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Home My WebLink About2005/04/26-Minutes-Fort Worth Housing Finance Corporation (FWHFC) CITY OF FORT WORTH, TEXAS FORT WORTH HOUSING FINANCE CORPORATION CALLED—SPECIAL SESSION MINUTES TUESDAY,APRIL 26,2005 Present: President Mayor Pro Tempore Ralph McCloud—District 8 Vice President Council Member Becky Haskin—District 4 Director Mayor Mike Moncrief Director Council Member Jim Lane—District 2 Director Council Member John Stevenson, District 7 Director Council Member Wendy Davis, District 9 (arrived at 1:35 p.m.) Absent: Secretary Council Member Donavan Wheatfall—District 5 Treasurer Council Member Clyde Picht—District 6 Director Council Member Chuck Silcox—District 3 City staff: Assistant City Manager Dale Fisseler Assistant City Attorney Vicki Ganske Director of Housing Jerome C. Walker Assistant City Manager Joe Paniagua Call to Order (Agenda Item I) President McCloud called the meeting to order for the Board of Directors of the Fort Worth Housing Finance Corporation at 1:28 p.m. on Tuesday, April 26, 2005, in the Pre-Council Chamber of the Fort Worth Municipal Building, 1000 Throckmorton, Fort Worth, Texas. Approval of Minutes of the February 22, 2005 Meeting (Agenda Item II) President McCloud opened the floor for a motion on the approval of the minutes of the Tuesday, February 22, 2005 meeting. MOTION: Upon a motion made by Director Stevenson and seconded by Director Haskin, the Board of Directors voted five (5) "ayes" and no (0) "nays" to approve the February 22, 2005 minutes as presented. The motion carried. CITY OF FORT WORTH, TEXAS FORT WORTH HOUSING FINANCE CORPORATION CALLED—SPECIAL SESSION MINUTES TUESDAY,APRIL 26, 2005 Page 2 Executive Session (Agenda Item III) President McCloud passed over this agenda item. Housing Development Fund Loan Applications — Discussion and Consideration of a Resolution for an Interim Construction Loan to Robert Steven Lerma dba Espaniola Homes to Build Two Single- Family Homes (Agenda Item IV-A) Jerome Walker, Director of Housing, presented the agenda item. He advised that the Fort Worth Housing Finance Corporation adopted a resolution creating the Fort Worth Housing Development Fund (FWHDF). This fund was established to encourage small developers to increase their production capacity by making interim loans available that offer flexible terms and a favorable interest rate. He added that approval of the loan request would allow the simultaneous construction of two homes instead of one. Mr. Walker reviewed the history of the contractor Robert Steven Lerma, d/b/a Espaniola Homes. He advised that these homes would be built at 2903 and 2905 Loving Avenue on the north side of Fort Worth. He added that the construction drawings have been submitted to build two single-family homes for sale that have been appraised at a post-construction cost of $107,000 each. He added that the homes are of brick and frame construction, with 1,444 sq. ft. of living area and feature three bedrooms, two baths and a two-car garage. He pointed out amenities in the homes. Mr. Walker presented the requested loan details, which was $131,714, which represented 71.2% of the combined appraisals and 61.5% of the construction cost. The construction cost was $184,480. He added that this is exceeding the program guidelines, which is the lesser of 50% of appraised value or 100% of construction cost. Mr. Walker explained that staff is recommending the waiving of the personal guaranty requirement, mitigated by the borrower's $100,000 line of credit. He added that the corporation's loan would be secured by a lien on the lots and improvements. The owner's equity is approximately $6,700. Mr. Walker advised that the City staff's recommendation was to approve the FWHFC grant of a loan in the amount of $131,714 from its FWHDF HOME funds to Robert Steven Lerma, d/b/a Espaniola Homes. There was considerable discussion by the Board on the qualifications of the contractor; what other contractors had requested this funding; if the neighborhood objected to the CITY OF FORT WORTH, TEXAS FORT WORTH HOUSING FINANCE CORPORATION CALLED—SPECIAL SESSION MINUTES TUESDAY,APRIL 26, 2005 Page 3 Housing Development Fund Loan Applications — Discussion and Consideration of a Resolution for an Interim Construction Loan to Robert Steven Lerma dba Espaniola Homes to Build Two Single- Family Homes (cont'd) (Agenda Item IV-A) construction of these homes in that area; and if this construction will meet the City's building standard guidelines. Deliberation continued on the design of the house with the garage on the front entry and the size of the lot being a 50' lot. Board Member Haskin expressed her concern with the size of the garage and how much coverage it took on the front of the house. Board Member Haskin suggested that the building design flip the garage from it current location to the other side of the house. Board Member Davis also indicated her support of the change in the home design and meeting the City's building standards guidelines. After further deliberation, the Board suggested to the City staff that this item be delayed to a future meeting in order to address the garage issue. There was no formal action taken on this item. Housing Development Fund Loan Applications — Discussion and Consideration of a Resolution for Conditional Approval of a Subordinate Interim Construction Loan to Oak Timbers — Fort Worth South L.P. to Build a 168 Unit Multi-family Rental Community for Seniors (Agenda Item IV-B) Director of Housing Jerome Walker presented the agenda item to the Board Members. He advised that Oak Timbers-Fort Worth South, LP has made application with the Texas Department of Housing and Community Development Agency for Low Income Housing Tax Credits to construct a 168-unit multi-family rental project for seniors. FWHFC's contract is conditioned on the award of the state tax credits. The project consists of 84 one-bedroom and 84 two-bedroom units located on 6.6 acres at 300 E. Terrell in the Fort Worth South (Medical District) redevelopment area. He added that of these units: eight are market rate; 143 are affordable to households earning 50% to 80% of AMFI; and, 17 units are affordable for households earning less than 50% of AMFI. Mr. Walker reviewed the rents. Mr. Walker advised that the applicant has requested an interim construction loan from the FWHDF for $1,000,000 of the projected construction cost of$17,211,037, presently a loan ratio of 1:17.2. The FWHFC will have a subordinate position lien on the land and improvements, CITY OF FORT WORTH, TEXAS FORT WORTH HOUSING FINANCE CORPORATION CALLED—SPECIAL SESSION MINUTES TUESDAY,APRIL 26,2005 Page 4 Housing Development Fund Loan Applications — Discussion and Consideration of a Resolution for Conditional Approval of a Subordinate Interim Construction Loan to Oak Timbers — Fort Worth South L.P. to Build a 168 Unit Multi-family Rental Community for Seniors (cont'd) (Agenda Item IV-B) further secured by the personal guaranty of A. V. Mitchell. Mr. Walker explained that the loan term is for two years at a variable interest rate of the Federal Rate plus 50 bps, adjusted quarterly. The borrower will make interest-only payments over the term of the loan and will repay the loan with the take-out commitment of the permanent lender. Mr. Walker advised that the City staff recommendation was to approve the FWHFC grant of a conditional interim construction loan in the amount of $1,000,000 from its FWHDF HOME funds to Oak Timbers-Fort Worth South, L.P. Board Member Davis requested further clarification on the interest rate. President McCloud advised of his support for this project. Mr. Walker clarified for the Board that the City was not at risk for this loan. He advised of the ranking of this project at the state. MOTION: Upon a motion made by Board Member Stevenson and seconded by Board Member Davis, the Fort Worth Housing Finance Corporation Board of Directors voted six (6) "ayes" and no (0) "nays" to approve the a subordinate interim construction loan to Oak Timbers — Fort Worth South, L.P. to build a 168 unit multi-family rental community for seniors. The motion carried. Housing Development Fund Loan Applications — Discussion and Consideration of a Resolution for Conditional Approval of a Subordinate Interim Construction Loan to Fort Worth Eastland Housing Partners, Ltd. To Build a 158 Unit Multi- family Rental Community for Families (Agenda Item IV-C) City staff advised that Board Member Wheatfall had requested that this item be delayed to a future meeting. There was no formal action taken on this item. CITY OF FORT WORTH, TEXAS FORT WORTH HOUSING FINANCE CORPORATION CALLED—SPECIAL SESSION MINUTES TUESDAY,APRIL 26, 2005 Page 5 Request for Future Agenda Items and/or Reports (Agenda Item V) There were no future agenda items requested by the Board Members or reports given by the Board Members. Board Members requested that the City staff bring back for their consideration Agenda Item IV-A. Adjourn (Agenda Item VI) With no further business before the Board, President McCloud adjourned the called — special session of the Fort Worth Housing Finance Corporation Board of Directors at 1:45 p.m. on Tuesday, April 26, 2005. These minutes approved by the Fort Worth Housing Finance Corporation Board of Directors on the 10th day of May, 2005. AAPP ED: Cloud VnavanWheatfall Prepared and respectfully submitted by: Marty Hendrix City Secretary