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HomeMy WebLinkAboutResolution Fort Worth Housing Finance Corporation (FWHFC) FWHFC-2022-09RESOLUTION NO. FWHFC-2022-09 FORT WORTH HOUSING FINANCE CORPORATION A RESOLUTION APPROVING A FORGIVABLE LOAN TO THE PRESBYTERIAN NIGHT SHELTER OF TARRANT COUNTY OR AN AFFILIATE FOR THE DEVELOPMENT OF JOURNEY HOME HOUSING PERMANENT SUPPORTIVE HOUSING LOCATED AT 7550 CROWLEY ROAD AND AUTHORIZING EXECUTION OF CONTRACTS AND RELATED LOAN DOCUMENTS WHEREAS, the City Council of the City of Fort Worth ("City") has adopted development and revitalization of the City's neighborhoods and affordable housing stock as a strategic goal, and City residents and the City Council have determined that quality accessible affordable housing is needed for moderate, low and very low-income City residents; WHEREAS, the City Council created the Fort Worth Housing Finance Corporation (the "Corporation") in 1979 pursuant to the Texas Housing Finance Corporations Act, Chapter 394 of the Texas Local Government Code, to facilitate neighborhood revitalization and housing initiatives in the City, including but not limited to issuing tax exempt bonds, developing, rehabilitating and promoting housing, and assisting low to moderate income City citizens in acquiring quality, accessible, affordable housing through lending and construction activities; WHEREAS, the City Council in 2014 appointed a Task Force on Permanent Supportive Housing and adopted Permanent Supportive Housing Guidelines and Recommendations in 2015 which included support for scattered site, single site and integrated models located near public transportation (City Council Resolutions No 4349-08-2014 and 4459-06-2015); WHEREAS, the Corporation, the Housing Authority of the City of Fort Worth d/b/a Fort Worth Housing Solutions, and Tarrant County Homeless Coalition agreed to share the costs of hiring a consultant to assist in the preparation of a strategic plan or framework for the development of affordable housing in the City. Other partners in developing the affordable housing plan include Tarrant County, the Tarrant County Housing Finance Corporation, Housing Channel, Fort Worth Area Habitat for Humanity, Inc. and Tarrant County Samaritan Housing; WHEREAS, the Board of Directors of the Corporation (the "Board") and the City Council both adopted Resolutions supporting the Fort Worth Affordable Housing Strategic Plan (Resolution No. FWHFC-2018-07 and Resolution No. 5026-2018); WHEREAS, the affordable housing strategy, now known as the Fort Worth Housing Strategic Framework Plan (the "Strategic Framework Plan"), includes a special focus on the creation of Permanent Supportive Housing for chronically homeless individuals and families as a RESOLUTION NO. FWHFC-2022-09 Page 2 of 6 priority and identifies the Corporation and the City as funders and development partners for the creation of Permanent Supportive Housing units, and recommends guidelines for developers to qualify for City or Corporation fiends for Permanent Supportive Housing proj ects; WHEREAS, Permanent Supportive Housing ("PSH") involves long term rental assistance and case management for individuals and families who have been homeless for over a year and are disabled; WHEREAS, on October 22, 2019, the Corporation approved setting aside $5,000,000.00 for forgivable, no interest loans for the development of PSH projects that meet the following criteria; At least 20 PSH units per project No more than $25,000.00 of Corporation funds per PSH unit Foundations/grants to match Corporation funds dollar for dollar Forgivable, no interest loans evidenced by promissory notes and loan agreements, secured by mortgage liens 20-year Performance Period as PSH project Developers to furnish equity Project must be financially viable for entire 20-year Performance Period Project must meet acceptable underwriting criteria including project operations, sources and uses, ownership structure, and developer financial strength All loans subject to Board approval; WHEREAS, through various projects the FWHFC allocated $2,450,000.00 for PSH units, which will create 98 units throughout the City; WHEREAS, the Tarrant County Homeless Coalition notified the City and the Corporation that the largest need to address chronic homeless in the area was physical units, and the Corporation and the City pledged to fund the development of physical units in the City of Fort Worth; WHEREAS, the remaining $2,550,000.00 of FWHFC PSH set -aside fiends were combined with City funds in an aggregate amount of $17,769,277.00 to be awarded through a Notice of Funding Availability ("NOFA") for the creation of at least 165 PSH units; WHEREAS, the City issued the NOFA on March 8, 2022 and received six proposals, including the Journey Home Housing development proposed by the Presbyterian Night Shelter of Tarrant County ("PNS"); WHEREAS, a review panel consisting of three Neighborhood Services staff and one representative chosen by private foundations reviewed the proposals and recommended three projects for award; RESOLUTION NO. FWHFC-2022-09 Page 3 of 6 WHEREAS, it was determined that Journey Home Housing, which will provide 72 of PSH Units should be funded in part using FWHFC PSH set -aside funds; WHEREAS, the City has additionally allocated $4,928,000.00 in HOME-ARPA funds, $421,999.00 in American Rescue Plan Act, Subtitle M (State and Local Fiscal Recovery Funds) funds, and $1,262,801.00 of Directions Home capital funds to Journey Home Housing on June 14, 2022 (M&C 22-0456); and WHEREAS, the Board desires to approve a forgivable, no interest loan to Presbyterian Night Shelter of Tarrant County in the amount of $1,350,000.00, subject to availability of funds and the terms in Attachment I, to develop Journey Home Housing. NOW THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE FORT WORTH HOUSING FINANCE CORPORATION: 1. THAT the Board authorizes the execution and delivery of a loan agreement (the "PSH Loan Agreement") and related documents by and between the Corporation and Presbyterian Night Shelter of Tarrant County, which shall for all purposes of the resolution include an affiliate of Presbyterian Night Shelter of Tarrant County, for a forgivable loan in the amount of $1,350,000.00, subject to availability of funds (the "PSH Loan"), for the benefit of the Journey Home Housing development subject to the terms set out on Attachment I. 2. THAT Fernando Costa, General Manager of the Corporation, or Victor Turner, Assistant General Manager of the Corporation, or their duly appointed successors, are each authorized to execute and deliver the Loan Agreements for and on behalf of the Corporation along with any related documents or agreements necessary to implement the PSH Loan Agreement or the PSH Loan, and each is authorized to extend, modify and amend the Loan Agreement, the terms of the Loan or the terms of any related documents or agreements, provided any such extensions, modifications and amendments are within the scope of the project, and in conformance with the goals and purposes of the Corporation, as may be amended from time to time. 3. THAT this Resolution takes effect from the date of its adoption. AND IT IS SO RESOLVED. Adopted June 28, 2022 RESOLUTION NO. FWHFC-2022-09 Page 4 of 6 FORT WORTH HOUSING FINANCE CORPORATION j By. Carlos Flores President Attest: J4 � I &=20SLw Jannette S. Goodall Corporate Secretary RESOLUTION NO. FWHFC-2022-09 Page 5 of 6 ATTACHMENT I PSH Loan Terms Lender: Fort Worth Housing Finance Corporation Borrower: Presbyterian Night Shelter of Tarrant County or an affiliate Project: Journey Home Housing Location: 7550 Crowley Road Loan Amount: $1,350,000.00 Origination Fee: None Interest Rate: 0%; default interest rate 6% Amortization: Loan to be forgiven 20 years after the Project's conversion, provided Borrower has complied with all Loan terms Loan Term: Begins on date loan documents are executed and matures 20 years following conversion of the Project. Performance Project must remain permanent supportive housing for 20 years. Period: Begins upon conversion (on date project is leased up, 90% of units for 90 days or other similar measure approved by Lender) Lien Priority: Subordinate to any private permanent or construction financing necessary for development Payments: None as long as no default in Loan terms Loan Documents: Loan Agreement, Promissory Note, Deed of Trust, and Guaranty if applicable General Contractor: Acceptable to FWHFC Guarantees: Payment and completion guarantees in form and substance acceptable to FWHFC required from GC during construction period. If personal guarantees are required by FWHFC, must be acceptable to FWHFC in amount, duration, form, and substance Recourse: Non -recourse as to Borrower Grant Match: Grant funds must match FWHFC funds dollar for dollar RESOLUTION NO. FWHFC-2022-09 Page 6 of 6 Financing/Underwriting: Must establish that project will be financially viable for entire Performance Period. Will include evaluation of ownership structure, project operations, sources and uses of funds including cash flow analysis, developer/project owner's most recent financial statements, and if applicable, financial statements from team members and guarantors Other Conditions: Borrower to pay all costs of Loan closing Borrower to provide lender's title policy Development must receive/pass Environmental Review Acceptable environmental remediation, if required All financing acceptable to Lender Lien priority acceptable to Lender Approval of final construction plans for project Survey acceptable to Lender Appraisal acceptable to Lender P & P bond or LOC or satisfactory equivalent from General Contractor Receipt of all required governmental approvals Approval of current financial statements from Guarantor Approval of final project budget Borrower counsel opinion in form and content satisfactory to Lender Borrower to furnish acceptable equity Must comply with all loan requirements from senior and subordinate lenders Monitoring: Project to be monitored at least amlually Reports: Annual audit, copies of all reports to local, state or federal agencies, voucher providers. Any additional reports required by Lender Tenants: Tenants occupying the PSH units funded by Lender must be chronically homeless households referred through Tarrant County Continuum of Care Coordinated Entry. If there are no qualifying chronically homeless households, tenants occupying the PSH units funded by Lender must be disabled and literally homeless households referred through Tarrant County Continuum of Care Coordinated Entry.