVERYTHING, OR IS THIS GOING TO BE A PERMANENT RECURRING? IT IS.
BUT IT IS TIME LIMITED, THOUGH I BELIEVE IT GOES THROUGH THE END OF NEXT STATE FISCAL YEAR.
AND WE'LL PLAN ACCORDINGLY VERSUS ALSO JUST BRINGING SOMEONE IN ADDITIONAL PEOPLE IN-HOUSE.
THAT'S MY MAIN POINT. IT'S NOT GOING TO JUST BE A CONTINUING RECURRING.
DO YOU FIND A CONFLICT OF INTEREST ON A PARTICULAR CONTRACT THAT WOULD DEFAULT BACK TO INTERNAL? YES, SIR. WE HAVE FANTASTIC INTERNAL ATTORNEYS WHO CAN HANDLE THAT WHEN THAT HAPPENS.
OKAY. I THINK MORE QUESTIONS ON ITEM 30.
IF NOT, I'LL ENTERTAIN A MOTION.
I MOVE THE BOARD, APPROVE AND AUTHORIZE ENTRY OF NEW OUTSIDE COUNSEL CONTRACT AS DESCRIBED, AUTHORIZED AND CONDITIONED IN THE BOARD ACTION, REQUEST AND RESOLUTION ON THIS ITEM. SECOND.
MOTION MADE BY MR. HARPER, SECONDED BY MISS FARIAS.
AYE. ANY OPPOSED? HEARING NONE. MOTION CARRIES.
MEMBERS OF THE BOARD JOSH GOLDBERGER, COMPETITIVE HOUSING TAX CREDIT MANAGER AT TDHCA.
WE ONLY HAVE TWO OF THESE FOR YOU TODAY, BUT I WILL STILL START WITH OUR USUAL REFRESHER WHEN AN AWARD OF HOUSING TAX CREDITS IS MADE TO A DEVELOPMENT, THE OWNER HAS UNTIL THE SECOND CALENDAR YEAR FOLLOWING THAT AWARD TO PLACE THE DEVELOPMENT IN SERVICE.
[03:30:06]
VISTA AT SILVER OAKS IS A 76 UNIT DEVELOPMENT TO BE CONSTRUCTED IN SAN ANTONIO.CONSTRUCTING THE REMAINDER OF THE PUBLIC SEWER LINE CAUSED AN 82 DAY DELAY.
WOULD BE FUN JUST TO PUT PRESSURE ON THEM TO GET THAT DONE BEFORE THE END OF THE YEAR.
OKAY, BUT THIS IS A REALLY TARGETED DATE.
CERTAIN AND JUST EXTRA TIME JUST IN CASE.
ANYONE ELSE? ANYONE HAVE QUESTIONS OR WANT TO MAKE A MOTION ON ITEM? MR. CHAIRMAN, I MOVE TO GRANT THE REQUESTED TREATMENT UNDER AN APPLICATION OF THE 40 YEAR RULE TO VISTA AT SILVER OAKS, WITH A PLACE AND SERVICE DEADLINE OF MARCH 31ST, 2025.
SECOND MOTION MADE BY MR. MARSH AND SECONDED BY MISS FARIAS.
AYE. ANY OPPOSED? HEARING NONE. MOTION CARRIES.
THANKS, JOSH. ITEM 32, THE FINAL POSTED ITEM ON THE AGENDA PRESENTATION, DISCUSSION AND POSSIBLE ACTION ON AND APPROVAL OF A LOAN AND A REQUEST FOR RETURN AND REALLOCATION OF TAX CREDITS UNDER TEN TAX.
THIS DEVELOPMENT WAS AWARDED 9% HOUSING TAX CREDITS IN 2023 FOR THE NEW CONSTRUCTION OF 90 UNITS, 57 OF WHICH WILL BE AFFORDABLE IN LEWISVILLE. AFTER THAT AWARD, INCREASES IN INTEREST RATES AND CONSTRUCTION COSTS RESULTED IN A $4.4 MILLION FUNDING GAP THAT PREVENTED THE DEVELOPMENT FROM MOVING FORWARD. TO ADDRESS THIS, THE DEVELOPER APPLIED UNDER THE DEPARTMENT'S 2024 TWO HOME NOTICE OF FUNDING AVAILABILITY.
STAFF IS RECOMMENDING TODAY THAT A LOAN OF HOME FUNDS, IN THE AMOUNT OF $4,438,911 BE APPROVED.
THIS LOAN WILL BE STRUCTURED AS FULLY REPAYABLE AT 2% INTEREST.
THE TOTAL DEVELOPMENT COST IS APPROXIMATELY $30 MILLION, SO IT STARTED OUT AT 26 AND HAS GONE UP TO 30 MILLION BECAUSE OF THE DELAYS CAUSED BY THE FUNDING GAP, THE DEVELOPER HAS NOT YET CLOSED ON THE LAND OR COMMENCED CONSTRUCTION AND THEREFORE CANNOT MEET ITS CURRENT DEADLINE TO PLACE IN SERVICE OF DECEMBER 31ST, 2025.
OKAY, SO THIS ONE HASN'T EVEN STARTED YET.
DOES ANYONE ELSE HAVE QUESTIONS ON THIS ITEM? WE IN THE INCREASE IS JUST COST INCREASES IS NOT CHANGING THE NUMBER OF UNITS OR ANYTHING LIKE THAT.
THE NUMBER OF UNITS REMAINS CONSISTENT.
THERE WAS AN ITEM ON THE CONSENT AGENDA TO CHANGE THERE, LIKE ONE UNIT.
WHICH IS JUST A IT'S A PROGRAM THING.
IT DOESN'T AFFECT THE ACTUAL CONSTRUCTION OF THE DEVELOPMENT.
[03:35:05]
OKAY. BUT OTHERWISE WE'RE READY TO GET THIS THING'S READY TO START TO HIT THE GROUND RUNNING.OKAY. WOULD YOU CARE TO MAKE A MOTION, MR. HARPER? I MOVE THE BOARD, GRANT THE REQUESTED TREATMENT UNDER THE APPLICATION OF FORCE MAJEURE RULE, AND APPROVE THE REQUESTED HOME LOAN FOR 305 EAST ROUND GROVE LIVING.
SECOND. MOTION MADE BY MR. HARPER, SECONDED BY MR. FARIAS. ANY FURTHER DISCUSSION? JUST KIDDING. OKAY. ALL RIGHT.
AYE. ANY OPPOSED HEARING? NONE. MOTION CARRIES.
THANK YOU. CODY. THANK YOU FOR WAITING TILL THE END.
MR. CHAIRMAN, CAN I ASK A QUESTION OF MR. MISS MORALES? SURE. THANK YOU FOR WAITING FOR THE ENTIRE EVENING.
SOME OF THEM, NOT ALL OF THEM GO UP SIGNIFICANTLY.
WHILE YOU DON'T SEE THAT 9% DEALS.
WHY DO YOU SEE? WHY DO WE SEE THAT SO MUCH? SO ON 9% DEALS BECAUSE THE CREDITS ARE COMING FROM THE CEILING, WHICH MEANS THERE'S ONLY A CERTAIN AMOUNT WITH WHICH WE HAVE TO ALLOCATE.
ON THE 4% SIDE, THE CREDITS ARE NOT LIMITED BY A CEILING, IT'S LIMITED BY ELIGIBLE BASIS.
CURB THAT BEHAVIOR SO WE CAN GET MORE DEALS OUT THERE ON THE SAME CREDIT OR ON MORE CREDITS OUT THERE? HOW DO WE CURB THAT BEHAVIOR? BECAUSE THERE WOULD BE NO COST CONTROL FOR ANYBODY TO BUILD THOSE.
I MEAN, BECAUSE WHEN WHEN YOU COME TO ME AND I LOOK AT THESE DEALS AND WE HAVE 68 AND 87% INCREASES IN COST, IT JUST SEEMS SEEMS LIKE A LOT. SO WHAT I WILL TELL YOU IS THAT TYPE OF BEHAVIOR I WOULD SAY IS RARE.
SO WE DO HAVE A PROVISION IN THE RULES THAT SAYS IF YOUR IT USED TO BE IF YOUR CREDIT INCREASE IS GREATER THAN 110% OF WHAT IT WAS ORIGINALLY, THEN YOU NEED TO COME BACK TO THE BOARD AND EXPLAIN HOW YOU GOT IT THAT WRONG.
RIGHT. BECAUSE OF COVID, WE MODIFIED THE RULE TO 20%.
WHAT I WHAT I WILL TELL YOU WITH RESPECT TO THE ITEMS THAT WERE ON THE AGENDA THAT HAD THOSE SUBSTANTIAL INCREASES, THAT IS CONSIDERED RARE JUST FOR WHAT HAPPENED THAT YEAR.
SO WHEN I TAKE A LOOK AT ALL OF THE 4% DEALS THAT CLOSED IN 2020, BOTH NEW CONSTRUCTION AND ACQUISITION REHAB, THE DEPARTMENT RECEIVED THE FINAL COST CERTIFICATION PACKAGES ON 84% OF THOSE.
THE NUMBER OF CHANGE ORDERS OR COST INCREASES RANGED ANYWHERE FROM $0 ACTUALLY, TO 4 MILLION, I THINK WAS THE HIGHEST ONE THAT I SAW. BUT EVERYTHING IN THE MIDDLE WAS SEVERAL HUNDRED THOUSAND, A MILLION HERE AND THERE.
SO GOOD MANAGEMENT OF YOUR PROJECTS.
I'M SORRY. MOST OF IT'S GOOD MANAGEMENT OF PROJECTS.
IT'S BEEN MANAGED BY PROJECTS.
SURE. YEAH. YEAH. I AGREE WITH YOUR CONCERN.
I MEAN, SO WE DON'T NEED TO ADDRESS THIS RIGHT NOW BECAUSE MR. MARCHANT HAS TO CATCH A FLIGHT.
AND LET'S CONTINUE CONVERSATION ON THERE.
THE BOARD HAS ADDRESSED THE POSTED AGENDA ITEMS. NOW IS THE TIME OF THE MEETING WHEN MEMBERS OF THE PUBLIC CAN RAISE ISSUES WITH THE BOARD ON MATTERS OF RELEVANCE TO THE DEPARTMENT'S BUSINESS, OR REQUESTS THAT THE BOARD PLACE
[03:40:03]
SPECIFIC ITEMS ON FUTURE AGENDAS FOR CONSIDERATION.IS THERE ANYONE THAT WOULD LIKE TO MAKE PUBLIC COMMENT AT THIS TIME? I WOULD OH, I SO BRAVELY DO.
OKAY. ALL RIGHT. YOU'VE WAITED THE WHOLE TIME.
INTRODUCE YOURSELF AND SIGN IN.
AND TO KEEP IT BRIEF, MY NAME IS MARTY MASCARI.
I'VE ACTUALLY BEEN INVOLVED IN AFFORDABLE HOUSING SINCE 1995.
I'VE. IN EARLY 2000, I WAS INVOLVED IN DEVELOPING.
I GOT INTO NON-FOR-PROFIT AND GOT INTO AFFORDABLE HOUSING ADVOCACY.
I CURRENTLY AM A CONTRACTOR UNDER THE NORTH CENTRAL TEXAS COUNCIL OF GOVERNMENTS.
BUT I WAS JUST ASKING FOR YOUR IF YOU WOULD TAKE A CHANCE TO LOOK AT THE CLEARINGHOUSE.
AND FOR YOU, ALL THAT I KNOW ARE INVOLVED WITH THIS ON A DAY TO DAY BASIS.
THIS SEEMS VERY FAMILIAR LANGUAGE TO YOU WHEN WE TALK ABOUT 60S AND 30S AND 60S AND 50S AND, AND WE TALK ABOUT, YOU KNOW, SLIDING SCALE, HOW VOUCHERS WORK.
BUT ONE OF THE, THE HARDEST THINGS WE HAVE IS IN TEACHING THEM ABOUT TAX CREDIT.
HOUSING IS IN THE VACANCY, IN THE VACANCY CLEARINGHOUSES WHERE WE TEACH THEM TO GO IN TO LOOK AT WHAT WHAT HOUSING TAX CREDIT, HOUSING IS AVAILABLE IN YOUR AREA.
IT'S NOT LISTED HOW MANY UNITS ARE UNDER EACH INCOME RESTRICTED LEVEL, LIKE HOW MANY 30% UNITS.
HOW MANY 50% UNITS, HOW MANY 60% UNITS.
BUT MORE IMPORTANTLY, THE ISSUE IS THAT MOST OF THE PEOPLE ANSWERING THE PHONE DON'T KNOW.
DON'T HAVE A CLUE EITHER, BECAUSE THEY'RE A STAFF MEMBER.
THEY'RE JUST SOMEBODY THEY'VE HIRED BECAUSE THEY'VE HAD A HARD TIME FILLING THAT SPOT.
AND SO THEY CALL AND AND THE PERSON THE CONSUMERS DON'T HAVE ENOUGH CONFIDENCE TO SAY, WELL, THEN COULD I TALK TO YOUR MANAGER, OR COULD I TALK TO SOMEONE ELSE WHO MIGHT BE ABLE TO ANSWER THAT QUESTION? AND SO AS WE'RE LOOKING TO SEE IF WE COULD JUST GET THAT POSTED ON ON THE CLEARINGHOUSE, IT WOULD NOT HAVE, YOU KNOW, I REALIZED IT WOULD NOT HAVE TO BE CHANGED JUST A ONE TIME POST.
WE HAVE 31% AND 30% UNITS, 50, YOU KNOW, ONE BEDROOM, 5%, YOU KNOW, YOU KNOW, 50% UNITS.
BUT JUST TO DO THAT ON A ONE TIME BASIS, RIGHT AT THE BEGINNING, BUT THEN ALSO NOW THAT WE'RE SEEING SO MANY OF THEM CHANGE AS THEY'RE THEY'RE RUNNING OUT OF THEIR AFFORDABILITY PERIOD.
AND, AND THEY'RE ENTERING INTO A NEW AGREEMENT.
AND NOW ALL OF A SUDDEN THEY'VE GONE FROM 30S 50S AND 60S.
NOW THEY HAVE THEY'RE ALL ALL 60% UNITS.
AND MAYBE THERE'S SOMEONE ON STAFF WE CAN CONNECT WITH.
ALL RIGHT. NO. GREAT. THANKS FOR COMING.
WELL, MY QUESTION IS, HERE'S HOW MANY WE HAVE, BUT THEN HOW MANY ARE AVAILABLE THAT WOULD NEED.
THAT WOULD BE THAT WOULD BE THE PROBLEM.
AND THAT'S AND AND WE'RE NOT LOOKING FOR THAT.
LIKE, YOU KNOW, WELL THE PROBLEM WITH THAT IS THAT'S A PROBLEM ACROSS THE BOARD.
THE MINUTE THEY THE MINUTE THEY CHANGE IT, IT'S OLD FIVE MINUTES LATER, YOU KNOW, AND TECHNICALLY WE'RE NOT ALLOWED TO DISCUSS ANYTHING ON THIS PERIOD THAT'S NOT POSTED LIKE THIS BECAUSE WE'LL GET THAT.
STOP THAT OKAY. ALL RIGHT. OKAY.
IS THERE ANY OTHER PUBLIC COMMENTS? IF NOT, THE NEXT SCHEDULED MEETING OF THE GOVERNING BOARD IS SET FOR 10 A.M.
AND IS THIS STILL CORRECT? IN THE CAPITAL EXTENSION ROOM E 2.030.
[03:45:04]
ALL RIGHT. OKAY. BUT WATCH FOR FURTHER POSTINGS TO FOR ALL THAT CONFIRMATION AND SEEING THAT THE BUSINESS IS COMPLETED, IT IS NOW 203 AND THIS MEETING IS ADJOURNED.THANK YOU. GOOD.
* This transcript was compiled from uncorrected Closed Captioning.