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The TDHCA convened its board meeting at 10:04 am on September 7, 2023, at the  Texas Capitol, Extension Hearing Room E2.030 1100 Congress Avenue Austin, TX  78701. Consent Agenda & Consent Report approved.

September 7 Meeting Summary

TAAHP Staff attended the board meeting and summarized its main takeaways.

Resolution: October is Energy Awareness Month

AGENDA ITEM 10: Executive Director’s Report

Bobby Wilkinson Executive Director, TDHCA

  • Homeowner assistance fund (HAF) is active. Close to winding down – close the portal to new application. There is not system of reallocations. Expended 79% of its total allocation. The HAF program is federally funded that can help Texan residents with overdue mortgage payments, property tax, homeowners’ insurance, HOA fees and now recently utilities assistance.
  • TDHCA has approved funding for 50,000 households. They have disbursed over $562 million, with an additional $1.2 million in progress. Average $11,174 assistance per household.
  • New 9% Housing Tax Credit Manager – Joshua Goldberger
  • TDHCA timely committed all of Texas’ National Housing Trust Fund grants in late July deadline. $42 million in housing trust funds is under contract.

AGENDA ITEM 11:

(Brooke Boston/ Deputy executive director): Presentation, discussion, and possible action authorizing the Department to submit an application for the Environmental Protection Agency’s Solar for All Program, and if successfully awarded, to operate such program

  • Application for the $400 million in funding in response to the NOFA on the Solar For All program.
  • The EPA NOFA required that a notice of intent to apply for the funds be submitted to EPA no later than July 31st
  • Submitting a full application by the newly revised deadline of October 12th, 2023.
  • Staff is recommending that 80% of the funds be used for financial assistance to promote solar delivery in existing multifamily affordable rental properties serving low income households. The remaining 20% of funds will be used for technical assistance and administrative expenses.
  • existing multifamily properties that are serving low income household apply for participation either directly to TDHCA or potentially via a vendor that we may procure for that task that’s yet to be determined for those properties selected.
  • They would then pick their own solar installer from a list of installers vetted and approved through an RFQ process operated by TDHCA. The pre-qualified vendors must meet certain workforce standards relating to job development as required by EPA.

ACTION REPORT ITEMS

AGENDA ITEM 13: Quarterly report relating to staff-issued Determination Notices for 2023 Non-competitive 4% Housing Tax Credit applications. (June – August)

Teresa Morales, Director of Multifamily Bonds

  • 17 determination notices issued from late June to August which represent approximately 3,388 total units and $36 million in annual 4% HTCs. 24 applications under review for a total of 6,000 units. When considering what has closed, been approved, and is currently active, the total number of units is 13,000 units.

Multifamily Bond

AGENDA ITEM 17: Presentation, discussion, and possible action regarding a waiver of 10 TAC §11.101(b)(1)(A)(vii) of the Qualified Allocation Plan (QAP) relating to the percentage of efficiency and/or one bedroom units for Aspire at Big Austin.

Teresa Morales, Director of Multifamily Bonds

  • 368 units – with 18 efficiency units and 220 one-bedroom units. Equals 65% of the total unit count.
  • Board approved waiver.

AGENDA ITEM 18: Presentation, discussion, and possible action regarding a waiver of 10 TAC §11.101(a)(2) of the Qualified Allocation Plan (QAP), relating to Undesirable Site Features for The Life at Beverly Palms (#23471)

  • Waiver Request for Proximity to an Oil Refinery:
  • Acquisition and Rehab of 308 units
  • Undesirable site feature – being within two miles of a refinery boundary to boundary.
  • The actual physical infrastructure of the tanks and building are beyond two miles.
  • The current QAP measures it from boundary to boundary, irrespective of where the actual activities are.
  • Board approved waiver.

AGENDA ITEM 19: Presentation, discussion, and possible action on Inducement Resolution No. 24-001 for Multifamily Housing Revenue Bonds regarding authorization for filing applications for private activity bond authority

  • Inducement: Department’s intent to issue bonds and provides the authority necessary to submit the application for each project to the bond review board in order to obtain a reservation of PABs.
  • This inducement includes four applications requesting a total of $170 million in private activity bond volume cap.
  • The four applications will create 787 new construction units and 151 newly renovated units and will primarily serve 60% AMI households.
  • Motion carries

AGENDA ITEM 20: Presentation, discussion, and possible action on an order proposing the repeal of 10 TAC Chapter 12, concerning the Multifamily Housing Revenue Bond Rules, and an order proposing new 10 TAC Chapter 12 concerning the Multifamily Housing Revenue Bond Rules, and directing their publication for public comment in the Texas Register

  • The proposed changes primarily include modifications to existing scoring items by clarifying that a resolution of support from the applicable governing body will count for points under the development support and opposition scoring item and clarifying that only a letter from city council member or commissioner as applicable that represents the proposed development will count for points instead of a letter from any of the aforementioned members.
  • Motion carries

TDHCA Board went into executive session from 12:12 and returned at 1:05 PM.

Homeless Programs

Rosy Falcon, Homeless Programs Manager

AGENDA ITEM 27: Presentation, discussion, and possible action on State Fiscal Year 2022 Homeless Housing and Services Program Reallocation.

  • Requesting to reallocate $179,140 unused funds to the City of San Antonio – they have the highest rate of expenditure on their existing HHSV Youth Set-aside Award.
  • San Antonio must expend all funds prior to August 31, 2024.

Multifamily Finance

Cody Campbell & Colin Nickells

AGENDA ITEM 29: Presentation, discussion, and possible action on an award of National Housing Trust Fund to Campanile on Minimax (23508)

  • This item concerns a recommended National Housing trust fund or NHTF loan in the amount of $7,995,000 for Campanile on Minimax. The development received $1.7 in million in competitive housing tax credits and supplemental credits earlier this year.
  • Board approves the award.

AGENDA ITEM 30: Presentation, discussion, and possible action on multiple requests for return and reallocation of tax credits under 10 TAC §11.6(5) related to Credit Returns Resulting from Force Majeure Events for Applications previously awarded 9% housing tax credits

  • Dahlia Villas (2021 Award) – the development is approximately 80% complete and the final significant hold is being caused by delays in obtaining transformers for development. Transformers won’t arrive before the December 1st deadline. The development should place in service by mid 2024. Staff recommends December 31, 2024 deadline.
  • Hartwood at Klarbach (2022 Award) – Requests extension to value engineering the site plan to maintain financial feasibility. Staff recommends approval.
  • Board approves both requests for force majeure

AGENDA ITEM 31: Presentation, discussion, and possible action on a waiver of certain amenity requirements in 10 TAC §11.101(b)(4) for El Jardin (23951)

  • Requested waiver of the requirements for TDHCA developments to have energy star or equivalently branded windows.
  • Development received historic tax credits from the National Park Service that has specific design requirements – they must install similar windows.
  • The original windows are clear and there’s not a product on the market that meets both the park services’ requirements and TDHCA requirement that any windows installed should be Energy Star Rated.
  • Board grants the waiver request.

AGENDA ITEM 32: Presentation, discussion, and possible action on the proposed repeal of 10 TAC Chapter 11 concerning the Housing Tax Credit Program Qualified Allocation Plan, proposed new 10 TAC Chapter 11 concerning the Housing Tax Credit Program Qualified Allocation Plan, and directing their publication for public comment in the Texas Register

  • High quality pre-kindergarten: The QAP now includes an automatic award to the highest scoring application in a subregion that includes a high quality pre-kindergarten on site that is available for free to the towns. This applies only to urban subregions that have county with at least 1.5 million people. This policy proposal is made as a result of the Governor’s 2023 QAP approval letter, which asked the department to better incentivize early childhood education through this program.
    • TDHCA Board lowered to $1 million people
  • New Tiebreaker: The new tiebreaker proposes prioritizing developments that will be located in the closest proximity to common amenities that are important to low-income families including elementary schools, grocery stores, parks, and public libraries.
  • Veterans: An extra point is available to developments that are located on veterans’ affairs campuses, and that have a supportive housing occupancy preference for veterans.
  • Opportunity Index: The opportunity index scoring category has been modified to allow for more high-quality small towns to score these points.
  • Number of Low-Income Units: Applications will be eligible for points for proposing a number of units above the average of the last two years. One point is available for a 10% increase. Two points are available for a 20% increase, and for rehabilitation developments, only three points are available for a 50% increase over the previous average.
    • TDHCA Board did not eliminate this new provision. Asked for TAAHP to submit comments.
  • Experience Requirements: Elimination of experience requirements for participating in our programs. Staff believes that the tremendous complexity of putting together one of these applications as well as the extensive reviews that a developer must go through to get financing and equity investment are likely a sufficient enough filter and that our current requirements may not be adding anything meaningful to the process.
  • State Housing Tax Credit: The QAP adds a new sub-chapter F to implement the state housing tax credit. House Bill 1058 passed this year, which creates a state housing tax credit. The annual ceiling is $25 million. The bill requires that the credits be split between 4% and 9% applications, and the credits for each have to be handled differently.
    • Applicants will be required to submit an application that is complete and financially feasible without having the state credits in that same application.
    • The applicant will have to indicate that they’re interested in taking state credits, how many they would want to take, and how many additional 30% units they would provide at the development in exchange for those credits.
    • After the awards, the federal credits are made in July, staff will review the winning applications and identify those that provide the greatest number of 30% units per state housing tax credit.
    • Those winning applications will then be materially amended and underwritten to include the state housing tax credits.
    • This priority for the most 30% units is only applicable in the event that we receive more applications per state credits than we can fund, as the bill only allows the department to set priorities if we are oversubscribed.
  • Readiness to Proceed: Reinstated and requested in the governor’s approval letter from this year’s QAP.
    • TDHCA board approved TAAHP’s recommendation.
  • General Contractor Fees: Decrease fees from 14% of the total hard costs to 8%
    • TDHCA Board voted to eliminate this new provision.
  • Soft Costs: Decrease fees from 14% of the total hard costs to 8%
    • TDHCA Board voted to eliminate this new provision.
  • Developer Fee: be limited to what was initially underwritten and awarded.
    • TDHCA Board Voted to eliminate this new provision.
  • HOME Match Financial Contributions: The draft QAP requires that any 9% applicant that is requesting more than $1.5 million in tax credits must provide a match contribution of at least 10% of the annual amount. For 4% transactions the associated tax exempt bonds will generally be used as match unless they come from a local issuer and are being used as match by the local jurisdiction.
    • TDHCA board did not eliminate this new provision. They asked TAAHP submit comments.
  • Notification of recipients: The use of email has been deleted from as an acceptable form of notification.
    • TDHCA Board reinstated the use of email.

 

Meeting adjourned at 4:46 PM

The next TDHCA board meeting is on October 26, 2023.